U.S. farm lobbies call for action over India, China subsidies

GENEVA (Reuters) - Big developing countries such as China and India are routinely breaking international trade rules on agriculture and the U.S. government should take action to stop them, representatives of U.S. corn and rice growers said on Thursday.

“It’s time for action,” Robert Cummings, chief operating officer of USA Rice Federation, told Reuters in Geneva, home of the World Trade Organization.

“We’ve had enough years of non-compliance and it’s time for that non-compliance to be made known here and also made known to the U.S. government, and that a response be forthcoming, if the WTO is going to remain viable.”

Shannon Schlecht, vice president of policy at U.S. Wheat Associates Inc, said a reality check was needed as the WTO enters the next stage of global trade talks, when some trade diplomats expect the United States to be under pressure to make concessions on agriculture.

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“We want to see compliance and there are some ways to get that,” he said.

Cummings and Schlecht were speaking at the offices of King & Spalding in Geneva, a law firm specialising in international trade law and disputes at the World Trade Organization, a day after addressing around 40 trade diplomats at the WTO.

Their assertions were based on a study of five leading developing nations, China, India, Brazil, Turkey and Thailand, by agricultural trade lobbying firm DTB Associates, LLP.

DTB’s founder Craig Thorn, a former U.S. agricultural trade negotiator, said the five countries had rapidly increased their minimum support prices for crops and breached the maximum “aggregate measure of support” that they are allowed to provide.

“To the extent that these countries have notified their policies, they have in our opinion in every case cheated on their notifications,” Thorn said.

Recent WTO negotiations have been dominated by India’s demand for developing countries to be allowed to stockpile subsidised crops, an amendment that allows them to break the normal WTO rules, provided they meet certain conditions.

But no country was likely to invoke that exemption unless there’s some danger of them being sued, Thorn said, and even then they would find it difficult to show the subsidies did not distort trade, as was required.

“We’re pretty confident that the trade price effects of these policies are huge and measurable,” he said.

Earlier on Thursday, Thailand filed charges against its former prime minister for her role in a rice subsidy scheme that has cost the state billions of dollars.

Cummings said that if any of Thailand’s stockpiled rice made it into the export market at a price less than acquisition, Thailand would be automatically in violation of the WTO rules.

“We’re putting the facts on the table here, and we’re also putting the facts on the table for our government back home,” he said. “It’s probably fair to say that we’re getting a more favourable reaction as time goes on and as we’re bringing more facts to the U.S. government.”

(Reporting by Tom Miles. Editing by Jane Merriman)

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