NZ-EU farm trade talks remain mired

BRUSSELS - Top trade negotiators from New Zealand and the European Union remained at odds yesterday over how to cut farm tariffs which Brussels is under pressure to slash as part of a push to free up global commerce.

With an April 30 deadline for agreeing key areas of the World Trade Organisation's Doha round fast approaching, key trading countries are picking up the pace of bilateral meetings to explore ways of breaking the deadlock.

After meeting with Trade Minister Phil Goff, EU Trade Commissioner Peter Mandelson said New Zealand needed to take "a comprehensive look at the EU's agricultural offer and recognise its value for New Zealand's farm exporters".

Goff said the EU had made progress on cutting subsidies but its planned tariff cuts for farm imports provided little new market access for his country's exporters of cheese, butter and milk powder and made a small difference for beef.

"What appears on the surface to be quite a big cut in tariffs doesn't have the impact of making trade flow," he said.

"The tariff levels are so high that what has been offered has negligible effect in improving market access by our calculations."

He added that the talks would continue.

Big agricultural exporters such as Australia, Brazil and the United States, as well as New Zealand, want bigger import tariff cuts from the EU in agriculture. But Brussels is under pressure from EU countries such as France not to make more concessions.

Goff said New Zealand and the EU agreed on the need for progress in the two other key chapters of the WTO round - reducing barriers to trade in manufactured goods and services.

But in other areas of the farm talks, the two sides remain at loggerheads. The EU says New Zealand has to discipline what it calls trade-distorting practices of export co-operative Fonterra. But Goff insisted "nothing about Fonterra is trade-distorting".

And there were differences on the EU's demand that other countries should accept selected European food produce as geographically exclusive, such as feta cheese from Greece or prosciutto di Parma ham from Italy.

"We don't believe there can be a discussion at all of geographical indicators until there has clearly been wider progress in the area of agriculture," Goff said, adding his country's producers of cheddar cheese would lose if the name was restricted to cheese made in England.

The Doha round was launched in 2001 to help developing countries and boost the world economy but several deadlines have been missed, largely due to the wrangling over agriculture.

- REUTERS