NZ farmers gain from Smith's win

By Vernon Small

Apec trade ministers have agreed to press for an end to farm export subsidies, a move that would improve New Zealand farmers' competitiveness.

International Trade Minister Lockwood Smith and ministers from other agricultural exporting nations welcomed the agreement as a strong expression of the Asia- Pacific region's united front before the next World Trade Organisation negotiating round, due to start in Seattle in November.

Dr Smith said ending subsidies would help exporters, who often faced competition from goods subsidised up to their full value.

Ministers also managed to agree on a formula for negotiating tariff cuts.

The agreement is a significant victory for Dr Smith, who acted as go-between during seven hours of talks in two informal trade ministers' retreats away from officials.

The officials were seen by some as a brake on ministers' willingness to accept further quick trade liberalisation.

Japan had wanted Apec to recommend an approach that would have brought progress only on a single, wide-ranging deal once tariff cuts in all sectors were in the mix.

The US favoured allowing early agreements on a sector-by-sector basis before a wider deal.

The words accepted by ministers yesterday will now go to leaders for approval at their meeting tomorrow and Monday.

They would allow early sector agreements which could be reversed if no broad-ranging deal was reached.

The ministers want a new trade round to be completed in three years.

United States Trade Representative Charlene Barshefsky said the final wording of the communique did not mean the US had abandoned its "early harvest" approach to tariff cuts.

It would not agree to a single package until it knew which sectors were included, and believed only those "ripe" enough to be settled within three years should be included.

Dr Smith said it was too early to say which sectors these would be.

"If you load the agenda with Uncle Tom Cobleigh and all, you cannot possibly have a single undertaking completed in three years," he said.

He said issues put on the agenda for negotiation at the WTO would be treated as a single package and there would be an agenda for tariff cuts in areas beyond those.

Anti-free trade activist Jane Kersey said the statement would not find favour among farmers, who were increasingly questioning the benefits of reduced tariffs and looking for protection.

Ministers and officials have also struggled to agree over bids by Taiwan and China to join the WTO.

An early draft was changed and the names of the two countries dropped after objections to when Taiwan would join the 134-member grouping threatened a diplomatic split.

The feuding spilled over at the final press conference of trade and foreign affairs representatives, with Foreign Affairs Minister Don McKinnon repeatedly closing down questions from Taiwan's journalists trying to highlight Taiwan's case.

Taiwan attends the Apec meeting only as an economy, and not as a sovereign state.

United States tariffs on lamb exports, which have raised the ire of farmers, were never on the agenda, either at the meeting or at one-on-one talks.

New Zealand's position is that the US tariffs on our lamb exports are now an issue for the WTO disputes procedure and the matter was not raised with US representatives.