MercoPress. South Atlantic News Agency

New US farm policy punishes Latinamerica

The effects of the new United States 2002 farm policy will have a negative impact for Latinamerican exports, according to a report from the United Nations Economic Committer for Latinamerica and the Caribbean, Cepal with main offices in Santiago.

However the report indicates that the consequences for Latinamerican exporters and farmers will vary according to the countries.

Sugar, citrus, orange juice, grapefruit, lemons, apples, vegetables, cotton and tobacco "now have less chances of a greater access to the US market", underlines the report, adding that the spirit and letter of the bill is definitively protectionist, very distant from official international US policy on trade liberalization.

The bill was drafted to "strengthen the productive capacity of American agriculture and respond to pressures from traditional farmers' caucuses and on the other hand to change the rules of the game that preside over multilateral agriculture".

Cepal experts insist the bill increases protection mechanisms and farm aid with annual subsidies expanding between 15 and 20 billion US dollars, "which undoubtedly will have a negative impact on commodities international prices".

In the particular case of wheat, the new bill strengthens US competitive capacity in the region vis-à-vis traditional and efficient producers such as Argentina and Canada.

Another sector that will be severely punished is dairy production, specially in the Southern Cone.

Keeping and expanding domestic production subsidies and incentives to sell dairy production overseas will depress even further international prices", warns the document.