MercoPress. South Atlantic News Agency

FTAA talks: agriculture differences persist.

The “informal” talks held in Buenos Aires last week with the purpose of advancing negotiations for the creation of the Free Trade Association of the Americas, FTAA, block late this month in Mexico failed when no agreement was reached on farm export subsidies.

"We have not been able to reach a common draft (declaration) and this is why we have decided to suspend the meeting scheduled to be held in Puebla, Mexico April 21", informed Argentine International Trade Representative Martín Redrado speaking for Mercosur members, Brazil, Uruguay, Paraguay and Argentina.

Even when United States was willing to accept the elimination of farm export subsidies, Mercosur questioned a clause on which the US was adamantly insistent regarding the automatic resumption of the practice "if European Union highly subsidized exports begin having access to the area".

For Mercosur in that case sanctioning was enough with no need of resumption of export subsidies.

"We are determined to have an efficient and effective ban on imports of subsidized produce", said the US Trade Office representative Peter Allgeier who admitted that the US subsidizes dairy product exports to Mexico, approximately between 15 and 20 million US dollars annually.

Mr. Allgeier compared this figure with the "one to two billion US dollars in export subsidies annually disbursed by the European Union", accepting that the US actually invests 19 billion US dollars in domestic farm subsidies, plus subsidized interest rates for agriculture credits.

According to the original timetable FTAA should be operational by January 2005, but in spite of the reiterated differences, all participants still trust the deadline can be achieved.

"Even when it's hard to anticipate an agreement that contemplates zero tariffs and subsidies, we're still confident that the block will be in place by the scheduled date", said the Brazilian representative, Regis Arslanian who admitted he expected "more" from the US delegation given Brazil's written commitment, --in a letter recently sent by Foreign Affairs Secretary Celso Amorim to the White House--, to reach a compromise.

However another Brazilian delegate Adhemar Bahadian was more upbeat, "there's no crisis, we're working cautiously".

US, Canada, Mexico, Chile, Ecuador and the four members of Mercosur participated in the frustrated "informal" talks of Buenos Aires.