Washington Insider -- Thursday

India and the WTO

Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.

Senate Agriculture Committee Likely to Turn Over Next Year

If Republicans gain the majority in the Senate following next week's elections, the Senate Agriculture Committee could be led by Sen. Pat Roberts, R-Kan., (if he wins reelection), replacing Sen. Debbie Stabenow, D-Mich., who likely would remain the committee's top Democrat. However, for Roberts to be handed the gavel, Sen. Thad Cochran, R-Miss., (who also is facing reelection) would need to step aside, choosing instead to chair the Appropriations Committee.

Senate Minority Leader Mitch McConnell, R-Ky., the third-ranking Republican member of Agriculture Committee, also is up for reelection, while fourth-ranking Sen. Saxby Chambliss, R-Ga., is retiring at the end of this session of Congress.

Lobbyists says that if Roberts is reelected and becomes committee chairman, then they expect him to focus on foods made with genetically engineered (GE) components as states across the country attempt to pass labeling laws. Roberts also may choose to take another run at reforming the Supplemental Nutrition Assistance Program (food stamps) and a proposed Environmental Protection Agency rule regarding its authority over U.S. streams and wetlands.

Republicans needs a net gain of six seats to win control of the Senate. Some political analysts expect that some Senate races are so close that it may be December or even January before the country knows whether Republicans have been successful in taking control of that chamber.

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House Majority Leader Wants Greater Transparency of EPA's Scientific Information

House Majority Leader Kevin McCarthy, R-Calif., says the House "soon" will consider legislation that would require the Environmental Protection Agency to base its regulatory actions and rulemakings on scientific information that is publicly available and replicable.

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House Republicans have claimed that EPA uses non-public science information as it develops its regulations. The bill, introduced by Rep. David Schweikert, R-Ariz., and 52 co-sponsors, would require EPA to identify all scientific information used in the development of regulations.

Earlier this year, EPA administrator Gina McCarthy (no relative) claimed that it was a "small, but vocal, group of critics" that insist on attacking scientific research and she questioned their motives for doing so. "My guess is that those critics that distrust the most trustworthy institutions — and vilify the work of reputable scientists and EPA — are not trying to provide scientific clarity," EPA's McCarthy said. "My guess is that they're looking to cloud the science with uncertainty — to keep EPA from doing the very job that Congress gave us to do."

The legislation, which does not place similar reporting requirements on any other agency of government, is unlikely to be considered during the few short days of the lame duck session in November and possibly December. It likely will be introduced again next year and could have a good chance of passage, at least in the House.

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Washington Insider: India and the WTO

There has been little good news from the stagnant World Trade Organization's Doha Round for a long time, so it has been easy to forget that all that work has resulted in agreement on a number of issues — even though it has fallen far short of the ambitious agreement trading partners had in mind at the beginning.

Now, however, India's insistence on new concessions on food stockpiling "would appear to represent serious erosion on domestic support commitments that have already been achieved during previous negotiating rounds," according to report earlier this month by the Congressional Research Service. The CRS described key aspects of the WTO's Bali Package that deal with agriculture, and it emphasized the ongoing impasse in negotiations over food stockholding programs in its report.

At the WTO's Ninth Ministerial Conference in Bali, Indonesia, just over a year ago, participating ministers adopted a series of decisions aimed at streamlining trade and providing developing countries more options for providing food security.

That package of agreements represented the first multilateral trade deal in nearly two decades, and included five agricultural issues: export subsidies and other policies known collectively as export competition; tariff rate quota administration focused on managing persistently under-filled quotas; a temporary peace clause for a developing country's above-market purchases of commodities for food-security stockholding programs; a proposed list of green-box-eligible general services of particular interest to developing countries; and cotton.

But the first major implementation step under the Bali Agreement included a July 31, 2014, deadline — a deadline that was missed after India proposed a delay until a permanent solution is reached. The key issue was food stockholding programs in which governments buy commodities from farmers at above-market prices to distribute to poor populations, and how these should be reported in terms of WTO subsidy limits.

This has put the rest of the Bali package in doubt, the CRS report says. The United States and other developed countries have taken the position that the Indian insistence on food stockpiling is a deal breaker that undercuts the continuation of the talks.

To the extent that the Bali Agreement represented the low-hanging fruit of the agricultural negotiations, the contentious, last-minute nature of the final result, coupled with the almost minimalist nature of the "concessions" has led many trade analysts to wonder if the ground-breaking Uruguay Round agreement of 1994 was a one-time event, the report observes. The Uruguay agreement achieved substantial concessions and commitments across all three pillars of agricultural negotiations: export competition, domestic support and market access.

Observers now are openly speculating that there is no longer the necessary will among trading partners to pursue even the much-reduced ambition of the Bali Agreement and point to tensions within the developing country members, especially concerning China but also Russia, Brazil and, most prominently India.

They also note the growing political suspicion of trade deals in the United States where passage of "fast track" authority for the president is uncertain and the unwillingness of negotiators to even consider significant concessions.

This is bad news for agriculture since it appears to signals the practical demise of the Doha Round. Even though trading partners are continuing to push hard for free trade deals in both the Atlantic and Pacific, such agreements tend to be far less ambitious than broader multilateral deals.

Thus, it now appears that, given the recent record of the Doha talks, the smaller regional and bilateral free trade agreement approach may be the best trade policy tool available and should be pursued as actively as possible, Washington Insider believes.


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(GH/CZ)

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