After months of behind the scenes negotiating, the 147 members of the World Trade Organization unanimously agreed to approve a framework that has brought world trade talks back on track. And the United States and European Union promised to reduce their subsidy cap by 20% in the first year of agreement.
Other key agricultural agreements for the legally binding treaty designed to liberalize international trade includes a 5% cap on subsidies limiting production, eliminating export subsidies, eliminating export credits guarantees or insurance programs with repayment periods longer than 180 days, and regulating those with shorter terms.
The tentative agreement jumpstarts stalled talks from last fall when developing nations demanded richer nations end subsidy programs to level the playing field.
Sen. Tom Daschle, D-S.D. says the proposal marks a significant step backward for U.S. agricultural producers with the proposed 20% reduction in farm subsidies for corn, wheat, soybeans and other crops. "The proposed cuts seriously jeopardize the increased loan rates, the updated bases and yields and the counter-cyclical payments that I fought for as majority leader during the 2002 farm bill," he says.