8 February 2005

Sutton Welcomes Bush's Cuts to Farm Subsidies

The Bush administration was serious in its commitment to a successful completion of the Doha Round, Trade Negotiations Minister Jim Sutton said today.

Mr Sutton welcomed news that United States president George W Bush had put forward a Budget that reportedly cuts farm subsidy spending by $US587 million and caps at $US250,000 the maximum payment per farmer. The new Budget also imposes a 5 percent reduction in crop and dairy payments.

"Domestic support levels are one of three key areas for agriculture negotiations at the World Trade Organisation, and many countries in the WTO have been waiting to see if the United States was prepared to move in this area."

Mr Sutton said there were several rich countries which had significant domestic support programmes. These programmes did distort international markets in agriculture.

"The most trade-distorting measures are export subsidies, but it has already been agreed that these will be eliminated as part of the Doha Round negotiations."

Mr Sutton said he was impressed with President Bush's commitment to limit domestic support programmes in the United States. The move was brave and would be recognised as part of the United States' efforts to ensure the Doha Round was successfully completed.

"The Bush administration is walking the walk."

ENDS

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