Latinnews Daily - 28 August 2003
CENTRAL AMERICA: Region tackles agriculture under US-Cafta
The sensitive issue of agriculture is finally being broached by Central American negotiators in advance of the seventh round of the US-Central American Free Trade Agreement (US-Cafta) in Managua on 15 September. Regional negotiators will hand US counterpart Jason Hafemeister their proposal for a specific compensation package in view of the US refusal to eliminate agricultural subsidies.
The compensation package being discussed consists of a special agricultural safeguard (SAE) to stop subsidised US agricultural products from flooding the regional market. Under the SAE, Central American countries will apply tariffs and/or quotas equivalent to the subsidy applied by the US to distinct products. Mario Salaverría, president of the regional farmers' association, Fecagro, explained that he expected the US to look favourably on the proposal as it would not budge on its own subsidies.
Central American negotiators might have more trouble selling the proposal to domestic producers. Several agricultural organisations have expressed serious concern at the threat of US subsidised products, and want a failsafe protective mechanism. The greatest impact of the US farm bill has been on products that the US is protecting domestically and that are already competing in Central American markets, such as pork, maize, soya, peanuts, milk and dairy products. Most of the important Central American agricultural exports to the US, namely sugar, peanuts and dairy products are already subject to specific import quotas.
The compensation package being discussed consists of a special agricultural safeguard (SAE) to stop subsidised US agricultural products from flooding the regional market. Under the SAE, Central American countries will apply tariffs and/or quotas equivalent to the subsidy applied by the US to distinct products. Mario Salaverría, president of the regional farmers' association, Fecagro, explained that he expected the US to look favourably on the proposal as it would not budge on its own subsidies.
Central American negotiators might have more trouble selling the proposal to domestic producers. Several agricultural organisations have expressed serious concern at the threat of US subsidised products, and want a failsafe protective mechanism. The greatest impact of the US farm bill has been on products that the US is protecting domestically and that are already competing in Central American markets, such as pork, maize, soya, peanuts, milk and dairy products. Most of the important Central American agricultural exports to the US, namely sugar, peanuts and dairy products are already subject to specific import quotas.
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