US farm bill prompts Caribbean rethink

by Dionne Jackson Miller

MONTEGO BAY: Caribbean countries feel betrayed by the latest US farm bill and will discuss a fitting response at the upcoming Caribbean Community (CARICOM) talks, say Jamaican officials.

The law, which US President George W. Bush signed on 13 May, expands subsidies to US farmers to $190 billion over the next decade. Free trade and fair trade advocates alike have criticized the legislation as distorting markets and damaging developing countries’ and agricultural exporters’ trade prospects.

Caribbean states feel especially betrayed because the US, other wealthy nations and the WTO have pressured the region’s tiny economies to lower tariff and non-tariff barriers to US and other imports. Cheap imported foodstuffs have flooded the markets of countries like Jamaica, nearly wiping out local farmers who are unable to compete with the low-cost, subsidized imports.

“We have to rethink our strategy, because we were going along a road which they called free trade,” says Jamaican Agriculture Minister Roger Clarke. “This is really flying in the face of whatever we’re talking about at the WTO, and it is going to be for us now to rethink. We have to find a way because it cannot go like this, our people are going to be totally wiped out.”

The US farm bill will be high on the agenda of the CARICOM agriculture ministers’ meeting in June, says Clarke.

Farmer Bob Miller urges the government to move quickly to ascertain whether the US has contravened global trade rules. “If it hasn’t, it means that the Jamaican farmers will have to be subsidized,” he says, adding that local consumer needs for low food prices will also have to be central to the government’s response.

“The way out of this is not to increase the price of local products, or put an extra tax on imported products. The Jamaican farmer will have to be subsidized. Find a way, the same way the US found a way,” says Miller.

He adds that the need for local subsidies is made more urgent because agriculture has serious implications for rural development and employment and the country’s social stability.

Jamaica’s policymakers are clearly worried about their options. With debt service payments consuming 60% of the national budget, they appear to have little room for manoeuvre.

“Already, we’re reeling under the effects of dumped cheap goods on us, and this puts us in a terrible position, because we’re not even in a position to subsidize,” says Clarke.

Of the $4.4 billion national budget for fiscal 2002-2003, some $22 million has been earmarked for agriculture. Budgets throughout the Caribbean could be further constrained by the high costs associated with challenging the US before the WTO, if advisors deem that a legally feasible route.

Sophia Murphy, director of trade programmes at the US-based Institute for Agriculture and Trade Policy, describes the farm bill as shocking but notes that the US long has spent massive amounts of money on farm subsidies.

“The farm bill is going to put the same programmes into different categories and it will continue to be large-level subsidies, but in the last five years, the US has been spending enormous amounts of money on agricultural subsidies anyway,” Murphy says. “They called it emergency payments and bailout payments, but what’s shocking this time around is that they’ve put it into the framework of the farm bill.”

However, she adds, the US move could have a positive effect by making clear that Washington has no intention of abandoning subsidies and thus reigniting global debate about support of agriculture, free trade and globalization.

It is increasingly likely the US bill will be challenged at the WTO, says Murphy. She acknowledges, however, that with international trade disputes tending to be protracted affairs, farmers from developing countries could suffer in the interim.

This is exactly why Jamaicans are calling for the government to move on this matter urgently.

Within the next 48 hours, Jamaica should complete its initial analysis of the US bill, while contacting its allies not just within CARICOM but also within the Commonwealth and other friendly groupings, says John Lamy, dean of the faculty of agriculture at the College of Agriculture, Science and Education.

“I was never, ever fooled by this idea of globalization, this whole global village and shilly-shally speech about free trade and open markets,” says Lamy. “The US wants to dominate trade, and they want it one way.”

“A lot of people have jumped on the global bandwagon, and they don’t realize that if we don’t find a way to make sure that our voices are heard and protect our people, we’ll just be sitting on the wall, 50,000 youths sitting on the wall, unemployed, and agriculture will be in the doldrums,” Lamy adds. “There’s no such thing as a level playing field when it comes to the US.” (IPS)                       

From TWE No. 280 (1-15 May 2002)