TWN Info Service
on WTO and Trade Issues (Apr10/04)
Geneva, 7 Apr (Kanaga Raja) -- The United States and Brazil on Tuesday appeared to have reached an agreement (with some details still to be finalised) in the long-running dispute over US subsidies on upland cotton, staving off the imposition by Brazil of more than $820 million in countermeasures against US goods and intellectual property rights.
The announced Brazilian trade sanctions were due to take effect from 7 April.
The announcement of
an accord with
The US and
Meanwhile, in some comments on 5 April (published in the Brazilian media), Brazil's Minister of External Relations, Celso Amorim, said that if negotiations up to 21 April are successful, resulting in concrete, credible and immediate steps, in the near horizon, the possibility of a broader understanding could be foreseen.
He further said that
any understanding that would be below the full implementation of the
determination of the WTO (on the
According to the Brazilian
Minister, this full implementation will involve complex actions both
by the executive and legislative powers of the
[A New York Times news
report of 6 April quoted the government of
Under the agreement
announced by Kirk and Vilsack, the
The US and Brazil further agreed to continue their engagement on these issues, with a view to agreeing on a process by June that will enable them to reach a mutually agreed solution to the longstanding dispute.
In two separate reports
on 31 August 2009 concerning arbitration proceedings in the US-Brazil
upland cotton dispute, the Arbitrator ruled that
In the first report,
the Arbitrator determined that the annual level of appropriate countermeasures
in relation to GSM-102 payments amounted to $147.4 million based on
Fiscal Year 2006 data. In its second report, the Arbitrator determined
that the annual level of countermeasures in relation to the
Shortly following the granting, on 19 November 2009, by the DSB of Brazil's request for authorization to retaliate against the US, Brazil informed the DSB that, on the basis of complete data related to fiscal year 2008 and calendar year 2008 obtained from the US and other sources indicated by the Arbitrator, the total amount of countermeasures authorized to Brazil would be $829.3 million.
On 8 March,
The list of goods - ranging from food products, fruit and nuts, wheat, cotton and household items to electric and electronic equipment and motor cars - corresponded to an amount of retaliation of $591 million.
The remaining annual
amount of retaliation to which
On 15 March, the Brazilian government launched a process of public consultations over a set of retaliatory measures in the area of intellectual property rights. The measures involved amongst others the suspension of patents, copyrights and royalty payments over a range of products.
According to a joint news release dated 6 April from the Office of the US Trade Representative and the US Department of Agriculture, on 1 April, Deputy US Trade Representative Miriam Sapiro and Undersecretary for Farm and Foreign Agricultural Services Jim Miller met with Ambassador Antonio Patriota, Secretary-General of Brazil's Ministry of External Relations to discuss the possible resolution of the dispute.
As a result of that
dialogue, the Brazilian government agreed not to impose any countermeasures
In exchange, said the
It added that under terms to be agreed by the US and Brazil in the Memorandum of Understanding, the fund would continue until passage of the next Farm Bill or a mutually agreed solution to the cotton dispute is reached, whichever is sooner.
According to the news
The news release further stated that the US also agreed to publish a proposed rule by 16 April 2010, to recognize the State of Santa Catarina as free of foot-and-mouth disease, rinderpest, classical swine fever, African swine fever, and swine vesicular disease, based on World Organization for Animal Health Guidelines, and to complete a risk evaluation that is currently underway and identify appropriate risk mitigation measures to determine whether fresh beef can be imported from Brazil while preventing the introduction of foot-and-mouth disease in the US.
of these initial steps, said the news release, the
"I am pleased
that our teams have been able to make substantial progress towards the
goal of a negotiated settlement which would avoid the imposition of
"As a result of
our discussions with
"I am so pleased
that we were able to agree on a path forward with
"I am also pleased
that our path forward respects our Farm Bill process and the role of
Congress in shaping our commodity programs. I look forward to working
with Congress and
According to US media reports, the agreement has been welcomed by US lawmakers.
In a statement issued on 6 April, US Senate Agriculture, Nutrition and Forestry Committee Chairman Blanche Lincoln and Ranking Member Saxby Chambliss said: "We believe it is appropriate on the part of both governments to take steps to avoid the imposition of retaliatory tariffs and other countermeasures."
"Failure to do so would make it far more difficult to reach a negotiated resolution in this long-running dispute. We are encouraged that both sides have agreed upon a framework for dialogue and a process to further discussion," they added.
"Ultimately, Congress and the Senate and House Agriculture Committees in particular are responsible for crafting changes to these programs and we look forward [to] working with Ambassador Kirk and Secretary Vilsack as both sides explore modifications for consideration during the 2012 farm bill process," they further said.
Trade observers in Geneva said that until details of the terms of the US-Brazil settlement in the dispute are agreed and notified, it would not be clear what effect this would have on the other cotton producers/exporters, like the "Cotton-4" in Africa (comprising Benin, Burkina Faso, Chad and Mali), and whether this would remove one of the hurdles in the agriculture talks in the WTO's Doha Round. +