Switzerland defends agriculture subsidies

Fruit is a main staple of farming in canton Valais Keystone

A bloc of countries, including Switzerland, has presented new demands to defend farming subsidies ahead of a World Trade Organization (WTO) meeting, called to cut import duties.

Trade ministers will gather in Geneva on Tuesday to try to overcome differences blocking a new global treaty.

The so-called “Group of Ten” nations, which heavily subsidise their farming sectors, are asking that non-commercial concerns be taken into account, such as consumer and environmental protection.

The countries also want to preserve high tariffs for what they consider “sensitive products”.

Speaking in Geneva on Friday, the chief Swiss negotiator, Luzius Wasescha, said for Switzerland these included dairy products, meat, fruit and vegetables – essentially everything produced by the country’s farmers.

Another member of the group, Japan, has put rice, sugar, grain, beef and pork on its list.

No cap

Switzerland and its allies want to prevent the final treaty from including a cap on tariffs.

Under discussion is a cap limiting tariffs to between 100 or 150 per cent of a product’s value.

“We would be satisfied if we are able to get rid of the cap,” Wasescha said in an interview with the German-language newspaper, “Tages-Anzeiger”.

He said he doubted, however, that Switzerland would be able to retain its protectionist policies.

“The United States would like to do away with tariffs altogether, and farmers want to keep them,” he added. “I think we have to find a compromise solution that satisfies both sides, and that’s what I’m trying to achieve.”

Big loss

Figures from the Federal Agriculture Office suggest that Swiss farmers could lose as much as SFr2.5 billion ($2 billion) in annual revenues.

At next week’s meeting, trade ministers will attempt to bridge differences that have persisted since the talks collapsed in the Mexican resort of Cancun last September.

Developing nations have demanded massive cuts in farm subsidies common among industrialised countries like Switzerland, arguing that they undercut poorer nations’ ability to compete in world markets.

Besides the clause on the cap, the complex draft of the treaty includes a text which would enable governments to make smaller cuts to subsidies on products they consider sensitive.

The WTO ruling council has set July 30 as the deadline for reaching agreement on a treaty.

If no deal is concluded, the negotiations will be paralysed for months because of the upcoming US presidential elections and the changeover of power at the European Commission.

swissinfo with agencies

In brief

The 147 members of the WTO will resume talks in Geneva on Tuesday on a treaty to cut import duties.

Swiss farmers stand to lose up to SFr2.5 billion in revenue if agricultural subsidies are cut.

Switzerland is the world’s 11th largest importer of agricultural products.

Key facts

The Group of Ten:
Switzerland
Japan
Bulgaria
Taiwan
Iceland
Norway
South Korea
Israel
Liechtenstein
Mauritius