U.S. Trade Representative Rob Portman made a stop in Burkina Faso in Africa two weeks ago on his way to Asia for meetings on trade policy reforms and the Doha Round negotiations. His purpose was to announce a $7 million West Africa Cotton Improvement Program aimed at cotton production and marketing in Benin, Burkina Faso, Chad, Mali and Senegal. The program is part of an ongoing effort begun two years ago after the Cancun, Mexico WTO Ministerial meeting stalled partly over West African nations’ concerns about subsidizes paid to cotton producers in developed countries.
The visit by President Bush later this week to China and speeches earlier this week by U.S. Trade Representative Rob Portman have increased attention on the role of China in the WTO trade policy negotiations. To date China has been mostly silent. They have too much to lose to sit on the sidelines.
With the ongoing struggles over agricultural trade issues, casual observers of the WTO negotiations could conclude that the talks are all about agriculture. In terms of the amount of trade, goods and services are much more important than agricultural trade, but agriculture gets most of the attention because of the politics. The recent agreement on zero tariffs for “multi-chip integrated circuits” has brought trade in manufactured goods and services to the center of the WTO negotiations.
In late October the EU offered a second comprehensive proposal for WTO trade policy reforms. The proposal and official EU statements give a clear picture of what is needed to work toward a WTO agreement on agricultural issues over the next twelve months. Compared to the results of the Uruguay round of negotiations that ended in 1994, there has been a sea change in the bargaining position of the EU.
While most of the trade policy activities are focused on the WTO negotiations, serious thinking is continuing on how to improve U.S. economic performance by enhancing trade relations in North America through upgrading the NAFTA relationship. Agricultural trade is an integral part of that thinking. The “Recommendations for North American Economic Integration” from a new book titled NAFTA Revisited: Achievements and Challenges by Gary Clyde Hufbauer and Jeffrey R. Schott of the Institute for International Economics provides solid direction for upgrading NAFTA.