May 8, 1986


GENEVA, MAY 6 (IFDA) -- The Asian countries blasted the United States Monday over its subsidised export policies on agricultural surpluses, particularly rice.

The Asian complaint came in the Preparatory Committee when it was considering issues in the area of trade in agriculture to be included in the negotiating agenda of a possible now round of Multilateral Trade Negotiations.

The Asian complaint, voiced by Thailand's Amb. Nissai Vejjajiva, was later made available to the press by the Thai delegation.

Vejjajiva said the present situation in agriculture clearly required urgent action, and agriculture was hence one of the most important topics for priority consideration in the new round.

The 1984 recommendations of the GATT Committee on Agriculture, which had been approved by the GATT Contracting Parties, should be the framework for further work aimed at improving GATT rules and disciplines on trade restricting and trade distorting measures, and to achieve genuine trade liberalisation and expanding trade opportunities for all CPS, big and small.

Massive export subsidies, variable levies, QRS and similar measures like voluntary export restraints, waivers, "grandfather legislation" (domestic protectionist laws predating GATT and thus saved from GATT articles), and sanitary and phytosanitary measures should all be addressed in the new round.

The principles of special and differential treatment for the third world should also be fully taken into account.

All GATT CPS, and particularly the major trading nations, the Asian spokesman said, must subscribe to and honour the standstill commitments, particularly in respect of subsidization policies and practices.

CPS should also avoid worsening the situation by engaging in export policies that adversely affected exports of third parties.

Vejjajiva put the Thai, and Asian concerns, over the U.S. food security act of 1985 in this context.

Asian's concerns in this matter, he said, was because the law allowed the U.S. Agriculture Department, through the use of loan rate mechanism, to significantly lower U.S. agricultural prices in world markets, including that of rice, a primary agricultural export of Thailand.

In addition to this, there was an array of export subsidies that would be made available to U.S. agricultural exporters which could contribute to further declines in world agricultural prices, thus worsening an already depressed world market for agricultural products, and especially that of rice.

Even the weekly U.S. announcements of world market price for rice had its psychological and actual effects "whose impact is to disrupt and harass rice exports of Thailand", Vejjajiva complained.

The farm act of the U.S. could lead to further distortions in world agriculture trade and would prejudice and jeopardise ongoing efforts in GATT to reduce distortions and allow free market forces to determine trade in agriculture, he warned.

The U.S. farm act was "a deliberate programme to subsidize agricultural products and exports", and thus violated article XVI of GATT, as well as the provisions of part IV of GATT relating to third world countries.

"Such actions also reduce our confidence in the GATT multilateral framework", the Thai delegate said.

Agricultural exports, and particularly rice exports, had their impact on Thailand's foreign exchange earnings and affected the livelihood of 35 million farmers.

Thailand hoped the U.S. would take into account Thai concerns, and would handle the powers under the farm act in a way which would seek "to minimize disruption in rice markets served by Thailand".