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This will be registered as one of the biggest mysteries in the history of trade diplomacy On Aug 13 2003--a month before the WTO Ministerial Conference meeting in Cancn Mexico--American trade negotiators suddenly decided the US should join the EUs exclusive club of rich countries for perpetual agricultural protectionism On that date a joint US-EU proposal on agriculture offered as a means of breaking the deadlock of the WTO Doha Round was announced with great fanfare In a nutshell the Americans and Europeans were very imprecise in defining their commitment to lowering import barriers and were overly precise in shielding massive subsidies to their own farmers from meaningful reform Their proposal not only failed to commit to the total elimination of export subsidies as it should have done given that these subsidies constitute outright dumping but it also aimed to introduce provisions allowing them to legally perpetuate a significant part of their worst protectionist practices It also lacked a pledge to reduce over time--or to even cap--the amount of aggregate subsidies trade-distorting and non-trade-distorting to farmers And while being vague about how tariff and nontariff barriers to agricultural trade would be lowered the proposal was clearly skewed toward the EUs too-gradual and discretionary approach Why American trade negotiators coupled with the Europeans on the eve of the Cancn meeting is a mystery on several counts Until then the US had stood by its 2002 proposal calling for a rapid dismantling of both agricultural trade barriers and trade-distorting subsidies to farmers Global agricultural trade liberalization on balance would be very good for the US considering the significant benefits that would accrue to its consumers and its exporting farmers It is not in the US best geopolitical interests to unnecessarily share in the EUs dubious honor of being the biggest spoiler of the Doha Round as has now happened The Real Reason for Failure at Cancn The
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