EU Ministers Agonise over Fishing Quotas and Discuss AG Proposal

20 December 2002

EU MINISTERS AGONISE OVER FISHING QUOTAS AND DISCUSS AG PROPOSAL

EU Ministers, meeting for the Agriculture and Fisheries Council on 16-19 December, faced the toughest negotiations for years on a compromise deal on 2003 fishing quotas. They furthermore discussed the European Commission's new proposal outlining the EU's negotiating stance in the current agriculture talks at the WTO, and reached political agreement on the Commission's proposal related to the ban of hormones as growth promoters.

Marathon negotiations on fishing quotas

EU Ministers -- scheduled to complete talks on fishing quotas on Thursday, 19 December -- struggled in drawn-out meetings to find a compromise deal. While scientists warn that cod and other key species are on the verge of becoming extinct and should be protected, fishermen and nations with significant fishing fleets are fighting to save jobs and safeguard coastal economies and communities. The talks, which address both reform of the EU Common Fisheries Policy (CPF) and 2003 fishing quotas, have been described as deadlocked. If the 15 EU Ministers do not reach agreement on Friday, 20 December, the European Commission may impose emergency regulations for several months until the issue would be taken up at the EU Council of Ministers meeting in March. Ministers have also tentatively scheduled discussions for 8 February 2002.

The European Commission proposal under discussion does not involve the closure of North Sea fisheries, but rather 80 percent cuts in quotas for cod, haddock and whiting, and 40 percent cuts for plaice and sole. The proposal would also involve taking more than 8,000 trawlers out of operation with EU aid while the number of days at sea would be limited for other vessels. In cases such as cod, this could mean just seven days of permitted fishing every month. An estimated 28,000 jobs would be lost under the plan. The Commission proposal also focuses on tightened controls to tackle problems such as falsified reporting and operation in prohibited areas. Spain, France and other countries with large fleets are strongly opposed to the planned cutbacks.

The European Commission proposal is based on advice from the International Council for the Exploration of the Sea, that recommended a full fishing ban in order to preserve fish stocks for the future. Cods are now at their lowest ever levels due to years of over-fishing in the European fishing grounds. The collapse of the Canadian cod fishery outside Newfoundland provides a warning of what may happen if drastic action is not taken. Ten years ago, cod reached commercial extinction, and despite a ten-year moratorium on fishing, the cod has not returned. The fishing communities in the area have been devastated.

Ag proposal tabled

After longstanding internal difficulties to agree upon a common position on EU agricultural trade reform, the European Commission, on 16 December, presented to the EU Membership its proposal on the European trade bloc's new negotiating stance in the current agriculture talks at the WTO. Put under noticeable pressure by WTO trading partners to finally come up with a revised and more detailed negotiation offer, the Commission's move came just two days ahead of WTO Committee on Agriculture (CoA) Chair Stuart Harbinson circulating an "overview paper" on the current status of the agriculture negotiations on 18 December. Nevertheless, the new Commission proposal came too late both to be adopted by EU member states at the Council meeting as well as to be included in Harbinson's 18 December overview paper.

The key elements in the Commission paper are proposals to slash WTO Members' import tariffs by 36 percent, cut export subsidies by 45 percent and to reduce Amber Box subsidies [i.e. trade distorting support] by 55 percent. Furthermore, the proposal contains certain measures to be implemented for the benefit of developing country Members such as: giving full market access to imports from least-developing countries (LDCs); richer countries to give zero-duty market access for at least 50 percent of their imports from developing countries; and a "food security box" including a special agricultural safeguard as well as additional flexibilities granted to developing countries to pursue food security and rural development objectives.

According the observers in Brussels, the Commission's proposal has generally been received positively by EU member states. Noting that certain minor amendments in the various individual proposals could be expected, the Commission's position is expected to be adopted by EU member states in all of its substantive elements prior to the forthcoming end-January negotiating session of the WTO CoA.

In their preliminary comments, the 17-member Cairns Group of agriculture exporting nations, including Brazil, Australia, Canada, South Africa and Thailand, criticised the European proposal for contravening the Doha mandate to reduce, "with a view to phasing out, all forms of export subsidies", as well as for failing to make a suggestion on how to eliminate the so-called Blue Box covering partly decoupled government payments under production-limiting programmes. Additionally, the Group has been expressing its deep concern that the EU intends to address issues related to extending the additional protection for geographical indication (GIs) to products other than wines and spirits, precaution, labelling and animal welfare under the agriculture negotiating framework.Hormone ban approved

The Council reached political agreement on a Commission proposal to ban the use of growth-promoting hormones for farm animals. The proposal aims to amend Directive 96/22/EC, thereby making the current temporary legislative ban permanent. The European Parliament, which will vote on the proposal by mid-2003, is expected to back the ban. The US National Cattlemen's Beef Association strongly criticised the Council's decision, accusing the EU of flaunting WTO rules. In 1998, the WTO had ruled in favour of the US and Canada that the first Commission ban, instituted in 1989, was not justified on scientific grounds and had allowed the US to impose sanctions worth USD 116.8 on EU exports. The Commission is hoping that the scientific advice on health risks of hormone-treated beef underlying the adopted proposal would convince the WTO that the EU ban was scientifically justified rather than constituting a trade barrier.

ICTSD reporting; "EU agonises on fish quotas to save cod and jobs," REUTERS, 19 December 2002; "Extra day to rescue EU cod talks," BBC ONLINE, 20 December 2002; "EU ministers embark on all-night fish quota debate," REUTERS, 20 December 2002; "US impatient with EU ban on GMOs, beef hormones," REUTERS, 18 December 2002; "Ministers' no to hormones," BLOOMBERG, 18 December 2002.

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