Seed trade body non-political

Press, 20 November 1987, Page 15

Seed trade body non-political

International seed traders hope they will never have to make a stand on world trading policies. Delegates to the Federation Internationale du Commerce des Semences (F. 1.5. world congress in Christchurch this week were asked by the Minister of Overseas Trade and Marketing, Mr Moore, to ask their respective government ministers to push for reform to the world trading system. Mr Moore spoke out against subsidies and forms of protection, saying they distorted world trade, punished the efficient, and bruised and battered developing countries. Reform had to come and he hoped it would do so during the current round of GATT talks.

The president of F. 1.5., Mr Clifford Aiderton, said if the decline in world agriculture continued he could not see why members of the federation could not make some effort to stop it. Declines in agriculture would affect their own business. The F.I.S. was a nonpolitical organisation. “We don’t attack particular types of policies but we would certainly watch for any legislation brought in by governments which would reduce the viability of agriculture,” said Mr Aiderton.

He was interested in how the New Zealand Government was handling agriculture under its free

By

JOHN HARFORD

market, no subsidies approach.

' “I would like to ask the farming community if Mr Moore is right.” He agreed the federation might have to take action if agriculture continued to be run down but the time was “a point on the horizon and I’m not sure we will ever reach it.”

Any action would be limited to non-political pressure for reform on the government of all member countries at the same time.

“I hope we would never have to take those steps because we would only have to take them if agriculture was in a distressed state,” he said. While Mr Moore’s speech would be discussed by some delegates, Mr Aiderton did not see it as a major issue for the congress. Mr Moore said that research on protectionism had been done in the last two years by the Bureau of Agricultural Economics, the World Bank, and the E.E.C. The Bureau’s study had shown that 75 per cent of agricultural support went to the richest 25 per cent of farmers. Poor farmers missed out.

“Subsidising agriculture and protecting markets are just clumsy ways of exporting social and political problems. If governments can’t stand the poli-

cal pressure at home, they subsidise and protect and export their problems.

“This low level of political willpower is destroying the world economy,” he said. “There’s an obscene misallocation of resources in Japan, the European community, and the United States which is imposed as an everincreasing burden on taxpayers and consumers.” He said that 10 years ago farm support cost European Community taxpayers SUS 6.2 billion. This year the bill would reach $23 billion, not including support from national treasuries.

The United States spent $2.7 billion on its farmers in 1980 and was facing a bill of $3O billion this

year. “All this in the farmyards and backyards of those nations who lecture the world on free trade. It’s no wonder that developing countries have little faith in, and cast an increasingly sad and cynical eye at, the principles and institutions of free and fair trade."

Rich countries paid their farmers too much to produce too much. Surpluses were either given away as food aid, or dumped on third markets with the help of export subsidies. Both actions distorted world trade and welfare.

“In Tanzania 80 per cent of the population lives off the land but farmers receive only a quarter of the world price for maize. The Tanzanian treasury is no match for the subsidies from rich treasuries of the west.

“Who can blame politicians in developing countries from turning their backs on a political and economic system which is offered to them as a model when, just at that moment, when their faces are at the door, it is locked, leaving them with a vivid memory of our hypocrisy and the failings of our system,” said Mr Moore.

The recent fall in the sharemarket should be a warning that a replay in protection measures would mean a replay of the recession of the 19305.

“A replay of the depression of the 19305, which led to World War 11, will be ruinous for all.

“All nations and global organisations such as GATT, and even your own world seed trade organisation, share the responsibility of not repeating this mistake.

“But it is the major powers in the west and especially the United States which has the responsibility for they are the richer economies of the free market economies of the world. It is in their hands that the future of world trade lies at this delicately poised time in our history,” Mr Moore said.