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$45.1b US farm bill may tangle WTO talks: Analysts

REUTERS, Washington
US trade officials, already engaged in difficult negotiations for freer world farm trade, could face an even more onerous task due to a $45.1 billion farm bill ready to become US law, say farm trade analysts.
Passed by the House of Representatives last week and facing a Senate vote this week, the bill would increase US crop and dairy subsidies to farmers by 62 per cent. It would also require a country-of-origin label on meat, fruit, vegetables, fish and peanuts.
President George W. Bush has promised to enact the bill with its "generous and reliable" safety net for US farmers.
It is the "generous" part that runs the risk of complicating World Trade Organization trade talks, where
agriculture plays a central role.
"It will be harder to achieve significant trade liberalization in agriculture after this farm bill than with one that was more tradefriendly," said Daniel Sumner, an economics professor at the University of California-Davis and an Agriculture Department official a decade ago.
The trade negotiations, designed to conclude in 2005, aim for an international agreement to expand trade in farm goods by phasing down subsidies that distort farmers' planting decisions or unnaturally boost exports.
The talks would also discourage use of quotas, tariffs and other barriers to foreign grains, oilseeds and meats.
American diplomats, Sumner said, now will be thrown into Geneva negotiating sessions where "every-
one is yelling 'hypocrite'" at them.
Canadian Agriculture Minister Lyle Vanclief, speaking in Ottawa on Friday, may have provided a preview. Americans, he said, were "not walking the talk that they gave in Doha" (Qatar) last November, when the WTO trade round was launched.
As a world leader in agriculture, the United States has been the premiere advocate of the free market -- from cajoling Europeans into abandoning their beloved export subsidies, to persuading developing countries to lower import barriers and cut subsidies for their own farmers.
Along comes a new law dictating US farm policy for the next six years, one that EU agriculture commissioner Franz Fischler argues will shield American farmers from low prices, resulting in trade-distorting over-production.