The Cairns Group 20th anniversary meeting has world trade leaders gathering in Australia. This week U.S. Trade Representative Susan Schwab and Secretary of Agriculture Mike Johanns are at the meeting, and trade is a top agenda item. During a news conference yesterday, Schwab and Johanns talked about the need for developed and developing countries to open their markets.
The stalled World Trade Organization talks are a hot topic for negotiators. Many are looking at ways to get the ball rolling again, but Schwab and Johanns told reporters that there has to be substance to any deal that comes out. "It's not some specific date that is a magic date, it is not an exercise in rock, paper, scissors," she notes. "The U.S. went first last October. We went first with a very big, very bold, very ambitious offer with the understanding and the expectation that other countries would match that proposal. Guess what? Didn't happen."
Schwab notes the go-first approach got no results. "It is, rather the quiet conversations, the exploring what-ifs, exploring red lines, sharing ambitions, going beyond where we think we were going to end up," she says.
Next week Peter Mandelson, European Union trade representative, will be traveling to the United States to talk about trade. Schwab and Johanns told reporters they would talk about moving forward with the U.S. Johanns notes that even under the ambitious proposal the U.S. and EU tabled earlier this year, the EU would "still be subsidizing at a rate of two to one versus the United States," Johanns says.
Johanns told reporters that between subsidies and tariffs the EU has a ways to move. The tariffs have to come down. "They have a very, very protective agricultural system with very high tariffs," he notes.
Australia has made a proposal to get the talks restarted, that calls for greater cuts by the U.S. Johanns notes that this week's event is not a negotiation. "We didn't come here to endorse the proposal; we're not endorsing that proposal. What we are endorsing is this whole idea of, let's get some discussion going, let's get some ideas out there," he says.