Global Policy Forum

by Larry Elliott

Clare Short, the international development secretary, will today attack the common agricultural policy (CAP) with a warning to the European Union that failure to cut huge farming subsidies will deepen poverty in developing countries by wrecking global trade talks. Her intervention is a clear sign of Britain's belief that last month's deal between Germany and France to ring-fence spending on the CAP for the next 10 years will harm poor countries. She will say that resistance to measures that would prevent over-production and the dumping of excess crops on world markets will "destroy" the chances of trade liberalisation talks succeeding.

She will urge today's meeting of the EU general affairs and external relations council in Brussels, which is finalising Europe's policy on trade and development, to join opposition to production subsidies that lead to goods being sold on world markets at prices lower than they cost to produce. The World Trade Organisation launched the current round of talks in Doha last November, but progress has so far been stymied by the failure of the West to make good promises on agricultural reform. Pressure from seven of the EU's 15 member states - France, Italy, Spain, Portugal, Greece, Austria and Ireland - has resulted in any mention of CAP reform being omitted from the draft to be discussed by ministers today.

Ms Short will tell the meeting that any money Europe spends on agriculture must be diverted into support for rural communities rather than be used to finance over-production. "We must be committed to reform of the CAP to deliver on the Doha measures. Failure to do so would cause fatal damage to the prospects of Doha succeeding", she said last night.

Developing countries had only signed up for a new round of talks in Doha a year ago because they had won assurances that the EU and the US would take steps to scale back subsidies for farmers. "Developing countries made it clear that there would be no trade round unless they made gains. That's why the promises were made. Now the European Union has to deliver."

Ms Short said that unless the EU agreed to "disconnect production from subsidies, it will be destroying Doha. We had an unprecedented consensus a year ago when the talks were launched... If the Doha round goes sour it will break that up, it will endanger the WTO and it will lead to the further marginalisation of poor countries."

Her intervention in the increasingly bitter row over the future of the CAP comes as the chancellor, Gordon Brown, plans to call on the West to support a new deal for Africa. He will spend the next few months seeking support among the G7 industrial nations for a four-part package, which would include better access to rich western markets and a doubling of aid to $100bn (£63bn) a year in return for economic stability and proposals by poor countries to root out corruption.

Britain was furious at last month's deal between France's Jacques Chirac and Germany's Gerhard Schrí¶der to maintain spending on the CAP, which costs Europe £25bn a year. Sources said that France's avowed concern about the plight of Africa and Spain's interest in Latin America were at odds with their point-blank refusal to discuss meaningful CAP reform.

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