Mandelson denies he is 'selling out' beef industry

NEGOTIATIONS: EU TRADE Commissioner Peter Mandelson has strongly rejected claims that he is "selling out" the beef industry by supporting a new compromise proposal for a global trade deal. He has also said the vast majority of EU states are backing the controversial package, which could unlock seven years of deadlock in World Trade Organisation (WTO) talks.

"There is nothing that we are negotiating in this deal that would undermine any part of European agriculture. The beef industry, like others in European farming, have a strong future," said Mr Mandelson, who has been criticised by the Irish Farmers' Association (IFA) for supporting tariff cuts on beef imports, which they claim will destroy the sector.

But Mr Mandelson, who is the EU's chief negotiator in the marathon WTO talks taking place in Geneva, said Irish farmers were exaggerating the impact of the draft tariff cuts. "I believe that as a result of this round they will be equipped and strong to compete effectively in our European market, and I believe they can look forward to that strong future and the fears that have arisen are misplaced," Mr Mandelson told The Irish Times .

Under the compromise proposal presented to WTO negotiators by WTO chief Pascal Lamy on Friday afternoon, tariffs on beef imports into the EU would have to fall by 23 per cent over five years. The EU will also sign up to agree to accept a quota of 290,000 tonnes of beef at very low tariff rates in return for labelling beef as a sensitive product.

This designation means that the standard 70 per cent tariff cut proposed for agricultural imports into the EU will not take effect under a new WTO deal.

EU negotiators have also managed to ensure that 45 per cent of the 290,000 tonnes low tariff quota will be lower grade meat that will not compete with Irish high quality beef exports to other EU states.

EU agriculture commissioner Mariann Fischer Boel rejected the IFA's warnings of disaster for the beef sector, saying the industry had a good future and could even search out new markets in developing states in the event of a deal.

She also promised to use a proposed EU reform of the common agricultural policy (CAP), known as the health check, to try to find new ways to support beef and dairy farmers, for example by setting up new funding programmes for suckler cows.

Mr Lamy's compromise package was accepted as the basis for further talks by the world's seven biggest trade blocs - India, China, Japan, Australia, Brazil, the US and the EU - in a significant breakthrough in the week-long talks last Friday. The package is a delicate compromise that proposes cuts in agricultural tariffs and subsidies in developed states, such as the US and EU, for tariff cuts in industrial sectors in developing states.

Mr Mandelson said EU states had provided broad support for the package as the basis for further talks. But several states such as France and Ireland continued to express concerns about the proposed cuts in agricultural tariffs, while states also want to see more willingness from developing economies to open their domestic markets to services and goods exports.

Minister for Agriculture Brendan Smith said he could not accept the analysis of Ms Boel that the Irish beef sector would not be seriously affected by the proposed tariff cuts. He said the Government had raised its concerns at every meeting with the EU negotiators in Geneva and would continue to do so. But he said there was no question of vetoing the current talks at this stage.

A vote would only take place at the last stage of a WTO agreement when EU states would have to decide on a "final undertaking" - the name given to the package of measures contained in any final WTO agreement.

© 2008 The Irish Times

This article appears in the print edition of the Irish Times