Kieran Phelan (Fianna Fail)

I, too, welcome the Minister to the House to speak on the important subject of the WTO negotiations but specifically in regard to Ireland. I listened carefully to the Minister's contribution and I know the Irish corner will be well defended by the Minister at the WTO talks. It is important that Members of the Seanad get an opportunity to make contributions before the Minister leaves to attend the negotiations.

The ministerial conference is not the end point of the current round of the WTO negotiations and it was never intended as such. These negotiations are an important step on the way to the final stages in 2006-07. As I understand it, the negotiations were relaunched in 2004 when the WTO members agreed the core areas for negotiation. The EU's acceptance of the abolition of the agriculture export subsidies on the basis of parallel reform by other WTO members' competing subsidies, coupled with the continued reform of CAP, was the major reason for reaching the July agreement. In regard to those areas of agriculture, that will be the main topic of discussion at the conference.

The negotiations on the next WTO agreement are well under way in the run-up to the ministerial conference. There will probably be a need to hold a further conference in 2006 to finalise the details of the new agreement. Obviously, the Minister, who will attend the negotiations, will pursue the most beneficial outcome for the Irish agriculture sector. From our point of view, given the economic and social importance of our agriculture and food sector, this is a vitally important aspect of the negotiations. The outcome of the WTO agreement will determine the levels of future protection and support for agriculture and therefore the new round could have serious implications for the CAP.

There are three main areas on how the WTO talks will affect Irish agriculture. The three main areas of concern are domestic supports, the export subsidies and market access. It is important that the CAP and the single payment under the decoupling system are safeguarded under the green box because direct payments make a major contribution to farm incomes.

The Doha mandate provided for reductions and the eventual phasing out of export subsidies. It is important that the phasing out is carried out over the longest period possible so as to cause the least damage to Irish agriculture. We must retain the maximum possible level of protection for market access through a combination of tariff cuts and other mechanisms, including designating certain products as sensitive and implementing a special safeguard clause to protect our EU markets from increased competition from imports from some third countries.

Irish farmers are subject to full traceability of our beef, lamb and milk, while beef imports from Brazil and other countries outside the European Union are not subject to the same costly restrictions. Reducing tariffs substantially would prevent Ireland producing beef and milk at a profitable level. The only countries that would benefit are Brazil, New Zealand and Australia, which have large farms and huge heads of cattle and can produce beef at a low cost. Tariff reduction will not help poorer countries.

Some of the proposals being considered by the WTO in the lead-up to the Hong Kong meeting in December, including those of the EU, would devastate Irish farmers' incomes. Furthermore, they would result in farm enterprises, excluding decoupled payments, operating at a loss. The result would be an unprecedented fall in output which in turn would impact severely on rural areas and the national economy. Once agreed, these proposals will be irreversible and will lead to an acceleration in rural decay through the decline of the population and infrastructure.

I was happy to hear the Minister say in the Dáil during the week that the Government's priority was to ensure that the process of trade liberalisation continues in a fair and balanced manner and that the WTO continues to provide a stable and constant framework for the regulation of world trade. As a small, open economy Ireland has much to gain from a successful outcome to this round of multilateral negotiations.

The Minister has outlined the position on agriculture. The offer from the EU is as far as we can go, with which I agree as we have reformed domestic supports committed to the elimination of export subsidies and proposed substantial reductions in import tariffs. We have no more room for manoeuvre. It is unacceptable that the CAP would require further reform.

I wish the Minister and Minister of State at the Department of Enterprise, Trade and Employment, Deputy Michael Ahern, well and the best of luck in negotiations. Knowing them both, they will not be found wanting in defending Irish interests.