Brendan Smith (Cavan-Monaghan, Fianna Fail)

A Leas-Chathaoirligh, I thank you and your colleagues in this House for your good wishes on my appointment as Minister for Agriculture, Fisheries and Food.

I welcome this opportunity to address the House on the ongoing WTO negotiations. The current round of negotiations, known as the Doha development round, has been underway since 2001. Since then, many deadlines have been set for its conclusion and many intensive negotiating phases undertaken with a view to reaching a final agreement. However, due to the wide range of sectors covered by these negotiations and the complex nature of the negotiations in each of these sectors, it has proved to be an extremely difficult task to reach a comprehensive and complete agreement.

The WTO rule-based multilateral trading environment provides very significant benefits to Ireland. As a small open economy, we are very dependent on the ability to trade our goods and services across the world. This is why an ambitious and balanced WTO agreement will present significant opportunities for the Irish economy. However, these opportunities will only be realised if the final agreement is balanced, providing real liberalisation across all elements of the negotiations.

It is in this context that the Government and I have serious concerns about the current direction of the negotiations. There is a clear over-emphasis on the agriculture negotiations. The other major negotiating areas, such as market access for industrial goods, trade in services, trade rules and trade facilitation, have not progressed or do not currently present the same level of ambition as that being pursued in the agriculture negotiations.

I am acutely aware of the importance of the outcome of these negotiations for Ireland and I recognise the challenges which an agreement will present for Irish and EU agriculture. The current position in the negotiations is all the more disappointing, given that the EU has prepared in a constructive and responsible manner for these negotiations and has made significant contributions aimed at progressing the negotiations to a successful conclusion. The reforms of the Common Agricultural Policy, agreed in 2003 as part of the mid-term review of the Agenda 2000 package, were undertaken with the next WTO agreement clearly in mind. As part of the 2003 reforms, the EU made a deliberate decision to prepare in a forward looking and positive manner for the challenges which Doha set for agriculture. The EU move to decoupled payments was carried out with a view to fulfilling the Doha target of substantially reducing trade distorting domestic supports.

Decoupled payments, which by their nature are not linked to production, are considered non-trade distorting by the WTO. This EU move away from coupled and market support type payments has reduced very substantially our levels of trade-distorting supports, therefore fulfilling one of the key objectives of the Doha declaration. In addition, the reforms have also made European agriculture more competitive, better prepared for globalisation, more compliant with food safety requirements, more environmentally sustainable and more conscious of animal welfare requirements. All of these outcomes show the multi-faceted nature of the CAP and highlight that European agriculture policy is designed to deliver much more than economic benefits to society. The EU made another significant contribution at the Hong Kong ministerial conference, with the commitment to the full elimination of export refunds by 2013, on condition that all other forms of export subsidy are eliminated.

I am disappointed to point out that these contributions made by the EU have not been matched to date in the negotiations by the other major WTO negotiating partners. I am fully convinced that if we are to reach an acceptable conclusion to these negotiations it is now time for the other major negotiating partners, both developed countries and those emerging economy developing countries in a position to do so, to step up and make equivalent contributions which will result in a balanced and ambitious outcome.

There is no doubt that we are currently in the middle of another intensive negotiating phase, with the director general of WTO pushing extremely hard to reach an agreement by the end of 2008. Only this week the chairmen of the agriculture and market access for industrial goods negotiating committees issued new papers which will be used to move forward the negotiations with a view to reaching agreement in these areas at a ministerial meeting before the end of June. These papers are currently being examined by my Department and the intention is to call a meeting of the WTO consultative committee in the next week or so to share our assessment with that of the industry. While full details of these papers are still under consideration, our preliminary view is that they do not address all of the concerns which Ireland has identified in the negotiations. The papers only became available on Monday night.

The latest agriculture paper is along the same lines as that issued last February, but it includes more precise language or numbers on some of the main issues. For example, the level of tariff cuts proposed for the lower tariff bands is specified, whereas a range of possible cuts was included in the previous paper. The chairman makes clear in his cover note that where he has done this, it does not imply that negotiations are concluded on these points. These are his proposals and they are not conclusions. For the crucial highest band, the potential range of reduction proposed remains 66% to 73%.

The prospect of reducing the tariff cut for sensitive products by two-thirds remains in the text. This means that a number of tariffs, which would otherwise have to be cut by up to70%, would instead be cut by 23%. An increased tariff rate quota, or TRQ, would have to be conceded in return. How useful this is depends on the detailed provisions. The chairman again proposed in the new paper that the TRQ be based on consumption. The partial designation methodology is included, as advocated by the Commission, but only as one of two options. In our contacts with the Commission and with other member states, we have stressed the importance of achieving meaningful protection for sensitive products. I remain very concerned about this point and will be pressing the commission further on it on the basis of the new text.

The latest text also contains disturbing new language on the definition of the green box, where the concept of ceilings appear to be mooted. This is of major concern and I will be insisting that the assurances given on this matter as recently as last Monday by Commissioner Fisher Boel are fully honoured. The paper does not alter earlier proposals on export competition and I continue to have concerns about the lack of parallelism in this area. My view is that EU commitments to dismantle its export refund system must be matched with equivalent commitments by our trading partners.

I also have some concerns that new market realities and emerging food security issues are being ignored in the rush towards an agreement. The world has changed substantially since the Doha round began in 2001 and we need to take these changes into account in concluding the round. We must safeguard our agricultural production base in the EU so that we can meet the future demand of our population for food, feed and bio-energy, while at the same time remaining in a position to assist least developed countries to meet their growing food needs.

I have doubts about the wisdom of pressing for conclusion of the negotiations at a time when the United States is in the throes of its presidential election campaign. The recent progress of the farm Bill in Washington does not suggest that there is any appetite in Washington for a deal at this stage, yet we are closer to the point where it is expected that the WTO director general will call a ministerial conference to attempt a partial conclusion of the round. I have to question this approach.

There remains a clear imbalance in these negotiations between the level of ambition in the agriculture pillar and that of the other negotiating sectors. Equally, there is an imbalance within the agriculture negotiations across the different negotiating pillars and in respect of what the EU is being asked to concede and what it is receiving in return.I want to assure the House that while I am committed to a successful conclusion to the round I am determined to ensure the interests of EU agriculture are not undermined for the sake of an agreement. There must be an equitable agreement which deals with all elements of the negotiations and ensures continued economic development for Ireland and the EU.

I, my colleagues in Government and my officials have taken every opportunity to make our concerns on these negotiations clear to the EU Commission in bilateral contacts and at meetings of the EU co-ordinating groups in Geneva, the Article 133 committee, the Agriculture and Fisheries Council and the General Affairs and External Relations Council. I can confirm to the House that we will continue to take every opportunity to highlight and express Ireland's concerns as these negotiations progress. At this week's Council of Agriculture Ministers meeting I informed the Commission, in no uncertain terms, of Ireland's fundamental concerns with the direction of these negotiations. This view was supported by the clear majority of member states who intervened on this issue at the meeting.

I recently met my French counterpart and I can report that Ireland and France are at one on this issue and will not accept a WTO agreement that would sacrifice EU agriculture for the sake of a deal. At this meeting we exchanged detailed views on the ongoing negotiations and it was clear we had very similar concerns about the lack of balance in the present situation and about the push for an early agreement even though many important issues have yet to be resolved. Both of us had serious misgivings about the negative impact of the current proposals on EU agriculture. We agreed it was important to communicate these concerns forcefully to the Commission and to build alliances with like-minded member states in support of our position.

This meeting was one of a series of contacts concerning WTO that I am arranging with the Commission and my counterparts in other member states. I am travelling to Slovenia next week where I will have bilateral discussions on WTO with my colleagues from other member states. I will also continue to ensure that Ireland plays a leading role in the group of more than 14 like-minded member states who have come together to express concerns about the direction of the WTO agriculture negotiations.

My objective for agriculture negotiations continues to be to ensure that the 2003 CAP reforms, which have been already implemented, and which represent the limit of the EU mandate in these negotiations are not undermined. My specific priorities in the negotiations cover the main negotiating pillars, namely, domestic supports, export subsidies, market access and non-trade concerns.

On domestic supports, my aim is to ensure the EU system of decoupled direct payments continues to qualify as non-trade-distorting payments under the WTO green box classification and so remain exempt from reductions under the new round. There can be no question of the decoupled single farm payments being undermined by any WTO proposals for reviewing the green box. This is a clear red line for the Government which cannot be crossed in the negotiations. There are threats to the definition of the green box emanating from recent discussions in Geneva and, as I mentioned earlier, from the latest paper from the Chair of the agriculture committee. I will be vigilant to ensure these threats do not come to fruition.

On export subsidies, my priority is to ensure there is full parallel elimination of all forms of export subsidy and to seek the maximum flexibility in the phasing out arrangements for the EU export refunds scheme. In the CAP health check discussions I also have been emphasising the critical importance of maintaining effective flexible market management measures, including export refunds. While export refunds remain a policy tool of the EU, they should be used by the Community whenever the situation requires. There is strong support for this position in the Agriculture and Fisheries Council.

Regarding market access, it is vitally important that Irish and EU farmers have sufficient time to adjust to the CAP reform and, in particular, the impact of the introduction of the decoupled payment system. An effective import regime has a vital role to play. Therefore, my aim is to retain the most effective level possible of protection for our producers and exporters from increased imports. I have been strongly pressing the Commission on this issue as have my colleagues in Government at every opportunity and in every available forum.

The current negotiations in Geneva are significantly focused on market access issues at present and in particular on the question of sensitive products. This is a core issue for Ireland and it is crucial that sensitive product status should deliver real and meaningful protection for key sectors of our farm economy. This is a fundamental issue for our country and I will continue to make sure the Commission is in no doubt about that. I will continue to take every opportunity to raise the issue of recognition for non-trade concerns in the WTO negotiations. The Doha mandate, which sets out in broad terms the objectives of this round of WTO negotiations, provides for the recognition of non-trade concerns in the final agreement.

I wish to repeat the strong commitment the Government and I have to achieving a successful conclusion to this round of WTO negotiations. However, other WTO negotiating partners must realise that the EU has made its contribution and it is now time for them to step up and make appropriate moves to facilitate a balanced and ambitious outcome.

I want to assure the House that I and my Government colleagues will continue to play an active role in the ongoing negotiations and vigorously pursue the key objectives I outlined today. I will also continue to work closely with the Commission and other like-minded member states to secure a balanced agreement that will benefit Ireland into the future.

I mentioned that I met the French agriculture Minister, Michel Barnier, on my second day in office. We had a useful discussion and France is like-minded on these issues. At the Agriculture and Fisheries Council meeting last Monday, I vigorously outlined our concerns to the Commission members present. I also had short bilateral meetings with colleagues from other countries. On Sunday night and Monday at the Council meeting and in face-to-face meetings with other Ministers I will emphasise our serious concerns about the negotiation and our ambition to achieve an ambitious and balanced outcome, one that does not sacrifice European or Irish agriculture.

The Taoiseach, and all members of the Government, will continue to take every opportunity available in all fora to ensure the clear message to the Commission is that we will not allow Irish or EU agriculture to be sacrificed for the sake of getting a WTO deal.