South African President Thabo Mbeki said on Wednesday new US farm subsidies, which have been condemned by Europe and most of the Third World, contradicted the country’s proclaimed support for developing economies.
”You cannot be this great proponent of free trade and then take decisions of this kind; say you are committed to the development of the developing countries and then take actions that clearly block such development,” Mbeki said in answer to a question in parliament.
Mbeki echoed last week’s criticism by Trade and Industry Minister Alec Erwin, who told reporters that new US steel tariffs and a decision earlier this month to boost farm subsidies by 67% over six years would be bad for the global economy and not just for Africa.
He said the subsidies would have the effect of blocking African access to competitive US markets.
Erwin said South Africa would work with Brazil, Australia and the 18-nation Cairns group of food exporting countries to bring the United States fully in line with World Trade Organisation (WTO) programmes, adding: ”We will fight this out.”
Mbeki, chief architect of a programme for the economic recovery of the world’s poorest continent, said on Wednesday South Africa would raise its objections in World Trade Organisation talks, at the G-8 summit in Canada in June and in bilateral talks with the United States.
”We are opposed to the position that the US government has taken on this matter. It doesn’t help at all and it has to be addressed very differently.
”It clearly is not correct. A fundamental change of direction is required,” he said.
South Africa has made substantial progress in the reform of its economy over the eight years since the end of white minority rule saw international sanctions lifted. It is switching from a raw minerals producer to become an exporter of manufactured goods and processed agricultural products.
The United States in March imposed tariffs of eight to 30% on steel imports for three years, triggering fierce rows with the European Union and Japan.
Several developing countries including South Africa were exempted from the new import curbs, but South African government and industry analysts say the tariffs are wrong in principle and warn that the exemption granted to developing countries could be reversed at any time, making forward planning difficult.
Earlier this month, President George Bush announced new subsidies for crop and dairy farmers, helping to keep domestic prices in the United States below levels that developing producers need to charge.
The G-8 is amongst groups that have endorsed Mbeki’s New Partnership for Africa’s Development (Nepad), which seeks First World financial and policy backing for a programme by Africa to develop its own economies and to introduce good political and financial governance.
Mbeki and other African leaders are due to brief the leaders of the eight most industrialised nations next month on progress towards the implementation of Nepad.
”We will make sure that this issue of agricultural subsidies is…one of the issues that will arise at the forthcoming meeting of the G-8 in Canada,” Mbeki said. – Reuters