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July 04, 2005

Ooooh, Yes Please!

I doubt very much that it will actually happen but what glories if it did! What a boon, a joy to behold. Tell the farmers, both European and American, to bugger off and make their own money:

PRESIDENT BUSH yesterday challenged EU leaders to scrap massive subsidies paid to their farmers, saying free trade with Africa would eliminate the need for Third World aid.

Mr Bush, on the eve of the G8 summit in Gleneagles, said that Europe paid “tremendous” agricultural subsidies, and that the US was ready to drop its own payouts to American farmers if Europe had the courage to do the same.

Mr Bush’s challenge — in an interview with Sir Trevor McDonald to be screened by ITV tonight — is likely to be rejected not only by France and Germany, but by many in his own country. But it appeared to be a bold rhetorical step by his Administration to get the world’s richest nations away from talk of aid and toward free-market solutions in the quest to alleviate poverty in Africa.

Asked directly if America would drop its subsidy system if the EU abandoned the Common Agricultural Policy (CAP), Mr Bush said: “Absolutely. And I think we have an obligation to work together to do that.

“Because if we do achieve this business of free trade, and if markets in the West are opened up to countries in Africa, they could be so successful, they could eliminate the need for aid. The benefits that have come from opening up markets — our markets to them and their markets to us — far outweigh the benefits of aid.”

Mr Bush’s call to scrap agricultural subsidies in the developed world follows that of Tony Blair, who recently said the system of over-generous subsidies was “hypocrisy” that could no longer be ignored.

Just one further point needs to be made. The subsidies and protectionism cannot simply be replaced by non-tariff barriers. Such as, say, the EU’s "Farm to Fork" programme. Sadly, the very reason that has been introduced is to put non-tariff barriers in the way of foreign farmers, to stop them selling to us as and when the tariff barriers come down.

July 4, 2005 in Make Poverty History | Permalink


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Is there a different George Bush somewhere pretending to be the president of America? This is a sensible suggestion and it might benefit somebody other than the US. It doesn't sound like GW. :D

Posted by: wonkotsane | Jul 4, 2005 10:48:27 AM

wonkotsane: I think we read here (and elsewhere) often enough that removing trade barriers benefits everyone, including Americans (if perhaps not all the receivers of their subsidies). And if there are lots of rich Africans to purchase my products, than so much the better.
You're right that it's unusually liberal to hear from George W. though....

Posted by: in actual fact | Jul 4, 2005 11:39:55 AM

Here a nice article on the scrapping of agricultural subsidies in New Zealand where a "coalition" of farmers and Greens now opposes any return of subsidies.

Posted by: ivan | Jul 4, 2005 1:42:18 PM

Honestly having looked at CAP a little more I now think it isn't the demon some make it out to be. CAP stands for Common Agricultural Policy. That is Agriculture NOT Farming. I realise this may seem complex but in countries like Austria and Switzerland (not EU) they spend a fortune maintaining picturesque postcard scenery and if they spend a fortune per cow, so what? These cows are providing a minute amount of produce at best. Other EU farmers are paid stupid amounts to NOT farm. The French are subsidised to make cheeses that no-one really buys anyway.
If they weren't paid for by CAP then organisations like English Heritage would be paying for small chedder cheese producers or gamekeepers to keep grouse and pheasants. None of these activities particularly harms the trade in food but does protect European culture. Unlike US farm susbsidies which DO almost exclusively subsidise food production.

I don't see Africa in a position to be selling us meat or staple grains. Not with all their starving :P Nor do I see them producing quality wines, beers or cheeses. It seems to me the problem is NOT CAP but import tariffs especially on processed goods (eg coffee).

Posted by: Monjo | Jul 4, 2005 3:52:17 PM


I tried some absolutely fabulous Zimbabwean wine some years ago - it would be great if we could get it here. Beer is very widely produced in Africa (and not just South Africa either). Why can't we try it here?

Posted by: Bishop Hill | Jul 4, 2005 9:43:55 PM

Monjo, I believe you are incorrect. The EU CAP is responsible for considerable overproduction of agricultural products. The policy effectively blocks many external producers selling into the EU, and worse, uses export subsidies to undercut markets elsewhere in order to dump the surpluses.

Posted by: Ed Snack | Jul 4, 2005 11:49:26 PM

Beer is very widely produced in Africa (and not just South Africa either). Why can't we try it here?

You're definitely not going to the right off-licenses! (beer isn't covered in the CAP and the only duties payable are the standard excise duties). Mine's a Nigerian Guinness...

Posted by: john b | Jul 5, 2005 9:25:56 AM

I think Bishop Hill still thinks Zimbabwe isn't ruled by a tyrant who has destroyed all the farms and left half the country starving. Yes CAP has a few problems (mostly for cererals and mass meat production) but I think there are other aspects of CAP which if we scrapped CAP we'd still want to maintain European agriculture.

My point was that scrapping CAP or making CAP out to be only bad is wrong. Can you imagine taking a train ride through England and there's no fields, no cows, no scarecrows, just nothing.

If African GDP were on EU levels they'd be what $16,000,000,000,000 richer a year? ($20k/person * 800 million people) Honestly, the trifling amount spent of CAP is not what's keeping them poor. To say that it is is pure BS.

If Africa had stayed at the same relative % of GDP it was the the UK when the empire ended (25pc) then it would have a combined GDP around $6.8trillion/yr now.

Posted by: Monjo | Jul 5, 2005 2:09:03 PM

"Can you imagine taking a train ride through England and there's no fields, no cows, no scarecrows, just nothing.": Monjo.

Sounds terrible! When can we plant crops in the yorkshire dales and peak district?

Posted by: Rob Read | Jul 5, 2005 4:42:01 PM