By Daisy Ayliffe - 8th December 2005
A whole-scale review of EU budgets in 2008 “could help” Europe on the world trade stage, European Trade Commissioner Peter Mandelson acknowledged on Thursday.
The British EU presidency has proposed that Europe’s financing for 2007 to 2013 be reviewed midway - London has suggested such a move could see big cuts in spending on farm subsidies before 2014.
France is up in arms over British plans to hold a whole-scale review of EU finances two years into the new budget at the end of 2008.
Paris fears the review clause will be an excuse to open the door to cuts in farm subsidies.
“France will accept a review of all spending on condition that it does not single out any area… and that any decisions that come as a result shall not be implemented before 2013,” French finance minister Philippe Douste-Blazy insisted on Wednesday.
But others argue that commitment to an early review of Europe’s agricultural policy could strengthen the commissioner’s hand in WTO trade talks.
Calling for focus on EU offers made in the WTO talks, Mandelson insisted he would not let rows over the financial perspectives distract him in China.
“CAP reform in 2008 or 2009 could be helpful," he said.
“Let’s base negotiations on what is being done now and what we have on the table now."
While the commission has consistently ruled out offering the WTO anymore on agriculture, Mandelson said he may be prepared to make his proposals more appealing if other big players were also prepared to budge.
“If others are serious, I would be prepared to discuss our offer to see if we could make it more interesting to them,” Mandelson explained.
But he stressed that as the talks are currently poised, Europe has no desire to move first because talks have already been too heavily focused on agriculture.
“In Hong Kong we will ask if needs can be accommodated but we would lose EU support if we gave more on agriculture. Member states do not see enough from others in other areas.”
“Not one single member state has requested I make another offer on agriculture,” he said. “And no one should be surprised by this - we are at the outer limits of our mandate and there is no incentive to."
Brussels says incentives should take the form of firm commitments from Brazil and India on industrial goods and services.
“Brazil and India should make firm and clear offers that create real market access for industrial good and services,” Mandelson stressed, calling for firm commitments to enable the impasse to be broken and talks to go forward.
“Floated ideas and half made suggestions are no good,” Mandelson added - a reference to Brazil’s stated “willingness” to move on the issue.
“At the London meeting of G7 finance ministers Brazil said they were ‘willing’ to move. Willing is the key word there - but it is not so much a statement as an offer that we want.”
Mandelson will head to Hong Kong on Saturday morning with EU Agriculture Commissioner Marianne Fischer-Boel.
The pair arrive in China will reduced expectations for the global trade deal.
“I regret we will not be finalising the Doha Round,” Fischer Boel said on Thursday.
“Progress has been made and there are offers on the table from all of the biggest players. But some of those offers contain black holes so we are a long way from consensus.”
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