EU Export Subsidies: A Step Backwards

9 February 2005

The Cairns Group is extremely disappointed at the decision by the European Union to re-introduce export refunds on wheat.

Export subsidies are universally recognized to be the most pernicious form of agricultural support. This form of subsidy has a very direct and harmful impact on the prospects of farmers in other countries, including those in developing countries.

The EU’s reversal of direction on export refunds sends a poor signal at a time when leadership from the major WTO Members is critical to moving the negotiations forward. The decision underlines the importance of moving quickly to implement the decision to eliminate export subsidies and substantially to reduce the massive levels of trade-distorting domestic support which are artificially encouraging over-production.

The Cairns Group calls on the EU and other major agricultural subsidizers to use the opportunity of the Doha negotiations to refrain from pushing the costs of their domestic and export support programs onto the rest of the world. The burden of these policies is most commonly borne by farmers in those countries, particularly developing countries, which cannot afford to compete in farm subsidy wars.

In recent years we have welcomed EU reform of the Common Agricultural Policy and its recognition of the need to eliminate export subsidies. It would be unfortunate if this recent decision were to suggest a weakening of EU commitment to reform of the CAP and to elimination of export subsidies.

The Cairns Group will continue to press all WTO Members to show genuine commitment to the goal of a fairer global trading environment for agriculture and looks forward to elimination of all export subsidies in as quick a time frame as possible.

Last Updated: 24 February 2016