EC Agrees to Farm Subsidy Cuts

The 12-nation European Community on Tuesday approved a plan for moderate reductions in farm subsidies, resolving an impasse that had threatened to scuttle next month’s world trade talks.

The proposal calls for trimming government payments on major farm crops by 30% over 10 years starting in 1986. Some cuts have already been made.

The EC had failed to agree in six previous attempts.

The plan now will be presented to negotiators in the Uruguay Round talks, an ambitious four-year effort by about 100 nations to overhaul the world trading system. Those talks are being held under the auspices of the General Agreement on Tariffs and Trade, a forum that advocates freer world trade.

After two days of bargaining, the European trading bloc’s agriculture and trade ministers endorsed a carefully worded proposal that sought to ease fears of some governments that the reductions would badly hurt their farmers.

French Agriculture Minister Louis Mermaz, who had been holding up the agreement, described the outcome as “excellent.”

Mermaz said the proposal “will enable the European Community to start the negotiations with a united front, with an excessively dynamic position.”

The EC is the last major player to put its offer on the bargaining table, having missed an Oct. 15 deadline for submitting positions for the final round of negotiations, which will begin in less than a month.

It is unlikely, though, that the offer will be warmly received by the United States and other nations, which have demanded much greater reductions in the EC’s costly farm support programs.