U.S., EC Reportedly Are Near a Settlement on Farm Subsidies

The United States and the European Community on Monday appeared close to settling a dispute on farm subsidies that has been the main obstacle to concluding a global trade pact. But France called the progress inadequate.

U.S. Agriculture Secretary Mike Espy hinted that the United States and the 12-nation trading bloc had settled a bitter dispute over cuts in government payments to farmers.

U.S. Trade Representative Mickey Kantor continued deliberations with his EC counterpart, Sir Leon Brittan, in an effort to clinch an overall deal that would save the protracted trade talks from collapse.

The French, however, who have threatened to block any deal they don’t like, characterized the talks in much more critical terms, saying the agreement still didn’t meet their concerns about protecting France’s farmers.

“We need more progress,” French Foreign Minister Alain Juppe said as he entered EC headquarters to talk with Brittan.

Arriving at EC headquarters, Kantor said chances were “pretty good” for an accord.

After nearly five hours of talks, Espy emerged with EC farm chief Rene Steichen and said the two had concluded “very productive” talks on agriculture.

Neither Espy nor Steichen gave details of their discussions.

But other officials said the United States backed down and agreed to reopen an agreement reached last year to make sharp cuts in the EC’s subsidized farm exports.

In return, Washington was promised increased sales for some of its agricultural products in Europe, they said.