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Two World Issues affect U.S.; EU

WTO concerned about dairy and beef trade.

Published on: Jul 8, 2009

Two issues involving the United States and the European Union were discussed during a recent World Trade Organization meeting. The issues are whether a beef import quota that the EU intends to introduce in order to settle a long-running legal dispute with the US will be available to all exporters, the EU says it will, with the other issue surrounding a number of members' objections to the EU and U.S. reintroducing export subsidies on dairy products, even if the subsidies are within the limits that the two have agreed.

The European Union's new import quota is for high quality beef. The quota would be compensation for the EU's failure to lift the ban, which has been found to violate WTO agreements. The EU rejected the suggestion that the import trade would be distorted because quantities within the new quota are duty-free whereas existing quotas, which are specific to individual supplying countries, have a 20% duty. It said the only distortion would be within the EU's domestic market.

Concerning the charge that U.S. dairy is subsidized, the United State said it was forced to re-introduce export subsidies on dairy products because other countries' subsidies were depressing prices and making the U.S. industry uncompetitive. China said the U.S. should get together with other countries to fight the subsidies instead of using them.