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WASHINGTON, DC - The US and the European Union (EU) "are seeking to work together" to narrow their differences on reforming agriculture trade in advance of a World Trade Organization (WTO) ministerial meeting in mid-September, according to US Trade Representative Robert Zoellick.

"I think the issue that is going to be the most challenging in the agriculture area is that of market access, or to put it in more plain language, cutting tariffs so you can open markets," he said in Montreal after recent meetings with 27 other trade ministers to discuss the Doha Development Agenda negotiations launched by the WTO in November, 2001.

The Montreal meeting was labeled a "mini-ministerial" in preparation for the formal WTO ministerial conference scheduled for September in Cancún, Mexico.

Zoellick said US officials see the Cancún talks as a "mid-term meeting" at which they will "try to give some impetus" to the WTO negotiations and move toward the goal of opening markets to promote economic growth and development.

In an effort to advance those talks, the US has made "bold" proposals in the agricultural sector, Zoellick said, including the elimination of export subsidies, a $100 billion reduction in domestic subsidies, and a reduction in tariffs that would leave the highest agriculture tariff at 25%.

While he complimented the EU for undertaking some reform of its common agricultural policy (CAP), Zoellick said the Us and other countries were disappointed that the EU had not yet agreed to eliminate agriculture export subsidies.

"The European Union has about $2 to $5 billion of export subsidies. We have $15 million, and I would be happy to eliminate them tomorrow if we could get the Europeans to eliminate theirs," he said.

He also said the US might agree to put disciplines on its export credit programs for agriculture if such an action would help move the EU towards eliminating export subsidies.

"If we can help create the elimination of export subsidies, that would be a big plus forward, and that is something now that I hope will push the Europeans forward because there really isn't anyone else in that category at this point," the USTR said.

Regarding market access, Zoellick said US and EU officials advocate different approaches to tariffs cuts, with the US favoring a formula that would cut higher tariffs more than lower ones, and the EU seeking a more flexible approach.

Zoellick also discussed the issue of pharmaceuticals within the WTO system and the need to ensure that the world's poorest countries have access to medicines for HIV and  AIDS, malaria and other infectious diseases.

He said the US "is willing to permit third countries to produce and export life-saving pharmaceuticals to poor countries, but only if safeguards are in place to ensure that the generic drugs cannot be diverted and re-sold to wealthier countries."

 Zoellick added that those safeguards also would have to ensure that such a program "is used for humanitarian purpose as opposed to becoming a loophole for creating a commercial export industry."

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