MONTREAL -- Both the United States and the European Union must show leadership on reducing agriculture subsidies, federal International Trade Minister Pierre Pettigrew said Monday.
He made the comments amid reports some developing countries have threatened to abandon ongoing trade talks because of their frustration over the subsidies.
Canada is hosting a World Trade Organization meeting that includes about 25 trade ministers from selected WTO-member countries.
A major sticking point for Canada and developing nations is the elimination of about $300 billion US in annual farm subsidies they say depress international prices.
"I expect both the European Union and the Americans will show the leadership that we expect from them," Pettigrew told a news conference on the first day of the meeting.
"They have impressive economic might and I believe that with that goes the political responsibilities of moving things on."
He cited domestic subsides the United States gives its cotton farmers and export subsidies provided by the EU.
Pettigrew noted the WTO-member countries agreed to eliminate export subsidies after a meeting in 2001 in Doha, Qatar.
He added Canada has eliminated 80 per cent of its agricultural subsidies over the past 10 years and is prepared to go even further.
But Mark Fried, advocacy co-ordinator for Oxfam Canada, said developing countries have threatened to abandon the talks because the world's most powerful nations won't drop the trade barriers.
"Everyone is waiting for the United States and European Union to move," Fried said after a meeting with Pettigrew and several non-governmental organizations.
"Well, they don't want to move because the current system benefits them.
"This is tragic because thousands, I would say millions, of poor farmers across the world are losing their livelihoods today under this regime and things have to change."
He added that access to medicine is another key issue that has yet to be resolved.
But all sides appeared to be blaming others Monday for the lack of progress.
Speaking in Washington, D.C., EU Agriculture Commissioner Franz Fischler said his organization has already taken major steps to curb agricultural subsidies.
EU agriculture ministers said last month they would reduce direct payments for larger farms, among other measures.
But Fischler said EU trading partners have not made similar moves.
"This will only work if our trading partners also show their willingness to contribute, rather than camping on extreme positions," Fischler said in a statement, without naming specific countries.
"So far, I have seen disappointingly little flexibility in other camps."
Canada and the 145 other WTO countries want to conclude the latest round of trade talks by Jan. 1, 2005.
The WTO meeting in Montreal, which ends Wednesday, is in preparation for a crucial meeting in Mexico in September, the midway point to the self-imposed deadline.
Supachai Panitchpakdi, head of the WTO, said talks were progressing slowly and he urged ministers at the Montreal meeting to be more flexible.
"Failure is not an option," Supachai told a news conference.
"If we fail, the signals beyond 2005 to the global community would be the failure of the multilateral system at a time when we need the multilateral system to provide us with more market access."
Neither Supachai nor Pettigrew said they were prepared to scale back their expectations in order to reach a deal.
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