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WTO members concerned over U.S. farm spending, EU's Brexit plans

WTO members concerned over U.S. farm spending, EU's Brexit plans
FILE PHOTO: A logo is pictured outside the World Trade Organization (WTO) headquarters next to a red traffic light in Geneva, Switzerland, October 2, 2018. REUTERS/Denis Balibouse -
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Denis Balibouse(Reuters)
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GENEVA (Reuters) – China, India, the European Union, Ukraine and Australia told the World Trade Organisation on Wednesday that U.S. farm subsidies risked distorting global markets, and said they feared such funding would be repeated, a Geneva trade official said.

Many countries also raised concerns about the EU’s proposed handling of agricultural tariff rate quotas under a no-deal Brexit, fearing they would lose market share if Britain started competing as an exporter to the bloc.

Washington told the WTO’s agriculture committee in February that a $12 billion “market facilitation package” to assist farmers hit by trade disruptions would be a one-off. But last month it announced a second tranche of up to $16 billion.

A U.S. diplomat told the committee on Wednesday that $8.57 billion (6.75 billion pounds) had been paid out for the 2018 crop year as of June 7.

An Australian diplomat said the U.S. subsidies were equivalent to two-thirds of Australia’s entire agricultural output and the policy risked distorting the world market, the official said.

An EU official at the meeting agreed, saying the “unprecedented” measures would affect world prices and trade flows, even if the subsidy did not break the limits allowed by the WTO.

China’s representative said: “We appreciate the U.S. respects the interest of farmers, but we will appreciate if the U.S. can also respect the WTO rules.”

The EU’s Brexit-related plans meanwhile triggered unease from diplomats from Canada, Australia, China, Uruguay, Paraguay, Russia, the United States and New Zealand.

Australia also raised concerns about a plan to compensate Irish beef farmers if prices suffered due to Brexit, with 50 million euros offered by the EU and potentially another 50 million euros from the Irish government.

The EU representative said the legislation on the details had not yet been adopted, and Ireland had until July 31 to explain how it planned to implement the measures. The EU did not have plans to compensate other farmers, its official told the meeting.

(Reporting by Tom Miles; Editing by Catherine Evans and John Stonestreet)

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