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Farm policy is main block in West's trade talks

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The conclusion of trade talks among representatives of the United States, the European Community, Japan, and Canada this weekend has set the stage for contentious discussions in the weeks and months ahead. The trade officials -- representing countries that acccount for nearly half of all world trade -- met in an effort to forge a common negotiating strategy in advance of next Monday's round of global trade-liberalization talks by the 92-nation GATT (General Agreement on Tariffs and Trade).

US Trade Representative Clayton Yeutter emerged from the talks, held in this sunny mountain resort town west of Lisbon, to announce confidently that the participants had agreed ``on almost everything.''

For his part, the chief delegate of the European Community (EC), External Relations Commissioner Willy de Clercq, proclaimed that the weekend meeting had revealed a ``very large consensus'' and had helped the ministers understand ``the reasons behind our respective positions.''

Beneath the rosy rhetoric, however, the Sintra discussions demonstrated that progress at next week's GATT talks, in Punta del Este, Uruguay, will be slow and difficult as governments struggle to resist growing protectionist pressures back home. Initially set up in 1947 to provide a temporary framework for tariff negotiations, GATT's purpose is to promote the expansion of international trade along agreed-upon lines of reciprocal rights and obligations.

The ministers did manage to reach broad agreement on the issues they think should be discussed during the new GATT round -- namely those of free trade in agriculture and services.

But substantial differences remain on precisely how the liberalization of trade in certain key sectors should proceed -- and to what extent.

The main stumbling block continues to be agriculture.

Highly sophisticated farming methods in many industralized countries have massive unsold food surpluses.

Yet for decades, the EC has subsidized farm exports to help boost sales. Although it is not illegal under GATT rules to do so, other farming nations -- including the US -- have argued that the practice is unfair and discourages free-market trade patterns.

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