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Brazil seeks support for 50% cut in agricultural subsidies

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Brazil, Canada, Australia and New Zealand urged other countries to strive together, "side by side", in World Trade Organization (WTO) negotiations and be flexible to reduce by 50% the subsidies that distort the global agricultural trade.

According to last year's proposal made by exporters off the Davos Forum, the countries that grant the most trade-distorting subsidies in agriculture should cut much more. In this group are China, India, United States, European Union and Japan.

A survey by the Cairns Group, which gathers exporters, pointed out that those distorting subsidies will reach $2 trillion in 2030 if there is no change. In 2016, they reached $772 billion. By distorting subsidies, for example, they mean the minimum prices policy and payments for the producer not to produce, thus keeping the price under control.

The discussions continue, and it is in this context that Brazil and other major exporters - excluding the USA and the EU - are trying to persuade several developing countries to accept the inclusion in the negotiation of the so-called "development box", with which they can give unlimited subsidies for rural development.

Under the current agricultural agreement, 124 countries have the right to use the 'development box', that is, to grant this type of subsidy. Since 2001, however, only 50 members have done so. And only five have concentrated 93% of spending.

Of the $31 billion disbursed in 2016, India alone was responsible for granting $22.8 billion, followed by Indonesia ($2.7 billion), Thailand ($1.8 billion), Turkey ($930 million) and Brazil ($730 million). In 2018, Brazilian spending on this development fund fell to $108 million, while Indians' rose to...

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