WESTERN BUREAU — United States Ambassador to Jamaica, Sue Cobb, maintained Friday that the new US Farm Bill, which gives millions of dollars in subsidies to American farmers, was consistent with World Trade Organisation (WTO) rules.

At the same time, she said the US imposition of tariffs on steel did not break WTO rules and that they were, in fact, only temporary and affected a few trading partners.

“The steel action only affected one particular kind of steel and it is a tiny fraction of all the steel imported in the US,” Cobb told an American Chamber of Commerce in Jamaica function in Montego Bay. “It was, and is, a temporary measure. It affects few trading partners and it’s fully consistent with US obligations under WTO.”

According to Cobb, the Farm Bill subsidies are consistent with current WTO rules that provide levels of protection to all member countries. “If these rules need to be adjusted or tightened, the WTO Doha development round of negotiations coming up soon is the place to do it,” she said.

The ambassador added, however, that should the new WTO agriculture agreements conflict with the Farm Bill, then it is the bill that would change.

In the interim, she said, US farmers needed to maintain their competitive edge against other countries that were the beneficiaries of larger subsidies.

“In the meantime,” said Cobb, “American farmers must compete with Japanese farmers, who receive 50 per cent more subsidies than US farmers. And European farmers, who can have, under their WTO levels, up to triple the amount of subsidies of the US. As a matter of fact, when you look at the numbers, the US has one of the lowest levels in the world on subsidies of any kind.”

She said that nothing would please the US more than strong international rules limiting all harmful subsidies. “The key point is to understand that the US remains fully committed to the completion of both the FTAA and the WTO Doha development rounds by 2005. These remain the pillars of our foreign economic vision.”

Trade ministers from the 15 Caricom member states have expressed concern about the negative effects the US farm bill, which they say violates WTO rules by boosting subsidies by over 70 per cent, could have on their economies.

The bill, which was commissioned by US president, George Bush, just over two weeks ago, authorises $180 billion in spending on US farmers over the next 10 years, a $73.5-billion increase over existing programmes.

In the wake of these changes, head of Caricom’s Regional Negotiating Machinery, Richard Bernal, has said the US was sending an “unfortunate signal” even as it pushed smaller economies to open their markets under the Free Trade Areas of the Americas (FTAA) arrangement to come on stream in 2005.

But Cobb insisted Friday that the US was committed to a prosperous and free hemisphere and to the completion of both FTAA and the WTO Doha development round in the next three years.

“An open economic environment creates a self-fulfilling cycle of human creativity and self-fulfillment, competition, productive investment, stronger financial markets, rising living standards, expanded resources for further innovation choices,” she said.

“Governments have tried to boost competitiveness in many different ways. The most successful do it by creating investment-friendly environments with flexible market approaches to leverage the innate capacity of creative human beings.”