US embassy cable - 05PARIS6631

UNCLAS SECTION 01 OF 02 PARIS 006631 
 
SIPDIS 
 
BRUSSELS PASS USEU FOR AGMINCOUNSELOR 
STATE FOR OES; EUR/ERA; 
STATE PASS USTR FOR MURPHY, NOVELLI; 
USDA/OS/JOHANNS AND PENN; 
USDA/FAS FOR OA/TERPSTRA/ROBERTS; 
ITP/SHEIKH/HENKE/MACKE/TOM POMEROY/MIKE WOOLSEY; 
FAA/SEBRANEK/BLEGGI; 
EU POSTS PASS TO AGRICULTURE AND ECON 
GENEVA FOR USTR, ALSO AGRICULTURE 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: EAGR, ETRD, PGOV, FR, WTRO, EUN 
SUBJECT:  Secretary of Agriculture Mike Johanns meeting with 
French Ag Minister Dominique Bussereau 
 
1.  INTRODUCTION AND SUMMARY: (SBU) After opening 
cordialities, Minister Bussereau implicitly referred to the 
previous day's meeting between Secretary Johanns, USTR 
Portman and their EC counterparts, stating that whatever the 
EC negotiates will have to be approved by all 25 Member 
States.  He stressed that the EU was prepared to make 
concessions on market access only if others were willing to 
make reciprocal concessions.  He said that a Doha agreement 
would have to be compatible with CAP reform and that the EU 
can't sign on to Doha without agreement on geographical 
indications.  Secretary Johanns stressed that the model for 
Doha should be to encourage trade and open markets via 
reducing export subsidies and tariffs, and that the EU 
should move toward this model, applying a scientific 
approach to issues such as biotech and hormone-fed beef. 
 
Participants on the U.S. side were: Mike Johanns, Secretary 
for Agriculture, Craig R. Stapleton, U.S. Ambassador to 
France, Dr. J.B.Penn, Undersecretary for Farm and Foreign 
Service, Ellen Terpstra, Administrator, Foreign Agricultural 
Service, Elizabeth B. Berry, Minister-Counselor for 
Agricultural Affairs, Thomas J. White, Minister-Counselor 
for Economic Affairs, and Xavier Audran, Agricultural 
Economist. 
 
Participants on the French side were: Dominique Bussereau, 
Minister for Agriculture and Fisheries, Michel Cadot, 
Director of Cabinet, Franois Riegert, Deputy Director of 
Cabinet, Jean-Marie Aurand, Director for Economic and 
International Policy, Raphael Alomar, Adviser for 
International Affairs, and Jonathan Derai, Deputy-Adviser 
for Diplomatic affairs 
 
2. (SBU) After pledging French support for U.S. hurricane 
victims, Minister Bussereau focused on the WTO negotiations, 
stating that although some progress has been made in 
agriculture, not much progress has been made on services and 
industrial goods.  He stated that the EU has already 
decoupled domestic support, making its ag policy compatible 
with WTO parameters.   Further, he asserted that the EU 
couldn't undertake additional reforms given that decoupling 
is new for its farmers and is less advantageous than the 
previous system.  Implicitly referring to the previous day's 
meeting between Secretary Johanns, USTR Portman and their EC 
counterparts, he said that whatever the EC negotiates on 
market access, subsidies and domestic support will have to 
be approved by all 25 Member States. 
 
3. (SBU) Secretary Johanns expressed the hope that further 
progress on the ag pillar could be made before the Hong Kong 
summit.  He emphasized President Bush's comments about the 
need to eliminate trade-distorting subsidies at the G-8 
summit and the United Nations.  While acknowledging that 
reform of the Common Agricultural Policy (CAP) was a step in 
the right direction, he underscored the fact that the EU's 
level of ag subsidies remains the highest in the world.  He 
also emphasized the degree to which the EU has benefited 
from the U.S.'s relatively low tariffs and open markets, and 
that U.S. farmers want reciprocal business opportunities in 
Europe.  He underscored the need to convince our Congress 
that a WTO agreement will result in opportunities for U.S. 
farmers in the EU market.  He also made a strong argument 
that we must address market access and trade-distorting 
subsidies to help raise the standard of living in the 
developing world. 
 
4. (SBU) Minister Bussereau stated that the EU is already 
the largest importer of ag products from developing 
countries and referred to the Everything but Arms program. 
He said that tariff cuts would benefit the wealthy segments 
in the Cairns countries rather than farmers in the 
developing world.  He added that per capita subsidies in the 
U.S. were higher than in Europe, according to OECD data. 
With regard to export competition, the Minister said that 
France was willing to eliminate export subsidies in exchange 
for "parallelism" from others, e.g. U.S. food aid reforms. 
He added that the EU was prepared to make concessions on 
market access if others were willing to make concessions, 
stating that he thought the Uruguay Round framework provided 
a better basis than the G-20 proposal for market access 
discussions.  He said that a Doha agreement would have to be 
compatible with CAP reform and that the EU can't sign on to 
Doha without agreement on geographical indications. 
 
5. (SBU) Secretary Johanns said that food aid represents a 
small fraction of U.S. ag exports and that we should be 
doing more in ways that are more efficient, rather than 
tying the hands of donors.  He also noted that dollarizing 
food aid is not a good solution because of corruption. 
Regarding domestic support, the Secretary again noted that 
CAP reform was a step in the right direction and that if the 
model is decoupling that the US should move in that 
direction.  Moreover, he emphasized, if the model is to 
encourage trade and open markets via reducing export 
subsidies and tariffs, the EU should move toward the U.S. 
model.  He added that the EU should harmonize its 
regulations on biotech and hormone-fed beef, concluding that 
U.S. farmers would like to have the same opportunities in 
Europe that EU farmers have in the U.S. 
 
6. (SBU) Minister Bussereau said that progress can only be 
made at Doha if everybody makes concessions on all three 
legs of the negotiations.  He added that the US and the EU 
shouldn't disrupt their marketing systems for developing 
countries since such changes wouldn't significantly help the 
poorer countries.  He said that there are several "red 
lines" for France such as non-disruption of the CAP.  He 
added that Europe has made some political choices, e.g. 
traceability, protecting the rural environment, and 
protecting, preserving and promoting the rural way of life, 
which is "the soul of Europe." 
 
7. Secretary Johanns replied that we shouldn't respond to 
the Brazil challenge by raising tariff barriers. He said 
that the U.S. believes in an open market policy and is ready 
to make concessions as we're asking the world to do. 
 
8. (SBU) Minister Bussereau said that a balance was needed 
and that the Council of EU Ag Ministers was ready to talk 
but that any agreement must be based on reciprocity.  He 
said that he was satisfied with the US/EU wine accord, 
although it was only a first step.  He hopes to attain 
further progress on EU appellations of origin.  On food 
safety matters, he asked for more USG flexibility on issues 
such as regionalization.  He noted that the U.S. meat 
industry was working on an agreement with Japan and said 
that the EU would like a similar agreement.  He expressed 
appreciation for the lifting of the U.S. delisting of French 
foie gras plants and said that France wanted a solution on 
the wine bottle crate issue.  He noted the Forestry MOU 
signed in July and emphasized that there was a lot of room 
for cooperation between the U.S. and France in the forestry 
and bioenergy sectors. 
 
9. Secretary Johanns said the U.S. was interested in moving 
towards a more regional approach on phytosanitary issues and 
that decisions should be made in a science-based manner.  He 
stressed that a science-based approach should be used in 
addressing BSE, biotechnology and the beef hormone issue. 
He agreed that the forestry sector afforded many positive 
opportunities. 
 
10.  Minister Bussereau thanked the Secretary for the useful 
exchange of views and invited him to return to France. 
 
STAPLETON