Groups Call For Strategy In Global Marketplace
WASHINGTON, D.C. Tes
tifying on behalf of 16 national
agricultural organizations, Dway
ne Andreas, chairman of Archer
Daniels Midland Company, called
for a U.S. trade strategy that will
enable American agriculture to be
well positioned to remain a
growth industry well into the 21st
century
Andreas told members of Con
gress that without a strategy to ef
fectively position the U.S. to com
pete in today’s post-GATT global
marketplace, “American agricul
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ture’s ability to remain viable and
competitive long term will be seri
ously threatened. Such a result,”
he said, “would not only reduce
agriculture’s ability to meet the
food and fiber needs of consumers
at home and abroad, it would also
have significant implications for
our entire economy.”
The food company executive
pointed out that agriculture is our
nation’s largest single industry
bigger than General Motors,
Chrysler, and Ford combined
and accounts for nearly one out of
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every six jobs. As a result, our
economy is heavily dependent on
agriculture’s ability to compete in
the global marketplace.
“Yet, in the context of debate
on the budget and the *1995 Farm
Bill, we hear it said that now is the
time to sharply reduce or even
eliminate many of our existing po
licies and programs, and simply
allow the free market to work,”
Andreas said. “Well, let me tell
you, when it comes to agriculture,
there is no such thing as the free
market.”
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He explained that every country
in the world has a set of policies
and programs designed to help it
meet the food needs of its citizens
and to capitalize on potential trade
opportunities. “The GATT agree
ment has not changed this.” he
said. “It did not eliminate the use
of export subsidies or other unfair
trade practices. It only reduced
their overall level.”
Between 1990 and 1994, the
European Union spent on average
$10.6 billion annually in export
subsidies, while the U.S. spent
less than $2 billion. Since the
GATT agreement requires all
countries to reduce subsidies by
the same relative percentage, the
European Union will still be able
to maintain its historical advant
age. In addition, many of our ma
jor competitors are also moving to
increase their use of non-trade dis
torting programs to maintain and
expand their share of the world
market. Without a similar com
mitment, American agriculture
will be at a serious disadvantage.
“This is the real world of global
competition,” Andreas said.
“America’s farmers and ranchers
are the most competitive in the
world. But in today’s global mar
ketplace, that is not enough. We
must have policies and programs
that are equally competitive with
those of other countries against
whom we must compete. We can
not and should not expect Ameri
can agriculture to compete alone
against foreign governments.”
The ADM chairman outlined
five points that an overall trade
strategy should contain:
• Ensure that other countries
fully live up to the terms of their
commitments under GATT, espe
cially with regard to market ac-
Lancaster Farming, Saturday, Juna 3, 1995-El7
cess.
• Ensure that U.S. policies re
main equally competitive with
those of our foreign competitors,
including full funding for direct
export, export credit, market de
velopment, promotion, and food
assistance programs.
* Be flexible to allow both
USDA and industry to respond to
the changing dynamics of the glo
bal marketplace.
• Provide for investment in re
search and development, includ
ing new technologies and alterna
tive uses, improve productivity,
expand demand, and enhance
American agriculture’s overall
competitiveness.
• Provide for investment in
long-term economic and market
development, involving the pri
vate sector rather than simply re
lying on government to govern
ment transactions.
Andreas concluded by noting
that between now and the year
2000, most of the world’s popula
tion growth will occur in the non
industrialized world. “These
countries represent developing
and emerging new markets for
U.S. agriculture,” he said. “But
only if we develop a strategy to
capitalize on such opportunities.”
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