EU resumes ag subsidies

The European Union decision to resume export subsidies on butter, cheese and milk powder which were suspended a couple of years ago is a blow to free trade hopes and our dairy industry.

The world milk price has fallen steeply in recent months, the EU is already subsidising butter storeage and the new subsidies will encourage further supply which is unrelated to demand.

Trade Minister Tim Groser and Agriculture Minister David Carter say it’s a negative signal when so much effort is going in to reducing protection.

Groser said this makes completion of DOHA negotiations even more urgent and Dear John says the prohibition of these subsidies should be the number one goal of current WTO negotiations.

New Zealand farmers were brought kicking and screaming into producing without subsidies in the 1980s. The pain at the time was intense but farmers are more efficient and more secure now than we ever could be with subsidies.

This message has still to get through to producers, manufacturers and politicians in other parts of the world and  everyone is paying the price of unsustainable production because of that.

3 Responses to EU resumes ag subsidies

  1. JC says:

    This is a shocker. If there was one huge lesson to come out of the Great Depression, it’s that closing off free trade dramatically made it worse.

    All eyes on Obama now.

    JC

  2. Mark says:

    I agree, protectionsim was the main cause of the Great Depression.

    The EEU are retards.

  3. Mr Dennis says:

    Dead right, this is just going to make things worse. JC, it is extremely worrying that going into this mess we end up with the most socialist US president in history. I expect him to follow suit and copy the EU way of doing things, potentially turning a downturn into a disaster. Hopefully I am wrong.

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