This record is a partial extract of the original cable. The full text of the original cable is not available.

311711Z Mar 06

UNCLAS SECTION 01 OF 04 PARIS 002136 
 
SIPDIS 
 
SENSITIVE 
 
BRUSSELS PASS USEU FOR AGMINCOUNSELOR 
STATE FOR OES; EUR/ERA AND EBB ; 
STATE PASS USTR FOR MURPHY; 
USDA/OS/JOHANNS/PENN AND TERPSTRA; 
USDA/FAS FOR OA/YOST/ROBERTS; 
ITP/SHEIKH/MACKE/TOM POMEROY/MIKE WOOLSEY/GREG 
YOUNG; 
FAA/SEBRANEK/BLEGGI; 
EU POSTS PASS TO AGRICULTURE AND ECON 
GENEVA FOR USTR, ALSO AGRICULTURE 
 
E.O. 12958: N/A 
TAGS: EAGR ETRD EU FR
SUBJECT: DOHA : FRANCE MAINTAINS HARD-LINE 
POSITION, SEEKS LIMITS ON EU MANDATE 
 
 
SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET 
 
¶1. (SBU) Summary : Both PM De Villepin and AgMin 
Bussereau stated publicly their belief that other 
countries now need to respond to EU "Concessions" 
on agriculture in the Doha Development Round 
negotiations. FAS Paris contacts echoed these 
remarks and said that offered U.S. reforms were 
not "sufficient". GOF officials will continue to 
highlight their hard-line stance, for their base 
particularly, given the other economic problems 
the Government is facing.  End Summary 
 
¶2. (SBU) Both Prime Minister Dominique de Villepin 
and Agricultural Minister Dominique Bussereau 
delivered keynote speeches at the annual 
conference of FNSEA, the main French farm union, 
which was held in Metz on March 22-23. The WTO 
negotiations were among the first topics mentioned 
in both their speeches in which they essentially 
asserted that the EU had made its share of 
concessions and it was now up to other (e.g. the 
United States, Brazil) to follow. Both also 
asserted that failure to reach an agreement would 
be preferable to a bad agreement.  Following up on 
the conferences, AgMinCouns also met with Raphael 
Alomar, Diplomatic Adviser to AgMinister 
Bussereau, and with Herve Lejeune, Agricultural 
Adviser to French President Jacques Chirac. 
 
¶3. (SBU) Just days before the London Ministerial, 
France sent a memorandum to the European 
Commission, signed by a number of European 
AgMinisters, reiterating its hardline position on 
the agricultural negotiations (see below). Both 
politicians and contacts met by FAS Paris insisted 
that the declaration of Hong Kong and the 
abolition of EU export subsidies by 2013 were 
agreed upon under the condition that EU trading 
partners would also abolish their export supports. 
Lejeune explicitly mentioned the U.S. food aid 
programs and export credits as important issues 
for France. When AgMinCouns cited reforms to these 
programs, Lejeune replied that these were not 
sufficient. In addition, Lejeune referred to the 
issue of State Trading Enterprises. 
 
¶4. (SBU) When asked about a possible EU TRQ offer 
on sensitive products, Lejeune said that the 
Commission continued to withhold such information 
from the Member States. He also referred to a rift 
between EU farm and food industry interests, 
emphasizing the need to deal with them separately, 
using the issue of sugar as an example. 
 
¶5. (SBU) France continues to claim that the EU 
offer of October 28 is already beyond the 
negotiating mandate of the Commission and that it 
can not go any further. France explicitly links 
the agricultural market access issue to NAMA 
negotiations. Both Alomar and Lejeune blamed 
Brazil for blocking the negotiations.  However, 
during the discussion, it appeared that, if France 
can claim significant advances on the NAMA issue, 
it would be open to more flexibility on the 
agricultural side, especially regarding sensitive 
products. France does not want to be in a "lose- 
lose" position at the end of the negotiation, 
which would be politically difficult to sell to 
the farm community and to the French public, at a 
time close to the Presidential elections of May 
¶2007. As mentioned by Alomar, any advance on the 
GI issue could also soften France's position on 
the other pillars. 
 
¶6.  (SBU) De Villepin also stressed that the EU 
has already reformed its internal farm support 
policy, making it WTO compatible, contrary to 
other trade partners, particularly the United 
States. Thus, France cannot picture reopening the 
domestic support part of the Common Agricultural 
Policy. 
 
¶7. (SBU) France does not believe that any 
agreement could be reached before the summer of 
¶2006. Both Lejeune and Alomar indicated that less 
developed countries are beginning to develop the 
point of view that a WTO trade deal will not 
benefit their economies while powers such as 
Brazil, Argentina and India will be the primary 
beneficiaries. To support this assertion, they 
cited recent studies by the World Bank. French 
agricultural leaders are closely observing the 
political situation in the United States, and many 
have expressed concerns that the upcoming mid-term 
US Congress elections and the end of the Fast 
track authority could jeopardize any trade 
agreement. They also question whether the 
political will exists to meaningfully reform the 
U.S. farm legislation. Finally, Lejeune and Alomar 
stressed that bilateral agreements may compliment 
but not replace a multilateral agreement. But 
should the WTO negotiations fail, then France will 
push for more bilateral agreements. 
 
BEGIN MEMORANDUM 
 
¶8. French Memorandum to the Commission 
 
The WTO Ministerial Conference in Hong Kong, at 
the initiative of Europe, considerably extended 
market access to rich and emerging country markets 
for products from the least developed countries 
LDCs). But it did not at that stage rebalance the 
negotiations in favor of EU interests. Thanks to 
the Commission's determination and the support of 
Member-States, the European Union managed 
nevertheless to obtain an acceptable result, 
unanimously approved by the General Council. 
However, in exchange for the substantial 
concessions the EU has made on agriculture, we are 
now entitled to expect our partners to come some 
way towards us. 
 
A precise timetable was laid down in Hong Kong for 
completing negotiations in 2006. Consequently, 
with a view to forthcoming events, we, the 
ministers who have signed this memorandum, wish to 
inform you of our expectations and concerns with 
respect to a number of negotiating points. 
 
¶A. The comparison between Non-Agricultural Market 
Access (NAMA) and agricultural market access must 
not disregard the concessions the EU has already 
made in other parts of the agriculture 
negotiations. 
 
Paragraph 24 of the Hong Kong Ministerial 
Declaration instructs negotiators to ensure that 
there is a "comparably high level of ambition in 
market access for Agriculture and NAMA." This 
paragraph naturally cannot affect the basic 
principle of the negotiation, which is that of the 
"single undertaking". The EU's other offensive 
issues must naturally be considered, particularly 
on services. 
 
However, it needs to be pointed out that any 
comparison between agriculture and NAMA is by its 
very nature biased: comparing only the two market 
access negotiations means ignoring the substantial 
concessions the EU has made on the other two 
pillars of the agriculture negotiations, domestic 
support and export competition. In addition, this 
comparison only makes sense if it addresses the 
actual additional market access opened up by 
negotiations. 
Furthermore, the liberalization of customs duties 
on industrial products began 50 years ago; 
agriculture cannot be required to "catch up" with 
50 years of industrial liberalization in a single 
round. For these reasons we are asking you to be 
particularly vigilant on this topic and to point 
out to our partners the concessions the EU has 
already made in reforming the CAP in 2003 and 
agreeing to eliminate its export subsidies. These 
concessions need to be taken properly into account 
when any comparison is made between the 
contributions put on the table by the various 
sides. 
 
¶A. On the export subsidy issue, the modalities for 
eliminating restitution payments are of crucial 
importance. 
 
At the Hong Kong Conference, the final Ministerial 
Declaration was unanimously adopted by the General 
Council. This was made possible by the guarantee 
the Member-States were given that the modalities 
for eliminating restitution payments would apply 
to restitution value ceilings. This is a key point 
to ensure that restitution payments are eliminated 
at a rate our farmers can cope with, in line with 
the CAP as reformed in 2003. 
 
We wish to stress the crucial importance we place 
on the political agreement reached at the General 
Council meeting in Hong Kong on 18 December and 
the negotiation of modalities for eliminating 
restitution payments in line with that agreement, 
which involves elimination occurring on the basis 
of value. If any substantial concession is due to 
be made in this area by the end of 2010, it must 
definitely involve an undertaking on value, 
expressed in overall terms. 
 
¶C. Parallel elimination must be obtained from our 
partners. 
 
In terms of "parallelism", a number of principles 
were approved in the July 2004 Framework Agreement 
and in Hong Kong. Now these principles need to be 
translated into binding practical disciplines, 
since the Hong Kong Declaration includes the 
possibility for the EU not to confirm the 2013 
date for eliminating restitution payments until 
the disciplines for parallel elimination are 
finally announced. 
 
This topic is all the more important since 
available economic studies show that if the EU 
were alone in dismantling its export subsidies, it 
would suffer considerable prejudice, while other 
WTO Members using other forms of export subsidy 
would gain an advantage from the EU's withdrawal 
from world markets. 
 
¶D. On market access and on domestic support, all 
room for maneuver is exhausted. 
 
The 28 October 2005 proposal exhausted - perhaps 
exceeded - all the room for maneuver we had. We 
then remain deeply concerned about the 
consequences this agriculture proposal may involve 
in Member-States, particularly for employment, 
when the Lisbon Agenda has made job creation a 
fundamental objective for the EU. 
 
On market access, we would especially draw your 
attention to the number and treatment of sensitive 
products contained in these proposals, which 
cannot under any circumstances be reduced. It is 
also necessary to strongly emphasize the need to 
maintain specific systems created in the Uruguay 
round like the Special Safeguard Clause and entry 
prices. 
 
On domestic support, the room for maneuver is 
exhausted on amber box. Moreover, we draw your 
attention to the fact that the review and 
clarification procedure, concerning the green box 
criteria will need to ensure that the basic 
concepts, principles and effectiveness of this box 
remain. Similarly, concerning the blue box 
criteria, any excessive "additional discipline" 
could undermine the future of the reformed CAP. We 
also note that the conditions accompanying this 
proposal have not been fulfilled. Although the 28 
October proposal offers substantial effective 
access to the European agricultural market, the EU 
has not received from the major emerging countries 
any proposal ensuring effective access to either 
their industrial or their service markets. If this 
continues with NAMA and services, the appropriate 
consequences will need to be drawn for 
agriculture. Conversely, if the conditionality 
contained in the 28 October proposal were to be 
fulfilled, this would mean a rebalancing of 
negotiations, and it would be unnecessary, indeed 
illogical, to respond with a further concession on 
agriculture; otherwise this would merely unbalance 
the negotiations again. In this connection, we 
have carefully noted the assurances you have given 
us that the simulation exercise currently underway 
in Geneva, where certain parameters would be an 
unacceptable negotiating result, is in no way 
binding for the European Union. 
 
¶F. Substantial progress must be made on issues of 
interest for the EU 
 
We recall the particular importance of the 
question of geographical indications for which the 
EU should get a concrete result. Furthermore, non- 
trade concerns have to be part of the final result 
of the negotiation. Substantial progress must be 
made on these issues, since it is crucially 
important that they advance at the same speed as 
the rest of the agriculture negotiations. 
 
END MEMORANDUM 
 
Stapleton