June 20, 2006

EU shows signs of ending beef and chicken trade war with US
 

An end is in sight for the long-standing trade war between the US and EU, according to European officials.

US exports of beef and poultry to the European Union have long been the casualties in this trade dispute which has lasted nearly two decades.

In the 1980s, the EU banned beef from the US and other countries that produce meat from cattle injected with artificial growth hormones. In retaliation, the US imposed about US$117 million of punitive duties a year on European goods such as Roquefort cheese, mustard, truffles and French hams.

Besides the US, other countries such as Canada, Australia and Mexico have also challenged the ban.

EU Trade Commissioner Peter Mandelson hinted that the beef hormone issue was one of two disputes that were close to resolution.

EU officials said the EU was also reconsidering its ban on US poultry treated by low-concentration chlorine washes for sterilisation as scientists now say it might be safe. However, he warned that discussions were still at an early stage.

Average US poultry export to the EU was about US$7.4 million a year between 2002 and 2004, a mere 2 percent of total EU poultry imports. Most of EU's poultry is supplied by Brazil.

The relaxation is seen as a result of the US pressing for more access to markets in the WTO's Doha Round. WTO countries are meeting this month to discuss trade issues in agriculture and industrial goods, two vital areas which may stagnate for years if no progress is made in this round of trade talks.