Transcript of Remarks by U.S. Secretary of Agriculture Mike Johanns Press Conference Hong Kong Convention and Exhibition Center, WTO Press Center, Theater 2
Monday, December 12, 2005
SECRETARY JOHANNS: Well, good afternoon, everyone. I'll go ahead and offer a few short comments to get this started, and then what I would like to do is open it up to any questions from the media.
With that, I am very pleased to announce that the Japanese market is now open to U.S. beef. Resuming beef trade with Japan is great news for American producers, and I also believe it is great news for Japanese consumers. As well, it's an important step toward normalized trade based upon scientifically sound, internationally recognized standards.
Reopening the Japanese market to U.S. beef has been a top priority for me, and I want to thank the many people and organizations who have been a part of this initiative. First and foremost, my thanks to our president, President Bush, for being personally and directly engaged in the effort.
I also want to thank my colleagues on the President's Cabinet: Secretaries Rice, Snow, Gutierrez and Ambassador Portman, as well as Ambassadors Baker and Schieffer for making the issue a centerpiece of their discussions.
I also extend my thanks to the chairmen of our Senate and House Ag Committees Goodlatte and Chambliss, and to the entire American meat industry, and all the USDA staff that have been involved in this effort.
Japan's action today sets an excellent example for other countries in Asia, whose markets still remain closed. Now is the time for Taiwan and South Korea, Hong Kong, Singapore and others to open their markets to U.S. beef. I urge all countries to take a science-based approach and adopt OIE standards for allowing beef trade.
Building bridges of understanding in collaboration between nations is an important part of ensuring food safety. American producers are very proud of a safe, high-quality beef product, and we greatly value the opportunity to promote the safety of our products to consumers in Japan and, for that matter, around the world. As I have said many times throughout the process, our goal is the resumption of normal beef trade throughout the world, and we will continue to work aggressively toward that goal.
Just some quick statistics under the agreement announced today: The United States is able to export beef from cattle 20 months of age and younger to Japan. More than 94% of total U.S. ruminant and ruminant products with a total value of $1.7 billion in 2003 are now eligible for export to Japan. Back in 2003, the United States exported $1.4 billion worth of beef and beef products to Japan.
With that, I'll wrap up my comments by offering my words of appreciation also to our friends in Japan for their diligent efforts. A very lengthy, thoughtful, careful, sometimes painstaking process has come to a conclusion, and we're very pleased about that. To my left is J.B. Penn, he's an Under Secretary with the Department (of Agriculture). As I said, we'd be happy to answer any questions that the media might have.
QUESTION: 21st Century Business Herald in China: We just heard from the Minister from Brazil this afternoon that he wants to set a deadline of 2010 for all the WTO members to cancel all the subsidies. Do you think it's possible for the U.S.?
SECRETARY JOHANNS: I think the reference to 2010 this morning was to one of the pillars in agriculture, which is export subsidies. And that has been the year that we've advocated for. Do I think it's possible that we would be prepared for that? Yes, I do. I think in terms of that pillar of the agricultural piece of this, that's a proposal that we have made, and we're comfortable that we could meet that proposal.
QUESTION: Reuters: How soon do you think it's going to be possible to start the U.S. exports to Japan for older cattle?
SECRETARY JOHANNS: That's a good question, and I must admit I don't know the answer to that. I wish I did. Before I arrived at the USDA, an agreement was reached that we would start with cattle 20 months and under, but we have continued to be engaged. And what we ask of Japan is to continue to engage in this discussion. Our focus is on compliance with the OIE standards, so we're going to continue that effort, but I must admit I don't have any idea what kind of timeline that would be.
QUESTION: Vietnam News Agency: Vietnam has completed talks with more than 20 countries, but has not yet completed talks with the United States for joining the WTO. Maybe next year we can be able to join it. What's the problem between the United States and Vietnam for talking about our country to join the WTO?
SECRETARY JOHANNS: I don't know that I can answer that. I always hate to do this, but that's an area where the Ambassador (USTR Portman) is working, and so I need to send you in his direction. I have not been a part of those discussions in any significant way, so he's the gentleman that really needs to answer that question for you.
QUESTION: Ian Swanson with Inside U.S. Trade: The offer to provide duty-free, quota-free access to all the LDCs -- where in agriculture might that be a problem for some groups in the U.S.? Do you anticipate any resistance from cotton growers or tobacco growers? And also, is this an issue for rice growers at all? Would there be some LDCs that would be able to export rice to the U.S.?
SECRETARY JOHANNS: Areas where we would pay attention at least, in terms of that issue, would be sugar, dairy, peanuts. At least on the ag side of the equation, that would be areas where I would pay attention. As the discussions continue in that area, my direction to our people at the USDA would be to try to make a determination as to what the implications are there.
We have not had a lot of discussion in the U.S. from our producers about this issue. I'm not sure what I would take away from that, whether it's something that maybe has not popped up on their radar screen in any significant degree. I have not had lots of calls at the USDA or anything like that. Today I can't tell you that there's opposition to the approach or approval one way or another. It just hasn't been a huge issue at this stage.
QUESTION: (Follow on) Is rice specifically not something that would be an (inaudible)?
SECRETARY JOHANNS: J.B. works in this area, so I might ask J.B. to offer a thought.
UNDER SECRETARY PENN: It's possible that rice could be, but I don't think there are many of the LDCs that produce rice that would be competitive in the U.S. market. They are more likely to be competitive in other Asian markets and not necessarily in our market.
SECRETARY JOHANNS: And keep in mind that my thoughts here relate to the ag sector. Beyond that, I'd send you back to Mr. Portman.
QUESTION: BBC News: Do you think it's likely that there can be a deal on cotton during this Hong Kong meeting, and is the U.S. prepared to make any further movement on that area?
SECRETARY JOHANNS: We have had an excellent working relationship with the C4 countries and Senegal; it's actually C5 as you know. I've now been to Africa a couple of times just since confirmation; and participated in AGOA. I accompanied the Ambassador on a recent trip to Burkina Faso, and our discussions have been excellent. We even took the time when we were there in Burkina Faso to look at a gin, a cotton gin, and visited with producers. And so the engagement has been very good and very positive.
That would lead me to some optimism that that engagement will hopefully lead to something that works. We're going to be meeting with C4 countries as this WTO week goes forward, and so I think the spirit is good. We feel very positive. Our private sector's been engaged. They've been working in terms of the cotton improvement program. I've just continued to be engaged about our working relationship there. They've been great to work with, and I hope they would say the same about us.
QUESTION: Congress Daily: I have two questions. The first one is about beef. There have been rather mixed reports about the Japanese reaction to U.S. beef coming back. Some reports saying that they missed it, and people are enthusiastic about it. Other polls show the Japanese consumers aren't enthusiastic about U.S. beef coming back. From the standpoint of American farmers, how should they view this situation and what kind of efforts are going to be necessary in order to try to convince the Japanese to buy U.S. beef again? That's my first question.
If I could be allowed a second one on a very different subject. This is Africa. Earlier today at a cotton day event, Karan Bhatia, the U.S. Deputy Trade Representative, criticized the European Union for not allowing a high value-added product in from Africa. And he specifically used the example of cocoa, saying it had one tariff at the basic level, and another at the semi-processed level, and a very high, 30%, at the final confection stage. I wondered, what is the U.S. position on tariffs on high value-added products, on allowing them back in? I know we've proposed cutting tariffs, but do we view that differently than basic commodities?
SECRETARY JOHANNS: Probably the more extensive answer is going to come from the Ambassador again, because he works the whole trade area, and I tend to focus so specifically on the agriculture area.
If I might just offer a general thought. In terms of our efforts to work on the cotton issue, for example, with the C4 countries, we take that very, very seriously. The demonstration of our time and our effort -- we've been working with these countries very diligently. So I just want to emphasize, to us this is a very serious endeavor.
But I have to tell you in my discussion with countries around the world, including African countries, I still firmly believe what is really going to make the difference long-term is to remove the distortion from agricultural trade. Whether it's subsidies that wealthy nations can pay that poor nations cannot; whether it's high tariffs. There's a lot of ways, as you know, to protect agriculture. You've covered agriculture a long time.
If I were to offer any thoughts, it would be that we need to keep our eye on the bigger picture here. And the bigger picture really is the notion that we've got to eliminate distortion from agricultural trade, whether it's subsidies or high tariffs or whatever other barriers are out there. And that, over time, is what really is going to make a difference to the least developed countries, the developing countries, and it's really going to make a difference to the world economy.
In terms of your question about the beef and what efforts, well, first and foremost from the USDA standpoint, there's now in place a beef expert verification program. We need to make sure that we comply with the requirements set forth by the Japanese for entry of beef into their country. And so we are going to continue to stay engaged. I think there's a team literally leaving from Japan today, and we welcome that. We welcome that working relationship and that effort, and I think that will be viewed very positively.
Then the second piece of it is joint USDA, but also industry. And there's been so much discussion, so much reporting on this issue, some of which has not been entirely scientifically accurate. I think we just really need to reach out and work with the consumer in Japan. We are very optimistic that the consumer will respond favorably to our beef. We have indications that that's going to occur. But we don't assume that. We make the assumption that we're going to have to work with and reach out to the Japanese consumer. But we believe we can do so successfully, we believe very strongly we've got a very safe product in beef, and a very good product.
QUESTION: Secretary, during your press conference with Ambassador Portman on Friday, you expressed some optimism that there could still be some relative progress made with the EU on several different areas. Have you received any signals since then on, for example, a reduction in sensitive products or any other areas where you see on the eve of the Ministerial that there's going to be some additional movement out of the EU?
SECRETARY JOHANNS: I honestly wish I could answer that question yes, yes, absolutely yes, but I can't. We have not received an indication since that press conference of additional movement, and I have not talked to either Mr. Mandelson or Mariann Fischer Boel since I've been here. I'm sure we'll run into each other at some point, but we have not yet. I did read some press reports that M.r Mandelson indicated there would be no further offer made -- and I hope I'm quoting him correctly -- but my impression is that he does not intend to table a new offer here in Hong Kong. We're not going to give up, though. We're absolutely dedicated to this round. We believe it can be a successful round, and we believe that this can be a successful Hong Kong Ministerial. We have a real desire, a passion, to make sure that this round is successful, and we're very, very committed to it. My attitude is, following Hong Kong, we redouble our efforts. We do everything we can to bring this to a successful conclusion.
QUESTION: In the light of what you just said, then how do you define progress in Hong Kong?
SECRETARY JOHANNS: I think the Ambassador spoke to that this morning in terms of what we hope to accomplish here. I will tell you how I define progress overall -- and for that matter it would apply to what I hope we accomplish here in Hong Kong -- which is a step along the way. We're not going to have a final result in terms of what I'm going to tell you, but it's as I said to Jerry, this really needs to be about wringing out of the agricultural trade system distortion. That distortion exists in a lot of ways. It could be subsidies, it could be high tariffs, it could be whatever market barriers are out there. If Hong Kong can lead us a step closer to that effort, then that's a positive initiative, whether that's setting a date on export competition or whatever it is. So, you know, I wish I could tell you that at the end of the week there are fifteen things that need to be done. There are probably fifty things that need to be done. But my goal ultimately is to stick with this and do everything we can to reform agriculture worldwide. I feel very strongly that's what's going to open the world economy.
QUESTION: Just regarding U.S. beef into Japan and vice versa, you mentioned earlier that you foreshadowed an announcement that the U.S. would be lifting restrictions on Japanese beef into the U.S. following a risk assessment process. Just wondering, how much of a coincidence is the timing of the two announcements, given that there'd be cynics out there who would say that such timing would indicate there are factors other than pure science and risk assessments at play?
SECRETARY JOHANNS: Each country has to go through its own risk-based process. Japan had a process that they went through, and on a number of occasions in visiting with the Japanese Minister, I was walked through this process step-by-step. There was just so much they had to do.
We have a different process, but really much the same approach. It's scientific-based, its risk analysis, it's all of the things that are necessary to get to a final result. I will have to tell you, it just occurred logical to me that we had to be working on our process. We were making demands of Japan. It was just scientifically logical that we respond on a scientific basis to their request for the return of Japanese beef to the marketplace. As I indicated weeks ago, it was my intention to do everything I could to be ready to act when we were done with that process, and hopefully at a time when Japan was ready to return beef to our marketplace. I will tell you even as recently as last week it was possible for either process to go in a different direction. But I'm very pleased today that I can tell you that not only has Japan opened up its marketplace to beef, but we will announce that later on -- actually first thing this morning in about three hours, 8:00 am Eastern time. So it's not so much coincidence as just the reality that, look, I was asking them to do something, and if I were asking them to do something, then I had to live by it in my role as Secretary of Agriculture. That's what we did with the Wagyu beef.
Maybe one or two more questions.
QUESTION: How much improvement on market access would you consider progress here?
SECRETARY JOHANNS: We have our proposal out, which is very, very specific. There are a number of proposals out there, but the G20 also has a proposal out. We have signaled already publicly and privately some weeks ago that when it comes to market access, negotiations should occur between those proposals. Now there are some parts to that G20 proposal that we strongly feel you have to negotiate in terms of developing countries. Again, we've talked about those things, but if I were to outline the parameters for the market access proposal, the parameters I would outline would be somewhere between G20 and the United States proposal as the point of negotiation. The closer we get to the U.S. proposal, the better we're going to feel about it, but those are the parameters. I verbalized that and the Ambassador has, also.
We can give you the detail on the specific elements of market access, but the principle's the same. The highest tariff should be cut the most. On the last day, to get to your question, I think what market access really comes down to is that when this deal is signed, sealed and delivered, countries can start seeing products moving into markets that otherwise had barriers, high tariffs. That really is going to be the ultimate judge of whether we've accomplished market access.
OK, I'll take the last question right over here.
QUESTION: I wondered how you think that the U.S. domestic support influences the world market prices and world trade on the commodities that stem from producers that have received domestic support. Thank you.
SECRETARY JOHANNS: There are many programs in the United States, as there are in other countries, relative to the impact. I can reference studies. If you go to cotton, the parameters seem to be somewhere between about 2.4% and 12 ½ %. That's what the studies claim, at least.
Here's what I would offer to you, again just as a very general proposition. Our President has set a goal that basically says we need to eliminate trade-distorting subsidies worldwide. I believe that is the correct approach and the right goal, and that's what we should be attuned to. That should be the approach we are taking.
But what that means is that markets have to open, and what that means is that subsidy regimes or approaches have to be changed. We have a very ambitious proposal out there in terms of how that should happen. I don't think anybody at this date is challenging the ambition of that proposal. In fact, it goes beyond the July framework, and I think it surprised people. Having said that, it has met with nearly universal approval. Now, I'm wise to acknowledge that if you went to Brazil, they'd say we'd like to see the U.S. do a little bit better here and a little bit better there, and other countries would make those statements. But believe me, it was a very, very aggressive, bold proposal.
Now if we can get others to match that, if we could get the European Union to match our ambition, I believe we are well on our way to making a real difference in terms of the world economy, not just for developed countries but for developing and least developed.