On February 24th in his first formal address to the two chambers of Congress, the American President Barack Obama, in the context of the 2010 budget, announced his intention to “put an end to direct payments to large agribusinesses that don’t need them”. This decision which is part of a series of political decisions aimed at capping the budget deficit, would consist in halving the 5,2 billion dollar amount granted independently from the type of production or price level, and which today essentially favours rice and cotton producers in the southern states. This way, the budget project should allows savings of 143 million dollars starting in 2010, then 504 million in 2011 and more than 1,2 billion each year between 2013 and 2019, representing, this ought to be mentioned, a very weak share of the total financing allotted in the context of the Food, Conservation and Energy Act 2008.
A calendar coincidence? The day before, the Director-General of the World Trade Organisation (WTO) Pascal Lamy pointed out in Seoul the supposed benefits of the Doha Round which, according to him, ought to reduce the amount of subsidies granted by the rich countries to their own agriculture by 70 to 80%. Given the fact that the issue of subsidies is one of the questionable points of the Round, some analysts such as the Canadian Minister of Agriculture Gerry Ritz do not hesitate to see in this American measure a “good step forwards” in the direction of the Doha Round.
Behind these symbolic measures and these oral gesticulations we can see the very intoxicating approach desired and promoted by Pascal Lamy. Indeed, today it seems clear that it isn’t by reducing subsidies in the rich countries that, through some sort of miracle, the poor countries’ agriculture will recover. On the contrary, deregulation will bring these countries to grips with stronger international competition, thereby destroying agricultural sectors which are already suffering from chronic under-investment. As for American credit limitations this is but a cosmetic measure, given the small amounts concerned, aimed at pleasing not only those who worry about the US deficit but also the media who always tend to point out the rich countries’ egoism in the context of the Doha Round.