The U.S. WTO Agriculture Initiative

        MR. JOHNSON: First of all, good morning to everyone, and thank you for coming. Let me just start off with a statement that gives you an idea of what we're proposing here.

       As you know, the president, Ambassador Zoellick and Secretary Veneman have been in the forefront of our agricultural trade agenda, and in fact the agricultural trade agenda for moving forward in the WTO. And now is a very critical moment from our point of view in that process.

       This proposal is about opening markets and expanding markets by creating opportunities for U.S. agriculture in a growing fair global marketplace. Frankly, you cannot picture and paint a bright future for U.S. agriculture or for global agriculture without trade. This is the first time since the creation of the WTO that we've had a comprehensive proposal very specifically addressing all the trade- distorting practices in the world. And the question you might ask is, "Why now?"

       Well, we had two successes in Doha. One was, is that we had very ambitious objectives, and you'll recall substantial improvements in market access, reductions with a view towards phasing out export subsidies, and substantial reductions in trade-distorting domestic support.

       Secondly, we had a success in having a very specific schedule. You might recall the Uruguay Round took eight years. Well, we said in Doha we want these negotiations completed in three years, by January 1, 2005.

       And in agriculture, we went even farther; we said we want to conclude the modalities by March of 2003. And what the modalities are are really the guts of the negotiation. They're what determines how fast and far to reduce.

       This proposal supports both of those successes and moves the process forward. The proposal's comprehensive because you cannot address any of the three pillars alone. The proposal's ambitious because we must see significant progress in leveling of the field in all areas if we're going to see progress in any of the areas. And the reason the U.S. is leading in this discussion is because we must, as we have we have in the past, in Doha in June of 2000, when the U.S. put forward a comprehensive framework for the negotiations and as we did last month in export competition.

       Let me just back up a little bit to review what happened in the Uruguay Round. The Uruguay Round captured agriculture for the first time in global negotiation. And in order to do that, we had to strike a compromise. And what that compromise was, was that we put a cap on the way -- the level that support was at that point, and then we agreed to reduce it by a little bit -- by a straight percentage amount. But while that was significant, it left tremendous market- distorting practices in place and also significant disparities between countries. These Doha negotiations are about simplifying the rules and leveling the playing field. Then we need to move forward to the next phase, which is the eventual elimination of all tariffs and trade-distorting practices.

       Let me first review what we did last month in the first part of this proposal on export competition. Let me draw your attention to this chart. (Laughs.) As you can see from this chart, Europe basically has about 90 percent of the export subsidies in the world. But our objective, pure and simple, is to eliminate, which is the right side of the chart here -- you'll see nothing, because our proposal is to eliminate all export subsidies in five years.

       In addition to to that, last month we proposed that we eliminate the monopoly controls and special privileges that export state trading enterprises enjoy. An example of that is -- would be the Canadian Wheat Board. We want to eliminate the trade-distorting effect of export taxes. WE want to strengthen the disciplines of all countries and all practices as it relates to export credit programs, which is very important because, as we see this move towards zero, we want to make sure there's not a way of circumventing that obligation through other programs.

       And finally, on food aid, we proposed expanding reporting requirements, to increase transparency and strengthen market displacement analysis in the international organizations charged with reviewing food aid activity.

       Good morning, Al. (Chuckles.)

       In market access, which is the next chart, you'll see that the global tariffs today average about -- are allowed -- are about 62 percent. The U.S. is around 12 percent. We want to reduce all tariffs, both out-of-quota and tariff-only systems, using a Swiss formula approach that cuts high tariffs faster than low tariffs, and with no tariff greater than 25 percent. As I said, the average global tariff would go from -- allowed would go from 62 percent to 15 percent under our proposal, while ours would go from 12 percent down to 5.

       We want to eliminate all in-quota -- tariffs in quota on tariff rate quotas; want to expand TRQ quantities by 20 percent, which we want to be available to all countries, not based on what the historical pattern has been, which we think would be particularly helpful to developing countries; want to strengthen the disciplines on TRQ administration, to make sure that they are -- the quotas are filled and that there's greater transparency, so that farmers around the world can benefit from the access that TRQs are supposed to provide; want to eliminate the monopoly import control of state trading enterprises -- in other words, allow any interested party who wants to import to do that -- want to -- we want to eliminate the special safeguard, because we believe that that's out of date. That was something that was put in during the Uruguay Round for the tariffication process. The Uruguay Round started to implemented on January 1, 1995, so that's seven years ago.

       We do think we probably -- we need a discussion about import relief mechanisms as it relates to seasonal and perishable commodities.

       And finally, we want to promote sectorial initiatives, because our approach to liberalization is that all these tariffs and distorting practices should come down, come down significantly and should be leveled, and then move on to elimination.

       But there's some sectors that want to move faster and want to move more broadly. We want to encourage that. So once we get this significant leveling in all areas, if certain sectors want to move forward, we want to work with them to make that happen.

       And then, as I said, we want to agree to a specific date for the elimination of these market access barriers.

       And finally, on domestic support, we want to simplify the rules in domestic support by creating basically two boxes: one that's trade-distorting, one that's not trade-distorting.

       Now, this chart shows you here that Europe -- this depends on the currency fluctuations, but basically Europe is at $67 billion today. But this is just amber box support that they're allowed. In addition to that, they spend another 20-plus-billion in blue box support, both of which, by definition, are trade distorting. What we want to do is combine the amber and the blue box into one box, call it "trade- distorting support," and we want to discipline that by allowing ceilings at no higher than 5 percent of the total value of agricultural production. And again, it makes logical sense that the amount of support you provide for agriculture is relative to the size of your agricultural economy.

       We want to maintain the de minimis provisions that exist currently -- as they exist currently. And we think it's extremely important to maintain the green box, which are non-trade distorting supports, as a way of encouraging movement from trade distorting to non-trade distorting and allow for conservation, environment, extension type of programs that many countries use. And again, we want to promote sectoral initiatives, what I call "WTO Plus," for those sectors that want to move beyond this.

       And finally, agreed again for a specific date for the elimination of trade-distorting domestic support.

       As I said earlier, this proposal will get the job done by addressing all the unfair trade practices in the world in a comprehensive way. We are confident our farmers can compete in this environment, but we're also confident that farmers around the world will benefit from such a proposal. This negotiation is about new rules and new directions. While the Uruguay Round was a good first step, that approach isn't good enough for what we now must take as the second step. And it's time to move forward broadly with proposals that create opportunities for farmers around the world by growing markets, lowering barriers, and eliminating distortion.

       So we had mentioned earlier that I'd answer questions at this point, but Ambassador Larson has just showed up, so I guess I'll turn the mike over to him and let him go, and then we'll answer a few questions.

       Thank you.

       MR. LARSON: It's a real pleasure to be here with my colleague and fellow Iowan, Al Johnson, to talk about a subject that we're both passionately interested in.

       I just want to underscore a few overarching points. This is an extraordinarily important initiative that Ambassador Zoellick and Ambassador Johnson announced yesterday. It's important in the trade world because anyone who was at Doha realized that the agricultural mandate at Doha was one of the most important accomplishments of that meeting. It was something that, in particular, the developing countries felt very, very strongly about.

       Here is an area where the developing countries have a potential to compete. And the proposal that Ambassador Johnson just outlined is a very forward-looking proposal for leveling down these trade-distorting practices and then, in a second phase, moving to eliminate them.

       It's also a very important proposal in the development world. We have had a series of development-oriented conferences this year, the Monterrey conference on the financing of development, the Rome food summit, and there will be the world summit on sustainable development. And one of the most important messages coming out of those development conferences is that trade can be the most important engine to growth and development. And again, that for developing countries, that agricultural trade is an extraordinarily powerful tool for generating growth and alleviating poverty in many developing countries. And we believe that the proposal that Al Johnson just outlined is very responsive to those concerns. As Ambassador Zoellick said yesterday, we are listening to the developing countries and we're coming up with a proposal that is very responsive to both the trade agenda, the development agenda.

       We would very strongly encourage developing countries that have been pushing for progress in this area to join with us in Geneva and in the WTO to get movement and to really make this proposal a reality because it would be a revolutionary change in agricultural trade and create very, very important opportunities for developing countries. And we would encourage our trading partners, particular those that have large levels of trade distortion, market-access barriers or subsidies, to join with us and to move this agenda forward. If they've got a better idea, well, we'd be happy to hear it. But I think we've reached the stage in this debate where it's time for action and proposals, it's not time for talk. The United States has put forward a proposal and we're looking forward to working with other countries to advance that proposal in the WTO.

       MODERATOR: Undersecretary Larson and Ambassador John will be glad to take your questions now. Just to remind you once again to please introduce yourself and your news organization.

       So, the gentleman here in the front.

       Q My name is Adu-Asare, a reporter for AfricaNewscast.com. I see what I consider to be a contradiction here.

       From Doha -- Doha was before Monterrey. And Monterrey was before the Farm Bill. And the Farm Bill is for 10 years, and the new proposal is for the -- if the proposal is going to be accepted, that means that the export assistance is going to come down after five years. Now, which of the two will supersede? Is it the Farm Bill or the new proposal?

       MR. LARSON: Go ahead.

       MR. JOHNSON: Actually, I'm glad you asked the question because I think there's a number of -- I can understand your confusion because there's a number of misperceptions there.

       First of all, the Farm Bill is six years, not 10 years. And so, what the proposal is basically, is we look at this domestic support, so you're -- (inaudible). As we look at this, what we're trying to do is we're trying to move down the trade-distorting domestic support quickly. You're absolutely right. The negotiations here are about the future. And the Farm Bill is about the current rules. And I won't bore you with -- in fact, I think I've expressed to you or people in the organization as to what our views are on the Farm Bill and why we believe it's consistent with the current obligation.

        What we're trying to do here is outline a vision for the future. Because these negotiations are about the next rules. And what we are saying at this point is that this kind of disparity shouldn't be allowed under the new rules. It shouldn't be allowed whether you're talking about domestic support, it shouldn't be allowed whether you're talking about market access, and it shouldn't be allowed if you're talking about export subsidies. We need to level this field, and we need to eventually eliminate these distorting practices.

       So, there's not an inconsistency between the two. The Farm Bill is the current rules, but we don't like the current rules, frankly. We want to move forward, and that's why we put forward a very specific proposal. And so far, we're the only ones that have done that in a comprehensive way.

       Q Can I have a follow-up, please? For most of the African trade officials, they find it difficult to see the difference between what you consider to be the domestic assistance and the export assistance. As far as they are concerned, they put all in the same bucket. And it becomes a chunk.

       MR. JOHNSON: No, and I understand the sensitivity to both, which is why our proposal challenges both.

       But just to help clarify, the main difference is domestic support says -- basically trade-distorting domestic support usually encourages the production of something. What export subsidies say is that in addition to that, we're going to pay people to buy it. And what we're saying in this proposal is that -- which is particularly troubling to the African countries and the developing world because obviously they don't have the funds to be paying their customers to buy their product.

       We're saying is -- those practices should be eliminated and -- as well as to trade-distorting domestic support needs to be reduced dramatically, and then eventually we need to work towards elimination of that as well. So I think, from an African country's point of view, that's very important.

       And in the market access area, we had -- one of my staff just gave to me, as I was walking out the door, which I know Al is probably very familiar with, which is -- the World Bank had done a study on full liberalization agriculture and said that developing countries' income would increase by $539 billion. Most of that, 80 percent -- through liberalization. Most of that, 80 percent, came from other developing countries. So the market access barriers we also share a common objective with.

       MR. LARSON: If I could just, Al, add one quick point on this, certainly all of the African trade and agriculture ministers that we've talked to -- you know, if they were told, "You've got a choice between two worlds; you can have this world or you can have this world," they would clearly choose that.

       Secondly, if you had a choice between the current level of export subsidies, in the European Union in particular, which I'm sure is another chart, do you want this world or do you want this world? I also think it's a pretty clear choice.

       And so I'm very confident that we will have a lot of support from African agriculture and trade ministers for the proposal that Ambassador Johnson outlined.

       Q My name is Andrei -- (off mike).

       MODERATOR: (Off mike.)

       Q Yeah, it does. It does.

       MODERATOR: Oh, yeah. There we go.

       Q My name is Andrei Sitov. I'm with the Russian news agency Tass here. And Russia obviously is not a member of the WTO yet, but we are negotiating. The most optimistic scenario has Russian joining in the next year, 2003. You said that the modalities should be in place by spring 2003. Does that mean that Russia has no way, even theoretical way, of influencing the outcome of the negotiations?

       And second of all, the Russians are also talking about maybe having some sort of a transition period for their agriculture. They say that they will definitely have to accept the rules of the WTO when they join, but that maybe those rules should be applied not all at once but maybe in a few years -- phased in, so to speak. Would that be negotiable?

       MR. JOHNSON: You want to try that, or you want me to -- okay.

       First of all, by definition, the negotiations are such that the WTO members are the ones -- going to be the ones deciding the rules. And what the issue -- you actually reminded me of something -- the March 2003 date. One of the reasons it's so important that we move forward with this specific proposal now is we want to make -- we've got nine months to get this done.

       And so, I think it's safe to say that the current members of the WTO are the ones that are going to be negotiating what the final modalities are. Of course we're always happy to hear anyone's ideas. And in terms of the accession process, I think there's going to be -- you know, there's a lot of work to be done in order to make that happen.

       Q But why did you set that nine-month deadline for yourselves?

       MR. JOHNSON: Well, because the Uruguay Round went on for eight years. And basically, what we said -- we said two things in Doha, as I said, two important messages. One was that the Doha approach -- or the Uruguay Round approach wasn't good enough. We redefined the objectives that I said earlier. The second thing that we said is that the time line it took us to get there isn't good enough; we need this done in three years. Now, agriculture is a very difficult subject, as you know. And so what we've tried to do is say well, if we're going to meet the -- if agriculture is going to meet the time line, we've got to set milestones along the way. And the first milestone is to achieve by March 2003 the modalities.

       Q I have questions for both of you. Ambassador Johnson, first --

       MODERATOR: (Off mike.)

       Q Oh, Wei Jiang (ph) from Phoenix TV of Hong Kong. I have questions on China. One of your charts said, the market-access chart, that's about agriculture only or just all market --

       MR. JOHNSON: Agriculture.

       Q Agriculture only? Okay.

       My question for Mr. Johnson is, would you comment on the TP -- the trade promotion authority that the House might pass today, what that will help for you to negotiate the trade agenda.

       MR. JOHNSON: I'm sure that Ambassador Larson has some thoughts on this one too. But my thought is simple, which is, these negotiations are happening, as this proves; they're moving forward. And we need trade promotion authority, we need it now in order to negotiate from a position of strength and to make sure the messages like this, that are good for U.S. agriculture and good for global agriculture, are able to get through because the U.S. is in a position of leadership. And TPA shows the world that the Congress of the United States are united in pursuing these kinds of objectives.

       Q Could I ask Ambassador Larson, sorry, I don't know the specifics about Agriculture secretary's visit to China and Japan. Would you brief us again on that? And also, the Chinese government seems not very happy about the farm bill, and would you comment on that and if there's any other agriculture disputes with China.

       MR. JOHNSON: You get the easy ones!

       MR. LARSON: Yeah! (Laughter.)

       I don't have the details of Secretary Veneman's schedule.

       My understanding is that in Japan, she will have an opportunity to meet with other developed-country agriculture ministers. And so it will be an opportunity for her to have the same sort of discussion that we're having here about the U.S. proposal and I think building better understanding and more support for the proposal.

       I know that when the secretary was in Rome for the World Food Summit, she had a very good meeting with the vice premier that oversees agricultural issues, and it was at that time that the idea of a visit to China came up. And so we're very pleased to have an opportunity to engage with China on a range of agricultural issues.

       I think that I'm not going to accept your invitation to go into the -- (chuckles) -- list of all of the issues that need to be discussed. I think the one issue I will mention is the important shared interest that China and the United States have in the area of agricultural biotechnology. We have some issues to work out with respect to the trade regime as it affects some of our products going into China, particularly soybeans. And that's something that's very important to us, and we want to make sure that that gets worked out in a way that ensures that the trade flows.

       I think, at the same time, there's a compelling interest that China has in making sure that agricultural biotechnology is treated fairly in the world trading system. And China is a country that is using agricultural biotechnology extensively. I think some 20 percent of their cotton crops is BT cotton now.

       And one of the things that we heard in Rome that was just an absolutely fascinating story was how much safer this product was for Chinese farmers than the products they had used before. There were actually charts that a Chinese scientist showed us about how fewer farmers were getting sick and even dying of pesticide overexposure because with the new product, they didn't need to make 20 applications of pesticide over the course of the year.

       So I highlight the biotechnology point because I think it's an area of shared interest between China and the United States, even though we do have a very specific issue right now, in the case of soybeans, that has to be worked out.

       MODERATOR: Ambassador Johnson has to leave first, so if your question's for Ambassador Johnson -- okay.

       One more.

       Q Yes. Hi. Paulo Barcelev (ph) with Reuters. I'd like to know if you have contacted Latin American -- your counterpart in Latin America.

       They're -- particularly Brazil and Argentina are very keen on moving ahead to lower tariffs and export subsidies. What kind of reaction you're getting from those countries and other Latin American countries within the framework, possibly, of TPA?

       And also, if you could clear up, I know Latin Americans might feel that the average issue here -- that you're bringing down average subsidies, but that you may have very high specific product subsidies, say on orange juice from Brazil. So if you could comment on that, too.

       MR. JOHNSON: Well, on the first half of your question -- we're in the process -- I know that Ambassador Deily in Geneva has been talking to her counterparts. We're contacting the other capitals, making them aware of it. I take off to Geneva on Saturday, so I'll be meeting with my counterparts over the weekend and into next week. So I'll be able to -- in fact, I think we'll end up doing a press event over there, so your counterparts can ask me that question once I get a first-hand response. So I'm hesitant to categorize other people's opinion of our proposal, except to say that this is the direction that we all agreed we wanted to go in Doha. And so I think that generally, folks should be very, very happy with what we're trying to do here in moving the agenda forward.

       In terms of specific support, there's -- you mixed two different issues, so I'll answer both of them. One is market access barriers and specific -- basically the question that you're asking: What does this do to a specific commodity across the board? And my answer to that is export subsidies is pretty specific, which is zero. So that means no -- product specific, on every product, no export subsidy. That's something that we think Latin America will like, and others in the developing world should like.

       On market access, lowering those barriers, as you see, it's a dramatic drop in the average bound tariff, allowed tariff, under our proposal. And in fact, it's even farther than that because our approach is doing it from applied rates and these charts are based on bound rates. So we think it will have an even more dramatic effect on them. So product specific -- and those are tariff -- (word inaudible) -- so that's pretty product specific in lowering those barriers across the board.

       And in domestic support, domestic support isn't necessarily product specific, but if -- (to staff) -- Jason, if you'd throw back that one. (Referring to charts.)

       The observation that really needs to be made is that if you take these -- take out -- what basically our proposal does is take out $100 billion in allowed domestic support, trade-distorting domestic support, from the system. You take that out, the ability to influence any one commodity changes dramatically. And if you do focus on one or two commodities, it means your impact on all the rest is non-existent.

       So, we think this is a very, very positive proposal across the board for everyone that's concerned. And so, we're pretty confident that as we move through this process and people understand better what we're proposing, that we'll have a very affirmative response.

       Q One more, please?

       MR. JOHNSON: Okay. I'll take one more.

       Q (Off mike) -- from Australia Broadcasting. In light of the hastened progress of TPA through Congress as we understand it this morning, and my country's interest in a bilateral trade -- in bilateral trade talks with the United States, how much will the pace of pick up of your proposal here in the WTO, and negotiations more broadly, affect the timetable for bilateral trade talks, both start -- when you'd expect those talks to start and when you'd hope they might finish?

       MR. JOHNSON: I'll make a run at it, and Ambassador Larson may want -- the timetable here was established in Doha. And so, what we're doing is keeping up with that timetable and not running ahead of it. And in fact, we think this is why we're getting down to specific, comprehensive proposals, because we think everyone should be moving that ball forward, with nine short months before we're supposed to agree on modality.

       I think in the sense of -- as Ambassador Zoellick has said repeatedly, we're trying to create a competition for liberalization. So, we're going to keep moving forward on all fronts. I'm not going to comment on specific FTA or another, but we're going to move forward on all fronts, globally, regionally and bilaterally. We see those as not being mutually exclusive, but mutually complementary.

       And I should say within the agriculture community, as we've seen, there's been a lot of support from the U.S. agriculture community for this proposal. They see the WTO, and I think frankly even Australia would agree with this point, which is we see the WTO as the best vehicle, the best environment, for accomplishing our mutual objectives on agricultural trade reform globally, which is why we've worked so hard with Australia and the Cairns Group prior to Doha and why we continue to work hard with them as we move through the negotiation.

       Q Thank you very much.

       MR. JOHNSON: Thank you very much.

       MR. LARSON: You can stay -- thanks a lot. You want to leave your chart?

       Q Yes, hello. (Name inaudible), from the BBC. I just have a query. You say, trade-distorting, you know, subsidies. You use that adjective. That means you have some other subsidies that will keep going without any limit? And who's going to decide what is a trade- distorting subsidy? I mean, you are the one who's going to decide it, or you're going to negotiate that? And how the developing countries will kind of believe you on that when, you know, you have this Farm Bill, for example? I mean, is really -- the message you're giving is one thing and you're doing something else.

       MR. LARSON: Well, no, I think that's totally wrong. But, first of all, the definition of trade-distorting subsidy is something that has been an international definition.

       The president has proposed a significant increase in our development- assistance budget for promoting agricultural productivity in these countries. There are several dimensions to this. Some of it involves increasing the access of African farmers to some of the more modern technologies so that they can use those to increase their productivity. Some of the most promising projects we have are -- like a project in Mali, where we're simply helping farmers get better information through radios about the prices of agricultural products in different markets so they can do there what farmers here do -- look at two or three different options about where to take their products and then go to the market that has the best prices for them.

       We are very active in this. We are proposing at least a 25- percent increase in the budget -- our development-assistance budget for agriculture. And we're encouraging the multilateral development banks, also, to increase their investment in agriculture.

       Q Takeshi Malaki (ph) (for the Asahi ?) Shimbun. What do you think of the high tariffs on Japanese rice? There is a backlash in Japan with your proposal. Even the fact that you passed the farm bill -- Japanese people say your policy is a little bit hypocritical. Do you think Japan would agree with your proposal to reduce all the tariff less than 25 percent?

       MR. JOHNSON: Well, I mean -- again, I think anyone that would wish to criticize our proposal should be challenged to come up with an alternative that would be better in terms of fair trade in the agricultural system and would be better in terms of being fair to the developing countries. As I'm sure was explained to you earlier, Japan has a very high level of trade-distorting subsidy allowance in the WTO now. And so it would be puzzling to hear that Japan was rally taking issue with the farm bill which will keep us within our much lower level of trade-distorting subsidies. So I don't think there is any basis for the United States' present posture under the farm bill to be criticized by the European Union or Japan, which have higher domestic- subsidy allowances than we do.

       But more important than that is, we are not engaged in a beauty contest. We're not saying just because we're here and Japan and the EU are higher, that let's stick with the way things are.

       We're saying let's move in the direction of dramatically reduced domestic trade-distorting subsidies, so that there is a more level playing field for international trade and so that developing-country farmers have a better opportunity to compete.

       I think that's an approach that I would hope the government of Japan would support. If they have -- if any of our trading partners have a better idea that would be even fairer in terms of agricultural trade or be even fairer to developing countries, then we'd be happy to hear it.

       MODERATOR: (Off mike.)

       Q Sorry. AfricaNewscast. I have a short question. Have you heard anything from the Europeans in the past 24 hours with respect to the new proposals?

       MR. LARSON: I've seen some things in the press. I think, as Ambassador Johnson was saying, we'll have an opportunity for more detailed discussions in the very near future, and it's probably best to wait for a reaction after there's been greater study and greater analysis of what we've done. But you've probably seen the same press reports that I have.

       Q Mr. Johnson, Nadia Tsao with the Liberty Times. From the chart, it seems like EU and Japan are the main targets that this new proposal, you know, is going to -- dealing with. And we know that protection of the agriculture in this area's pretty strong, and they are important allies of the U.S. So far -- just wondering -- before you announce this proposal, what's their, you know, preliminary response? Thank you.

       MR. LARSON: Well, again, I don't know -- I think we will need to see what the studied reaction is of our partners. Secretary Veneman is in Japan. She's having these conversations with our major trading partners. Ambassador Johnson just announced to you that he's going to Europe for further conversations. So I think we should see what the reactions are.

       My point today is that this is a proposal that is very responsive to the calls that we have heard from developing countries for movement on agricultural subsidies and on market-access barriers, that would create a more level playing field for all of the world's farmers, but in particular for the farmers in developing countries.

       We think it's the sort of proposal that developing countries will wish to rally around. We certainly urge all of us who are concerned about agricultural trade to rally around these proposals. And we would ask anyone who's inclined to be critical to first subject themselves to the basic rule that if you want to criticize something, let's say first what better idea you have. I'd like to see some proposals coming forward from any of the trading partners who think they have a better idea than this one.

       Q Thank you. I'm from China, with Xinhua?? News Agency. Would you please tell me whether you want to (pass ?) any positive information -- message to Chinese readers? And do you think whether you can have any constructive and positive cooperation with China? Thank you.

       MR. LARSON: I think the answer is certainly yes, both in the general sense that we consider China to be a very important member of the trading system, but also in this area of agricultural trade. As I said a little bit earlier, one of the many areas of common interest that we have with China is our interest in the contribution that new agricultural technologies, including biotechnology, can play in helping meet the food needs of the world in a way that's environmentally more sustainable than present practices, can be safer and more friendly to farmers that use these technologies, and increasingly can bring improved nutritional characteristics to consumers.

       So I just highlight that as one of, I think, a number of areas where we have some common interests with China, and that's one of the reasons why the secretary of Agriculture is going to be in China for talks.

       Q Ambassador Vershbow had a meeting yesterday at the Russian Ministry of Agriculture about the chicken issue. How confident are you that the issue can be resolved, say, by August when the new certificate is supposed to be in place? And I understand the American side is also asking for a transition period to phase in the new certificate, so how long would that period be?

       MR. LARSON: It may be a sign that the press conference is running out of steam if we're getting questions on other subjects.

       I'm not -- all I'd say on the poultry issue is that it is very important that we move -- both sides move quickly to resolve the final -- the remaining issues and that this trade continue. But I'm not here to make any predictions about that.

       MODERATOR: The lady in the back and --

       MR. LARSON: Yeah, maybe these two and --

       Q Yes. I wanted to ask you a question on TPA.

       MODERATOR: Would you identify yourself, please?

       Q Ana Baron from Clarin, Argentina. I wanted to ask you a question on TPA. If TPA passes, as probably it would, how fast do you think the negotiations with Chile can go forward? And what about negotiations with Uruguay, that was interested also in a bilateral agreement, and eventually with Argentina and other countries?

       MR. LARSON: Yeah. I'm going to take the same general line that Al Johnson took on this. The importance of the TPA considerations in the Congress is the signal that this gives to the world that the United States is ready to step forward and play a leadership role on trade, and we're intending to do that globally in the WTO, as illustrated by this important initiative that Ambassador Zoellick put forward yesterday. We intend to do it regionally through initiatives like the Free Trade Agreement of the Americas. And we intend to do it bilaterally. We want to be on the offensive, looking for opportunities to open markets, create new trading possibilities wherever we can. But I'm going to leave it at that rather than get into -- into specific timetables with Chile or specific prospects for Uruguay.

       MODERATOR: Last question in the back.

       Q Thank you, sir. Wei Jiang (sp) from Phoenix TV of Hong Kong again. Back to your proposals, we hear a lot that this is traded for the better of developing countries. But what is in it for the U.S. to benefit for the American farmers?

       MR. LARSON: Well, a lot. There's a lot in this for American farmers, as well as for developing-country farmers. This is one of a number of issues where we think the interests of the United States are very closely allied with the interests of many developing countries. The United States is a big agricultural producer and a big agricultural exporter, just as many developing countries have significant agricultural sectors.

       So just as the present situation of large trade-distorting subsidies, large export subsidies and large tariff barriers to trade hurt farmers in developing countries, they hurt our farmers.

       And so we see two very important reasons why we want to push this proposal through. One is that it will be a good deal for American farmers. We do have a commercial interest in this. We don't apologize for it. But we also think that it is a very good deal for farmers in developing countries, as well.

       So I think the good news here that I would stress -- particularly for readers in developing countries -- is that we have a very powerful dual interest in pushing this agenda forward. And no one should doubt the commitment that we have to pursue this approach to leveling down all of these trade-distorting measures and then moving to the second phase of eliminating them. That's the proposal that we've put forward today, and again, we would hope to be able to work with developing countries to make this proposal a reality.

       Thank you.

       MODERATOR: Thank you very much, Secretary Larson.

       Thank you, ladies and gentlemen.