Posted
28th August 2001
The Political Tectonics Of GE
I. US-Europe By Alan
Sipress and Marc Kaufman, Washington Post Staff Writers,
Sunday, August 26, 2001; Page A01
Senior Bush administration officials are pressuring the European
Union to abandon new restrictions on genetically modified foods
that they say could cost U.S. companies $4 billion a year and
disrupt efforts to launch a new round of global trade talks.
U.S. officials have repeatedly told their European counterparts
that the regulations, which received preliminary approval last
month, discriminate against U.S. products in violation of World
Trade Organization requirements, raising the prospect of a major
and emotionally charged trade dispute.
The European Commission's decision to require the labeling of
genetically engineered products reflects a European anxiety
about food safety that is far more profound than in the United
States, the world leader in agricultural biotechnology. This
is a divide that threatens to further aggravate U.S. relations
with Europe, already roiled by differences over global warming,
arms control and other trade issues. Undersecretary of State
Alan P. Larson, the State Department's senior diplomat assigned
to economic issues, called the new restrictions "trade disruptive
and discriminatory." He said, "It's obviously a very serious
problem that affects a very important trade and one that's of
vital interest to a very important constituency in the United
States, which supports free trade."
Though U.S. officials have declined publicly to detail what
type of punitive action the Bush administration might take against
Europe, U.S. officials say the regulations are inconsistent
with the terms of the WTO because they treat U.S. products less
favorably than European ones. For instance, Larson said the
European regulations would require that American crushed soybean
oil bear a label, while European cheeses and wine made with
biotech enzymes would not be covered. "There are potential WTO
concerns about how it is structured now," Larson said. U.S.
officials have left open the possibility of bringing a legal
case before the WTO, which, after lengthy litigation, could
eventually impose a politically embarrassing judgment and stiff
economic penalties on Europe. But Larson said the administration's
immediate focus is on lobbying European governments to amend
the regulations before they take effect. He added that the United
States and Europe need to resolve the issue quickly so it does
not become a "distraction" that interferes with their shared
interest in launching new global trade talks as planned later
this year.
Officials said that economic losses in the United States --
where 75 percent of soybeans and more than 25 percent of corn
comes from genetically modified seeds -- could far exceed other
transatlantic trade battles, such as those over bananas and
growth hormones in beef. Resolution of the long-running banana
dispute earlier this year removed a major irritant in American-European
relations. The dispute could also harden public opinion about
biotechnology and its ability to transfer beneficial genes from
one species into another. Proponents want it to be seen as a
force for progress and global improvement, but it could become
a symbol of divisiveness if it set off a bitter trade dispute.
The
European Commission's new standards, among the most far-reaching
in the world, call for all products made from engineered material
to bear a label saying they contain "genetically modified organisms."
They also require producers to document the source of all their
ingredients. Since the U.S. crop-handling system generally does
not separate modified and conventional crops, the new requirements
could be unwieldy and costly for U.S. businesses. European limitations
on biotech crops already ban most U.S. corn for food products,
estimated by U.S. officials as a $300 million annual loss. The
new requirements, which must be approved by the European Parliament
and Council of Ministers before taking effect by 2003, could
also make it difficult to export corn for animal feed and soybeans.
Larson
said in an interview that he has raised U.S. concerns with "everyone
that comes through this door, every trade minister, agriculture
minister, economy minister from Europe," including those representing
about eight European countries. He said a similar message has
also been delivered by Agriculture Secretary Ann M. Veneman
and U.S. Trade Representative Robert B. Zoellick. President
Bush, who comes from a large farm state and counts on the agriculture
industry for political support, raised the issue personally
with European leaders last month at the Group of Eight meeting
of industrialized countries in Italy, according to a senior
administration official.
Kimball Nil of the American Soybean Association said the food
industry is pleased by the tough talk. "The Bush administration
met with EU commissioners and very clearly laid down a marker
that many of us felt was missing before," he said. But European
officials chafe at the pressure, saying the administration is
trying to impose U.S. acceptance of biotech food on a European
public that does not believe these products are safe despite
scientists' claims. The spread of mad cow disease and other
health crises have fueled public concern about food safety,
and prominent officials, including Britain's Prince Charles,
have been highly critical about biotechnology in crops. "We
are seeing an illustration of American unilateralism," said
Tony Van der haegen, a European Commission representative in
Washington. "There are basic psychological differences between
American consumers and those in Europe, where [genetically modified
products] are not accepted."
Requiring food labels is a way of offering choice to consumers
and restoring their confidence in food, Van der haegen said.
He added that the United States has exaggerated the potential
loss to U.S. companies, putting the figure instead at $2.8 billion
a year. On a policy level, U.S. regulators have embraced the
position that engineered and traditional crops are essentially
equivalent, and so should be treated the same. There is some
public -- and congressional -- pressure to require labeling
of modified foods in the United States, but promoters of biotechnology
have fought tenaciously, and successfully, to resist the efforts.
They argue that labels would unfairly stigmatize the products.
The European Union has not approved any new engineered crops
for almost three years, and it has been under great pressure
from the United States to begin the review process again. The
new regulations allow for biotech crop reviews to resume, but
only with the requirements that U.S. officials find objectionable.
In an Aug. 9 letter to Secretary of State Colin L. Powell, Veneman
and Zoellick, 24 U.S. trade organizations said the proposed
EU guidelines on biotechnology in agriculture are "commercially
unworkable, inconsistent with WTO obligations and would result
in billions of dollars of lost U.S. exports." The letter, signed
by groups ranging from the Grocery Manufacturers of America
to the American Soybean Association and the North American Export
Grain Association, said the measure would cause a "serious trade
impediment" by requiring labeling and tracing of modified foods,
but not of European wines and cheeses. The European regulations
would not apply to the latter items because the requirements
distinguish between food made from genetically modified material
such as seeds and those produced with the assistance of modified
material such as enzymes. Larson wrote back this week that "I
share many of your apprehensions regarding the proposals," and
said he was working to "ensure that any measures [implemented
by the EU] are not onerous, costly or trade-disruptive."
Mark Mansour, a Washington attorney who represents large food
companies and has been consulted by administration officials,
has written an analysis urging the administration to file a
case with the WTO as soon as possible. Mansour also recommends
that the United States withdraw support for the international
Biosafety Protocol negotiated in Montreal, a Clinton-era agreement
that accepted some of the European concerns about genetically
modified foods. As the regulations now move to the European
Parliament, legislators may tighten the restrictions further.
Environmental groups are urging them to remove a provision that
waives the labeling requirement if the percentage of genetically
modified material in a food item is less than 1 percent of the
overall product. "The U.S. is trying to force-feed modified
foods to the rest of the world, and it just isn't going to work,"
said Charles Margulis of Greenpeace, which has led the anti-biotech
campaign in Europe.
U.S. troubles over biotechnology and international trade are
not limited to the European Union. The governments of Saudi
Arabia and Sri Lanka have proposed bans on importing genetically
modified foods, and Mexican legislators are also discussing
tough labeling laws. Larson said the United States is concerned
that the EU biotech guidelines could become a model for developing
countries and significantly limit the reach of the technology.
Advocates of biotechnology say it can be especially helpful
to poor farmers by increasing their yields, protecting against
pests and viruses, and allowing them to grow crops in depleted
soil. But critics say poor farmers will never see those potential
benefits because the technology is owned by private, multinational
companies interested primarily in selling seeds for a profit
to commercial growers.
II. Sri-Lanka NZ by Joanne Black, Evening Post ,27 August
2001
The NZ Dairy Board was forced to withdraw several cartons of
processed cheese, believed to be destined for McDonald's in
Sri Lanka, after Sri lanka ordered an unprecedented crackdown
on genetically modified foods. The Sir Lankan action, understood
by the NZ government to be the harshest in the world against
genetically modified organisms, was made via a regulation on
May l but it has since been suspended until September l. After
the regulation was promulgated various trading partners, including
NZ which has a significant dairy trade with Sri Lanka, made
representations to the Colombo government.
A spokewoman for Trade Minister Jim Sutton said that apart from
difficulties with the drafting of the regulation, Sri Lanka
had also failed to give the required 60 days notice of changes
under the World Trade Orgnaisation rules. The new regulation
not only banned the importation, manufacture, sale or distribution
of all genetically modified foods, but also required verification
that imported products, including soy, corn, tomato and cheese,
contained no ingredients or materials subject to genetic modification.
Dairy Board spokeman Neville Martin said the cartons of processed
cheese caught by the ban used lecithin as an emulsifier. Lecithin
has a soy content and often soy is a genetically modified crop.
Mr. Martin said the cartons of cheese, which he believed were
destined for McDonalds, were replaced by a product that met
the Sri Lankan requirements. A range of emulsifiers were available
that did not have GE ingredients. Mr. Martin said cheese using
the same emulsifier was sold in NZ, like hundreds of other products
that contained GE-modified soy. He said although there were
nonGE options to the emulsifier, it would continue to be used
in some cheeses until consumers shoed they no longer wanted
it.
The NZ government understands the new regulation probably will
stay in force from Sept l but, in practice, Sri Lanka will accept
imports accompanied by a certificate saying there was no GE
content detectable in the final product... . ..
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