US LAWMAKERS EXTEND FARM BILL FOR A WEEK WHILE PURSUING COMPROMISE

With lawmakers in Washington still struggling to come to agree on a new farm bill, the US House of Representatives on 16 April voted for a one-week extension to the current bill.
As the American planting season begins, US farmers have stressed that if no agreement can be reached, the current farm bill must be renewed for the full year so as to allow them to plan their harvests. The new deadline for the farm bill to expire is 25 April.

While both the House and the Senate approved their own versions of a farm bill last year, a joint committee charged with reconciling the two bills has not been able to agree on how farm spending for the next five years will be funded.

The current bill originally expired last September, but has been extended several times as lawmakers have debated potential reforms.
Rising farm incomes and the bump in commodity prices have led some critics to question the validity of the farm subsidies, but farmers argue that the US must subsidise to stay competitive on world markets.

One of the major sticking points in the current negotiations revolves around a so-called disaster relief fund. A stipulation in the Senate's proposed bill allots $5.1 billion for a fund to protect farmers from droughts, tornadoes, and other natural disasters that could ruin an entire year's harvest. There is no such provision in the House's bill, but farmers have lobbied hard for its inclusion in the final legislation, with support from influential farm state senators.

The current proposed version of the bill allows for $268 billion to be spent on farming and nutrition programs, but the plan calls for the money to be raised with new taxes and creative accounting methods described by critics as 'gimmicks.' Lawmakers are scrambling to find new sources of funding for the bill, as President George W. Bush has made it clear to Congress that he would veto any farm bill reform that raises taxes.

Conservationists are also worried, as lawmakers have proposed slashing funding to key conservation programs that have been sustained by the current farm bill. However, they are worried that potential improvements to conservation plans might be lost if a new bill is not approved.

ICTSD reporting; "Opposition surfaces to Farm Bill Proposal" ASSOCIATED PRESS, 28 February 2008; "Land Once Preserved Now being farmed," US NEWS AND WORLD REPORT, 31 March 2008; "Congress debating bill to keep farm subsidies", SAN FRANCISCO CHRONICLE, 15 April 2008.


ASEAN COMPLETES FTA WITH JAPAN

The Association of Southeast Asian Nations and Japan have finished signing a free trade agreement, with the formal assent of Malaysia on 14 April.

Malaysia was the last member of the ten-country trading bloc to sign the ASEAN-Japan Cooperative Economic Partnership (AJCEP). Finalised last November, the pact, which calls for the elimination of tariffs on 90 percent of goods within ten years, should come into effect later this year. The comprehensive agreement also includes investor protections and provisions on services trade.

Before the agreement can enter into force, ASEAN countries -- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar (Burma), the Philippines, Singapore, Thailand and Vietnam -- must gain domestic legislative approval. AJCEP will become active on a country by country basis within two months of the first ASEAN member country gaining domestic approval.
Japanese Foreign Affairs Minister Masahiko Koumura released a statement saying "Japan hopes the agreement will further invigorate the trade and investment relations between Japan and ASEAN and enhance economic attractiveness of the Japan-ASEAN region."

Tokyo already has bilateral trade agreements in place with six of the ten ASEAN countries, but this is the first time that it has entered into an agreement with a multinational bloc.
Observers close to the foreign ministry say that Tokyo has long-term hopes of a more comprehensive trade programme including China, India, and Australia, but such a program is still in the thought process stage.

Along those lines, India has announced its hopes to have a comprehensive economic agreement with ASEAN completed by August, as it has completed bilateral negotiations with all member countries except for Indonesia.

ICTSD reporting; "India bridges gap with ASEAN on trade pact" THE ECONOMIC TIMES, 15 April 15, 2008. "Japan, ASEAN finish inking free trade pact: statement," AGENCE FRANCE PRESSE, 14 April 2008.