Battle Over Biotechnology Intensifies Trade War
The New York Times, USA,
by Elizabeth Becker with David Barboza
http://www.nytimes.com/2003/05/29/business/29BIOT.html

DATE: May 29, 2003

Battle Over Biotechnology Intensifies Trade War

WASHINGTON, May 28 - President Bush said last week that Europe's
opposition to genetically altered crops was a threat to efforts to end
world hunger.

But even many critics of Europe's stance say that the president's
argument does not stand up and that the dispute needs to be understood
for what it is: a multibillion-dollar cross-Atlantic battle over
agricultural trade.

The disagreement will be played out this week at the meeting in France
of the leading industrial countries. It pits European leaders, who say
they are worried about the safety of importing genetically altered
crops from the United States, against the Bush administration, which
insists that Europe's attempts to block the crops are an illegal trade
tactic.

The trade dispute heated up after an intense lobbying effort here in
Washington, where some of the nation's most powerful interest groups -
farmers, the food industry and giant biotechnology companies - have
been pressing the administration to take on their case at a time of
heightened tensions between the United States and Europe.

Lawyers and lobbyists for some interest groups have descended on the
White House and Capitol Hill over the last few weeks to influence
policy makers and lawmakers, and in some cases, to simply remind them
of the importance of the Farm Belt in the next election.

Some of the biggest agriculture and biotechnology companies have
invested billions of dollars over the last decade to develop
genetically altered crops. Nearly 100 million acres of farmland in the
United States are now planted with genetically altered crops, and
agriculture officials say farmers have lost at least $1 billion over
the last five years because they have been unable to export some
biotechnology crops to Europe.

"We've been very patient with the Europeans, but their use of this ban
as a trade barrier sets a precedent for countries around the world,"
said Mary Kay Thatcher, director of public policy at the American Farm
Bureau Federation.

"We rely on export markets for one-third of our crops; this is a
nightmare," she added.

Last week, the United States filed the equivalent of a lawsuit at the
World Trade Organization, arguing that Europe's effort to block some
genetically altered crops violated international trade rules.

At the Group of 8 summit in France this week, the Bush administration
is expected to press its case that Europe accept genetically altered
crops.

But instead of arguing in the name of Monsanto - the giant of
agricultural biotechnology companies - or American farmers, Mr. Bush
and his aides will raise the issue of fighting world hunger.

In a speech last week he accused Europe of hindering the "great cause
of ending hunger in Africa" by banning genetically modified crops.
Administration officials say that such moves by Europe encourage
African nations to reject technology that could save millions of
lives.

That has upset European diplomats who are negotiating a compromise on
biotechnology.

"It is quite shocking of Mr. Bush to tell us to follow his lead on
African aid when the United States gives one of the smallest
proportion of its gross domestic product for global development than
any other wealthy nation," said a senior diplomat here. "This has not
helped us."

Pascal Lamy, the top European trade official, even challenged the
notion that Europe has a moratorium, saying that Europe is on the
verge of completing new regulations that could open up the Continent
to more genetically modified crops.

Europe approved the sale of genetically altered soybeans in the
1990's, but then in 1998 Europe instituted a moratorium on approving
new biotechnology crops like certain varieties of genetically altered
corn. So while soybeans have been largely unaffected by the
moratorium, corn exports have been harmed.

Several agriculture experts who want to lift European restrictions
said that the problem would not be solved by opening up Europe's
market.

"It's quite a stretch to tie the problem of the ban against
genetically modified food in Europe to starving children in Africa,"
said Dan Glickman, who served as secretary of agriculture in the
Clinton administration. "It is also a bit provocative to say the
Europeans don't care about world hunger."

Scientists also agree.

"In general, that is not the case at all," said Pedro Sanchez,
director of tropical agriculture at the Earth Institute at Columbia
University.

"The main problems in Africa have to do with soil fertility," he said.
"Until you solve the soil problems, it doesn't matter whether you use
conventional or genetically modified seeds."

Backers of genetically altered crops say that they have been properly
tested and that there is no scientific evidence that they pose a risk
to humans or the environment.

Mickey Kantor, the first trade representative for President Clinton
and a lawyer whose firm represents Monsanto, says the trade dispute
has grown beyond complaints from biotechnology companies.

"It's not just about the industry anymore," he said. "It is a
technology that can have a positive effect on world hunger."

If the biotechnology companies had done more for poor countries, that
argument might hold, said Peter Pringle, author of the coming book,
"Food, Inc.," (Simon & Schuster 2003).

Instead, he writes in his study of biotechnology, "while the industry
claimed that their products would save the world from malnutrition,
seed companies created only crops that made money for themselves and
the wealthier farmers who could afford the premiums."

The current trade debate centers on opposing views about food safety
and the need to test a product before it is put on the grocery shelf.
How this dispute is resolved could determine the future course of
agriculture, according to many agriculture economists.

Genetically altered crops, which have been biologically altered to do
things like release their own insecticide, are already planted on more
than 140 million acres worldwide, mostly in North and South America.

But consumers and regulators in Europe worry that the crops could pose
a threat to humans or the environment.

Five years ago, Europe placed a moratorium on approving biotechnology
crops. In preparing to end the moratorium, Europe is planning to
impose new rules and regulations to trace crops back to their origin
and label all genetically modified products, a move that could make it
more difficult for Americans to export their biotechnology crops to
Europe.

America's two biggest agricultural exports - corn and soybeans - could
be greatly threatened by the new regulations to label the product,
industry officials say.

"We think that's the equivalent of putting a skull and crossbones on
the packages, saying these things are bad," said Bob Callanan, a
spokesman for the American Soybean Association in St. Louis.

American exports of corn to Europe have virtually dried up because
corn farmers have widely adopted a form of biotech corn that kills
pests.

"We went from about a 1.5 million metric ton market in 1998 to 23,000
metric tons, so it's pretty much been obliterated," said Hayden
Milberg, director of public policy at the National Corn Growers
Association, which is based in St. Louis.

The corn industry estimates that it has lost more than $1 billion
since the moratorium.

Some farmers are questioning the administration's strategy for opening
the European market.

Harvey Joe Sanner, the director of the Soybean Producers of America,
said Europe was the largest export customer for soybeans last year and
he criticized some of the stronger remarks made by Robert B. Zoellick,
the United States trade representative, in the current dispute.

"We are very concerned with the harsh rhetoric of late by Mr.
Zoellick," he said in a statement today. "I am wondering how brilliant
it is for a key government official, who should be promoting sales of
U.S. soybeans, to use such derogatory terms in describing our largest
single buyer."