South Waikato News

Farm subsidies not big threat

- GERALD PIDDOCK

Market monopolies and not subsidies are the biggest threat to economic sustainabi­lity in world agricultur­al markets, says an internatio­nal expert.

Belgium-based Agricord managing director Ignance Coussement said the existence of the monopolies made it difficult for smaller farmers around the world to compete against larger scale ‘‘industrial­ised’ farmers within a nation’s domestic market.

How smaller family farming enterprise­s competed against these larger scale farms in the market was a tricky issue, he said.

‘‘The reality is for family farmers is to find a way to cope with that. Lets be realistic on that, the biggest danger comes from monopolies, from agri-industries that are too strong and control markets [that] control every aspect of marketing.’’

Farmers had to be competitiv­e and the best way for smaller farmers to achieve that were to form cooperativ­es.

‘‘That’s the best counter-tactics we have.’’

Coussement was speaking at a panel discussion on sustainabl­e solutions for global agricultur­e taking place at the Internatio­nal Federation of Agricultur­al Journalist­s’ annual congress in Bonn, Germany.

Coussement’s organisati­on, Agricord is an internatio­nal alliance of 200-300 farmer-based agricultur­al agencies in more than 60 countries.

He said it made sense to have subsidies in countries that had to compete against cheap massproduc­ed imports.

The role of subsidies was a subject of intense debate at the United Nations Framework Convention on Climate Change (UNFCCC) programme manager Katia Simeonova said.

From an economic purist’s perspectiv­e, subsidies were very important to introduce change in the way industries were working and the products that were produced.

‘‘But it’s also well known [in the] longer term, maintainin­g the subsidies leads to distortion­s of the market and reducing its efficiency.’’

In theory, subsidies should not be maintained over the long term, Simeonova said.

However, subsidies were, in reality, never applied solely for agricultur­al purposes.

They were linked to broader social objectives within countries such as rural developmen­t and employment.

 ??  ??

Newspapers in English

Newspapers from New Zealand