Posted on September, 28, 2018 at 11:10 am
By Arvin Donley
ARLINGTON, VIRGINIA, U.S. — The U.S. Wheat Associates (USW) testified on Sept. 26 that an ongoing series of policies that disrupts global demand for U.S. wheat and does not comply with World Trade Organization (WTO) rules should disqualify Turkey for eligibility under the Generalized System of Preferences (GSP) program.
Ben Connor, vice-president of policy at USW, testified on behalf of the organization at a hearing held by the Office of the U.S. Trade Representative (USTR).
On Aug. 3, the USTR announced a new Generalized System of Preferences (GSP) eligibility review of Turkey.
Conner explained that the GSP program provides preferential access to the U.S. market for developing countries that meet program standards. In 2017, he said Turkey exported $1.7 billion in goods to the United States under GSP, making it one of the program’s largest beneficiaries.
Conner said the law authorizing GSP requires beneficiary countries to refrain from engaging in “unreasonable export practices.” He said USW believes that Turkey’s inward processing system for wheat and flour functions as an unreasonable export practice.
“Farmers have been complaining about Turkish flour for the better part of a decade due to the displacement of U.S. wheat in critical markets,” Conner said. “The fundamental problems are Turkey’s excessive domestic support and high tariffs combined with an inward processing regime that does not meet World Trade Organization standards.”
USW said it objects to continued GSP eligibility for Turkey based on its failure to reform practices that subsidize exports of wheat flour, harming both the interests of U.S. wheat farmers and their customers in third-country markets.
One of the USW’s top policy priorities is to see Turkey bring its wheat policy regime in line with its WTO commitments, it said.
Turkey has argued in WTO committees and elsewhere that its flour exports are market-driven and simply reflect the competitiveness of its flour milling sector. The USW said it would take “a willful suspension of disbelief to think that one of the most protected wheat markets in the world (Turkey’s applies a 45% tariff; until 2017 it was 130%) could somehow become the world’s most competitive wheat flour exporter on purely commercial terms.”
Turkey has been the world’s top flour exporter over the last five years, accounting for one-third of all flour exports.
Source: WORLD-GRAIN.COM