International farm subsidies the next target in Australian plan on carbon
Australia will back a push to slash farm subsidies overseas worth $740 billion a year in the hope of achieving deeper cuts to carbon emissions at the upcoming United Nations climate summit, declaring the payments encourage waste and hurt the environment.
The federal government is joining other big countries in vowing to tackle the subsidies after UN agencies said the spending could balloon to $2.5 trillion and undermine the Paris target to cut greenhouse emissions by 2030.
Trade Minister Dan Tehan will raise issues with farm subsidies paid by the US and EU.Credit:Sarah Baker
The campaign promises benefits for Australian farmers who suffer from their competitors being paid mammoth subsidies in the European Union and the United States, helping Prime Minister Scott Morrison seek a climate deal with the Nationals as soon as next week.
The Australian position, put by Trade Minister Dan Tehan in talks in Europe on Friday, joins calls from Brazil and Indonesia for cuts to subsidies that offer the biggest payments to farmers in wealthy countries and do the most harm to those in the developing world.
Mr Tehan raised the issue with US climate envoy John Kerry in a step toward getting the US, EU and the World Trade Organisation to acknowledge the problem and put it on the agenda at the climate summit that begins in Glasgow on November 1.
“If countries are serious about addressing climate change they have to address all aspects of reducing emissions,” Mr Tehan said in an interview.
“We cannot leave an issue untouched when it ultimately accounts for 25 per cent of emission reduction.
“We’re looking at this and other countries need to do the same.”
Mr Tehan spoke to US Trade Representative Katherine Tai, European Commission Trade Commissioner Valdis Dombrovskis and World Trade Organisation Director-General Ngozi Okonjo-Iweala about setting up a climate group to pursue the issue in trade talks after the Glasgow summit.
Australian governments have long opposed the scale of the US and EU subsidies on the grounds they punish food producers elsewhere, but the climate talks build a stronger case to unwind decades of payments that encourage over-production.
The Food and Agriculture Organisation and other UN agencies estimated last month the subsidies cost $US540 billion ($740 billion) this year and would rise to $US1.8 trillion ($2.5 trillion) by 2030, hurting efforts on climate change.
“These are inefficient, distort food prices, hurt people’s health, degrade the environment, and are often inequitable,” they said.
The EU is promising to reform its subsidies as part of its action on climate change, given agriculture accounts for about 10 per cent of EU emissions.
Agriculture accounts for about 13 per cent of Australian emissions but has been a big source of carbon reductions since 2005, leading Nationals deputy leader and Agriculture Minister David Littleproud to warn that the sector cannot do as much “heavy lifting” in the future.
Mr Tehan acknowledged the campaign on farm subsidies meant Australia would have to accept concerns about fossil fuel subsidies from other countries when Mr Morrison and the federal government are being accused of doing too little to cut emissions.
“If questions are going to be asked about fossil fuel subsidies, which they are, then what we need to be saying is: OK, if we need to take action against fossil fuel subsidies – and the Australian government acknowledges that this is an area that there needs to have action on – then why not do the same on agricultural subsidies?” he said.
The Trade Minister also noted this in remarks to an Organisation for Economic Cooperation and Development meeting on the “green economy” in Paris on Thursday, attended by Mr Kerry, before heading to a meeting of G20 trade ministers in Rome.
The value of the fossil fuel help is forecast to be much more than the farm assistance, the International Monetary Fund estimating last month fossil fuel subsidies are worth about $US6 trillion a year, with 70 per cent made up of “undercharging” for environmental costs.
Mr Tehan expects to raise the subsidy campaign with his Indonesian counterpart, Muhammad Lutfi, in the G20 talks in Rome in the belief developing nations also want the issue on the agenda in Glasgow.
“What this would do is enable developing countries, and countries like Australia, to be able to transition in a way which would help us set ambitious targets when it comes to emission reduction,” he said.
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