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INTERVIEW - Senator urges US take EU to WTO on biotech

INTERVIEW - Senator urges US take EU to WTO on biotech
WASHINGTON - The incoming chairman of the Senate Finance Committee on Monday said he has urged the Bush administration to launch legal action against the European Union for thwarting sales of U.S. genetically modified crops.
Sen. Charles Grassley, an Iowa Republican, told Reuters there was broad support in the U.S. agriculture community for taking the EU to the World Trade Organization on the issue. Grassley said he has told the office of U.S. Trade Representative Robert Zoellick \"that we need to move with a suit. There\'s wide support for drawing a line in the sand.\" U.S. farmers complain they have lost hundreds of millions of dollars in annual sales because of the EU\'s four-year-old moratorium on approvals of genetically modified goods, ranging from corn and soybeans to pharmaceuticals. About 70 percent of soybeans and 25 percent of corn grown in the United States are genetically modified. While some of the biotech varieties have been approved for human consumption, EU consumers have shown deep suspicion and little appetite for the new varieties. The Bush administration appears to be leaning toward filing such a trade case, after initially hoping it could avoid that action by persuading the EU to drop its moratorium. President George W. Bush\'s Cabinet is expected to meet sometime soon to discuss possible U.S. legal action. But David Hegwood, special agriculture adviser at the U.S. Department of Agriculture, left open the possibility of a case not being filed. \"If we can get the moratorium lifted without taking a case, then it saves us a whole lot of time and trouble. But that\'s our ultimate objective, to get the moratorium lifted.\" Asked what the disadvantages were to filing a case, Hegwood noted it could have an impact on \"other trade issues we have with Europe,\" as well as potential \"backlash\" against biotech foods by European consumers. \"These are things we\'ve been weighing for some time,\" he said. In a speech at a U.S. Chamber of Commerce forum on biotechnology, Hegwood focused his remarks on the EU\'s \"illegal\" biotech regime and noted, \"The U.S. lost a $200 million corn market in Europe.\" Grassley said the administration should go forward with a case, even though some fear that could prompt the EU to retaliate against $4 billion worth of U.S. agricultural products and other goods in a separate dispute over U.S. tax breaks for exporters. \"I\'ve read that threat. But, you know, they expect us to live up to our (WTO commitments in the export tax case), I suppose we expect them to live up to theirs too. It\'s just enforcing the rule of law,\" Grassley said. The WTO has given the EU permission to slap sanctions on slightly more than $4 billion worth of goods in the tax spat. So far, it has not taken that action, based largely on Bush\'s pledge that the United States would change its international tax code to comply with WTO rulings. Taking the EU to the WTO over genetically modified products runs the risk of inflaming transatlantic trade tensions at a time when the White House is trying to build up international support for a possible invasion of Iraq. In recent weeks, the EU has taken some steps in toward lifting its moratorium. But those steps may be too little too late to stop a U.S. trade case now that some biotech food aid from the United States is being turned away by starving Africans who say they fear getting on the wrong side of the EU\'s ban. Story by Doug Palmer REUTERS NEWS PICTURE SERVICE
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