G20 farm ministers tussle over trading rules

G20 farm ministers tussle over trading rules

 Paris has made tougher commodity trading rules a priority of its 2011 presidency of the Group of 20 leading economies. President Nicolas Sarkozy has blamed speculators for food price inflation.

But it faces opposition to stringent market rules from Britain and Brazil, as well as reluctance from the likes of China and India to share farm data.

A draft communique obtained by Reuters showed the farm ministers could end up with a watered-down deal limiting decisions to agricultural issues, mainly data or food supplies, not financial markets.

“I prefer to take responsibility for a failure rather than a half-hearted agreement or an agreement for appearance's sake,” French Agriculture Minister Bruno Le Maire told French radio Europe 1, as he made a final push to get an action plan.

He warned that a failure to adopt concrete measures to tame surging staple food prices before the summit concludes on Thursday could give way to more riots. Surging demand for food and fuel will maintain inflationary pressure on commodities this decade, international bodies warned last week.

“The (G20) goal has been set by the president to prevent the 21st century from becoming the century of hunger,” Le Maire told French daily Le Parisien on Wednesday.
While all G20 nations have agreed that steps must be taken to tackle surging food prices, they are split over whether prices should be tamed by regulation or by increased agricultural production.

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Britain, Europe’s financial markets hub, has also said it saw little value in more regulation, but the Russian agriculture ministry told Reuters that Moscow was “ready to give full support to the elaboration of a mechanism of financial regulation and control of the agricultural markets.”

Any G20 deal is likely to disappoint aid charities and farm organisations that have been lobbying for sweeping action. G20 ministers would also agree to set up food aid reserves and remove export restrictions for humanitarian supplies.

But there may be resistance even on these points as China is reluctant to share information it sees as strategic.

China also considers, as does India, that giving exhaustive and timely data on stocks would be difficult for practical reasons.

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