EU points finger at AWB in monopolies battleEmail Print Normal...

EU points finger at AWB in monopolies battle
Email Print Normal font Large font By Shane Wright
December 17, 2005

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AdvertisementTHE European Union has increased pressure on the Federal Government to strip the AWB of its monopoly powers.

At the sixth ministerial World Trade Organisation conference in Hong Kong, EU officials said it was clear that AWB would not survive in a country where antitrust and pro-competition rules existed.

They also said Australian farmers were financial losers from the arrangement as they could only sell wheat for export through one company, AWB.

The comments will inflame the stoush between Australia and the EU over AWB, which has veto powers over grain export sales. As part of wider WTO negotiations, the EU is targeting state trading enterprises with export monopolies such as AWB, the Canadian Wheat Board and New Zealand dairy giant Fonterra.

Australia maintains AWB's monopoly powers do not distort trade and could not be considered an export subsidy. But senior EU officials said it was clear by the very powers AWB had it was a monopoly, and so by definition was trade distorting. "If these monopoly powers do not have any trade distorting effects, then why maintain them?" the official said.

The spokesman also said AWB would be dismantled if it had to face the same competition rules as Europe. "Australian Trade Minister Mark Vaile should put AWB's powers to the test applied in those other nations," he said. "Just ask him to apply normal competitive rules that you have in every other normal civilised country."

An Australian trade negotiator said Europe had failed to show if there were any subsidies involved in the way AWB operated. "We have yet to have demonstrated to us what those subsidy elements are," he said.

Agriculture Minister Peter McGauran rejected the criticism: "The wheat export single desk operates on commercial terms, with no government financing or underwriting."

AAP