US pledges billion-dollar farm subsidies to offset trade disruption

25 Jul 18

The US government has pledged to give American farmers billions of dollars in aid to mitigate the impact of the current trade war.

The programme would pay up to $12bn to subsidise farmers, intended as a temporary boost while trade negotiations take place.

Sonny Perdue, secretary of the Department of Agriculture, said on Tuesday: “This obviously is a short-term solution that will give President Trump time to work on a long-term trade policy.”

Farmers have particularly been affected by the trade war, as countries seek to retaliate for Trump’s duties on steel and aluminium.

Affected countries, including China, European Union nations, Canada and Mexico, have targeted US agricultural products, such as soybeans, peanuts, orange juice, dairy, meat products.

According to the Department for Agriculture, the US exported $138bn in agriculture products in 2017, including $21.5bn of soybeans.

Shortly after the US administration’s announcement about the funds, Trump called for the EU to “drop all tariffs, barriers and subsidies”, in a tweet.

Ahead of European Commission president Jean-Claude Juncker visit to Washington, he said both the US and the EU should drop tariffs to lead the way to a “free market and fair trade”.

Earlier this month, the International Monetary Fund warned that rising trade tensions between the US and the rest of the world could cost the global economy hundreds of billions of dollars.

Did you enjoy this article?

Related articles

Have your say

CIPFA latest