The effects of government policy in rich countries
Section F
A result of the Uruguay Round of world trade negotiations is likely to be a reduction of 36 per
cent in the average levels of farm subsidies paid by the rich countries in 1986-1990. Some of
the world's food production will move from Western Europe to regions where subsidies are
lower or non-existent, such as the former communist countries and parts of the developing
world. Some environmentalists worry about this outcome. It will undoubtedly mean more
pressure to convert natural habitat into farmland. But it will also have many desirable
environmental effects. The intensity of farming in the rich world should decline, and the use of
chemical inputs will diminish. Crops are more likely to be grown in the environments to which
they are naturally suited. And more farmers in poor countries will have the money and the
incentive to manage their land in ways that are sustainable in the long run. That is important.
To feed an increasingly hungry world, farmers need every incentive to use their soil and water
effectively and efficiently.
The probable effects of the new international trade agreement