Half of the wheat grown in the U.S. is destined for export markets. Producers want to be reliable exporters. We therefore urge the World Trade Organization to discourage unilateral sanctions of agricultural products by member countries, except during war or a national emergency.
U.S. Wheat Associates and many other agricultural groups in the U.S. have been urging our Congress to enact legislation that would exempt food and medical supplies from existing and prospective U.S. unilateral sanctions. We will continue to urge Congress to act.
In the meantime, we seek WTO’s assistance. One of the professed benefits of the WTO is that smaller countries have some increased bargaining power. A recent WTO document points out that “without a multilateral regime such as the WTO’s system, the more powerful countries would be freer to impose their will unilaterally on their smaller trading partners. Smaller countries would have to deal with each of the major economic powers individually, and would be much less able to resist unwanted pressure.” We respectfully suggest that the goal of WTO is laudatory, and discouraging unilateral economic sanctions, especially in the case of food and medical supplies, is completely consistent with the goals of the organization.
The Inclusion of Agricultural Commodities in Unilateral Sanctions is Not Effective
The Foreign Agricultural Service of the USDA confirms the experiences of the U.S. wheat industry: as regards agricultural commodities, “single-desk countries modify their sales programs to take advantage of U.S. sanctions.” Unlike comprehensive multilateral sanctions, unilateral sanctions provide easier marketing opportunities for U.S. wheat’s market competitors, i.e., Canada, Australia, and the European Union. For instance, since U.S. sanctions were imposed on Iran, Canadian wheat exports to that country have tripled. Those exporters may also obtain higher prices in the sanctioned countries because of reduced competition.
Simply put, if one country doesn’t provide wheat, someone else will. Thus, even though a country may attempt to impose their will unilaterally, it is not at all clear that the unilateral sanction accomplishes its goal. Indeed, all it may do is drive up the cost of bread for consumers in the sanctioned country.
The Domestic Price of Unilateral Sanctions Outweighs Foreign Policy Benefits
Since most of the world’s consumers live beyond our borders, U.S. wheat producers are committed to seeking increased access to the world market. Wheat imports by Cuba, Iran, Iraq, Libya, Sudan and North Korea represent more than 15% of world trade — a segment of the market that has been effectively closed to American farmers. Restricting markets when wheat stocks are high and prices are low seems counterproductive to the best interests of U.S. farm policy and is incompatible with the principles of “Right to Farm.” There is also little evidence that unilateral sanctions help to influence another country’s policies.
Eliminating Unilateral Economic Sanctions is Good Policy
Few alternatives exist to the use of military force when one country seeks to alter the policies of another country. One of those alternatives is the imposition of economic sanctions. But imposing economic sanctions for political purposes while, at the same time, opposing barriers set up by other countries in order to facilitate their political purposes, seems to be disingenuous as well as ineffective.