Feted Potato May Get Special Treatment in WTO Deal

The potato, celebrated by the United Nations this year as a cheap source of nourishment, is also turning heads in global free trade talks where both rich and poor countries are vying to protect their farmers.

Potatoes are on the list of "tropical and alternative" products that would get special treatment under the World Trade Organisation's (WTO) Doha round, an agreement aiming to boost global trade flows and help poor-country exporters.

That list, proposed by developing economies including Bolivia, Costa Rica, Peru and Venezuela, also recommends better access to rich countries for agricultural exports such as roses, bananas, avocados, papayas, cassava, coffee, ginger, palm oil, cane molasses and cocoa powder.

But many rich countries, among them Switzerland, the United States, and Canada, also see the potato as one of their key crops, and fear its classification as a tropical product could put their own farmers at a disadvantage.

The European Union is pushing for a much shorter list of tropical products, which excludes the spud, to be used as the basis for ongoing negotiations in Geneva.

The question of how to handle potatoes cuts to the core of problems marring the Doha round, now in its seventh year.

Efforts to wrap up the deal in 2008 hinge on a breakthrough in the agriculture negotiating committee, where many of the WTO's 151 members have sought to avoid cuts to the tariffs and subsidies shielding their most valued foods from competition.

"For centuries, potatoes have been a staple in diets across the world. It is a product in which many countries have great interest," WTO spokesman Keith Rockwell told Reuters.

"Resolving this issue will be key to finding a solution in agriculture and hence the Doha round," he said.

ALTERNATIVE

The U.N.'s Food and Agricultural Organisation (FAO) has designated 2008 the International Year of the Potato, and is promoting the carbohydrate-rich tuber as an alternative to wheat, rice and other globally traded commodities whose prices have shot up in past months.

Eric Kueneman of the FAO's International Year of the Potato Secretariat said that while potatoes are indigenous to South America, they are grown in large quantities in China, India and Russia, and could be used elsewhere to fight hunger and poverty.

"Expanding the production of potato in some cases can contribute to reducing the shortages of rice and wheat that are too expensive and not available for importation," he said in a telephone interview from Rome.

The international potato trade is worth about $6 billion a year and is dominated by frozen and dehydrated products, such as french fries and potato chips, which developing countries tend to import from rich markets instead of producing themselves.

Many poorer economies would benefit from investments in storage facilities to keep potato stocks cool, Kueneman said.

"You can't process on much of a scale for the industrial market if you don't have a way to store it," he said. "Some infrastructure and technology developments have to be in place."

Economists say a Doha deal -- which would make it easier and cheaper to export food, fuels, cars, and clothes, as well as to provide cross-border services such as transportation -- would add billions of dollars to the global economy each year.