The next negotiator is Dr. James Murphy, Junior. Dr. Murphy is the Assistant U.S. Trade Representative for Agricultural Affairs in the Office of the United States Trade Representative.

Over the last 17 years, Dr. Murphy has held a number of positions within the USTR. Dr. Murphy also has California connections, having attended Claremont Graduate School in Claremont, California.

Dr. Murphy.

ASSISTANT U.S. TRADE REPRESENTATIVE MURPHY: Thank you very much, Secretary Lyons. And I want to add my thanks to Secretary Rominger as well as for the warm welcome we had from the Speaker this morning and his hospitality for breakfast. And I particularly want to thank Secretary Lyons and his superb team for the excellent job they have done organizing this session and providing this opportunity for us to be here and to hear the advice and wisdom of the folks who will speak to us today. And it's very good to see a number of long-term friends here and I look forward to hearing from them. And we're happy that Director Jones from Agriculture in Arizona could be here with us as well.

This is a listening session and that's why we are here. I do want to make a couple of brief remarks before we begin to listen, the first being on U.S. agricultural trade policy, which is rooted in a few basic facts and I think is fairly simple to see. And it's rooted first in the fact that American farmers and ranchers are, indeed, the most competitive and the most technologically advanced producers in the world.

And because of that, we produce far more than we can consume in this country, which immediately suggests the importance of export markets and the central need for access to those markets to have a prosperous farm economy.

California is exporting in the neighborhood of $7.7 billion worth of agricultural products each year and is the top exporter of the 50 states. And Secretary Rominger noted somewhere in the order of 30 percent of gross farm receipts come from those exports. So access to foreign markets is absolutely essential for prosperity of our economy generally, and certainly for the ag economy.

This is where trade agreements come into the picture. As you know, the World Trade Organization is where we negotiate the rules of the game for trade, where countries make commitments to those rules to help guarantee access to markets which are so critical. The U.S. has been in a leadership position both in creating the WTO 50 years ago and in shaping the rules contained in that organization that we live by today.

In the Uruguay Round negotiations, we, for the first time, began to bring agriculture under the rules of the game that prevail for other sectors. Prior to that, agriculture had been primarily not covered by those rules. We cut tariffs, we put disciplines on subsidies, we achieved minimum guaranteed market access for products which had not had it before, we negotiated a sanitary and phytosanitary agreement, which helped assure that rules governing those areas would be based in sound science and science-based risk assessments, we created a stronger enforcement mechanism, for which the U.S. has been the most aggressive user. We have won 22 out of the 24 dispute settlement cases we have pursued, roughly half of which have been in the area of agriculture.

We have, of course, also been negotiating a number of bilateral trade agreements. We have negotiated the terms of accession for China to the WTO, which has had some significant -- or will have, once it's completed, some significant market access provisions. For example, beef tariffs will drop from 45 percent to 12 percent, wine will drop from 65 to 20 and I was very happy that the Speaker noted his interest in wine, which we have just launched a negotiation with the European Union on.

But as we all know, and why we're here today, much remains to be done and the Uruguay Round was only a start for us. Many problems remain, and as was noted, the President has called for a new round of negotiations to address those problems.

The U.S. will host the Third WTO Ministerial Session in Seattle, November 30th to December 3rd. It will be the largest trade event ever to occur in this country. One hundred and thirty-four countries will send delegations. And it will involve in the order of some 5,000 people.

Agriculture is very much a part of what we call the built-in agenda. It was recognized by all in the Uruguay Round we had not finished the job on agriculture, and therefore there was a commitment written into the Uruguay Round Agreement to resume negotiations on agriculture at the end of this year.

The agenda for that round is what we're here to talk about today. There seems to be a general consensus that we should build on the Uruguay Round Agreement and maintain, what we call, the architecture of that round, which has three primary legs. There is the market access side, tariffs, tariff rate quotas, the size of those quotas and how they're administered; there's export competition, which includes export subsidies, export taxes, et cetera; and there's domestic support.

In addition, there are two new issues, which were not addressed in the Uruguay Round, which we are hearing from a number of people we need to address this time around. One is State Trading Enterprises, such entities as the Canadian Report, Australian Report. And the other area is new technology in a particular biotechnology about which we've been hearing quite a bit from these sessions and I expect we'll here something today.

So we're here to seek your advice. We don't want to fight the last war this time around. We want you to tell us what needs to be done, things that we have overlooked and the emphasis that we should take, priorities that we should set, and we look very much forward to having that advice from you today. And we want to stress that this is the beginning of a process, these listening sessions.

The negotiations, as I indicated, will start at the end of this year, beginning of next year. It will be a three-year process. We hope not a seven or eight year one as we had at the Uruguay Round. But the consultations that we're beginning today will continue over that period of time. As issues arise, with this country's tabled proposals and offers, we'll want to continue that consultative process. So we urge you to do this as the beginning of that process and not to be at all reluctant to come to us, write to us, call us, meet with us and continue to provide your good advice, so that we get it right this time around.

Thank you.