10 



You also speak about the potential in the Korean market. Is that 

 much of a market for us, and if so, what commodities? 



Mr. Goldthwait. The Korean market is, I think, one of our best 

 prospects. It is on our list of the 15 markets with the greatest po- 

 tential for U.S. agriculture, and I think there we are talking about 

 opportunities really across the board. There are opportunities for 

 the growth of exports of wheat, of cotton. In the feed grains area, 

 it depends on what happens with Chinese corn exports. 



Turning to the high value or consumer ready sector, we see op- 

 portunities for practically any product where we can reach agree- 

 ment on access on a phytosanitary basis. We are working with the 

 core reasons, we have some reductions that we referred to in the 

 testimony on some of the tariffs. And we just think that is a tre- 

 mendous market across the board. 



Mr. Penny. You indicate that the European Community has sub- 

 sidies. I assume you are talking export subsidies, they will be re- 

 duced by more than 2.6 million tons annually. Is that over the 

 course of the GATT agreement? 



Mr. Goldthwait. That is over the implementation period. 



Mr. Penny. And just a reduction in subsidies doesn't automati- 

 cally mean a bushel-for-bushel or ton-for-ton increase in our ex- 

 ports, but what do you think the opportunity is for the United 

 States to pick up market share as those subsidies are scaled back? 

 What is the range that we are projecting? 



Mr. Goldthwait. Again, I can't give you a precise range. We 

 think we will recover some market share. I would think we will re- 

 cover, particularly some of the recent erosion we have seen in the 

 Western Hemisphere, where previous subsidies have been a very 

 important factor over the past year. 



There are a number of other factors here that are going to be ex- 

 tremely important that make it difficult to make precise estimates. 

 You referred in your opening remarks to the trade distorting prac- 

 tices that are not addressed in the Uruguay Round. We are looking 

 at those, of course. And where of course the adjustment within the 

 EU's internal production system may also enable it to be somewhat 

 more competitive in its geographic, particularly proximate markets 

 in the absence of subsidies. 



Mr. Penny. You mention the strategic planning efforts at the De- 

 partment, and among those, the long-term ag trade strategy report. 

 In the testimony from GAO, they cite a key weakness being that 

 the LATS sets no priorities. It calls for the fullest possible use of 

 all export assistance programs without identifying which pro- 

 grams — activities — are critical or most important. 



In the opinion of GAO, LATS needs additional work to become 

 a useful management tool to guide program development and re- 

 source allocation. How do you respond to those criticisms? 



Mr. Goldthwait. I think in the revision of the LATS, you will 

 see a somewhat different approach. And I think you will see a 

 much more concerted effort to focus on individual markets and 

 produce descriptions of what mix of resources seems to be nec- 

 essary to reach growth targets in those specific markets. And this 

 work, of course, will be done using input from our various program 

 users, as well as our own ideas and those of our field staff. 



