World Trade Organisation chief Mike Moore has warned that the US' decision to impose steel import tariffs and boost farm aid could derail an essential reform of the European Union's own agricultural subsidy programme.

"If you happen to be a reforming minister and want to do something about agriculture in Europe, it now becomes that much more difficult to convince your colleagues," Mr Moore told the AFX news agency.

The warning comes days before the European Commission is due to unveil fresh proposals for reforming the EU Common Agricultural Policy, which subsidises European farmers to the tune of 40 billion euros a year.

The reform is aimed at slashing farm subsidies, paving the way for up to ten eastern European nations to join the EU in a few years' time.

The EU would be bankrupted if it had to extend its current subsidy programme to the applicant countries, many of which have large and inefficient agriculture sectors.

Digging in

Mr Moore said the US stance on steel, and its controversial decision to boost farm aid by up to $180bn over the next ten years, is likely to harden opposition to reducing agricultural subsidies within the EU.

EU members with large farm sectors and influential agricultural lobbies, notably France, Ireland and Spain, have in the past fought moves to trim agricultural aid.

Mr Moore added that the supported the EU's plans to expand eastwards.

"I think this is very healthy. It certainly puts pressure on budgets in Brussels," he said.

Third time lucky?

The European Commission is expected to publish its latest farm reform package next week.

This is the EU's third attempt in ten years at reining in the Common Agricultural Policy, which eats up about half the trade bloc's annual budget.

Two previous reform programmes, launched in 1992 and 1997, managed to curb chronic overproduction by European farmers.

But in both cases, radical reform proposals were heavily diluted during bitterly contested negotiations between the European Commission and EU member states.