GENEVA, June 30: Ministers from world's top trading nations on Friday were facing another crisis in their five-year drive to break down protectionist barriers, with the United States, the European Union and key developing countries still at odds over vital farm and industrial trade issues.

As ministers ended a second day of talks in Geneva, World Trade Organisation chief Pascal Lamy said the talks to liberalise global trade launched five years ago in Doha were in a difficult `red zone’.

Mr Lamy, who is working against the clock to clinch a deal in Geneva so that the WTO talks can be concluded as scheduled at the end of 2006, accused ministers of engaging in political rhetoric instead of showing the ‘political courage’ to take decisions.

"If we do not turn things around radically in the next few hours or days, we will quite frankly be facing a crisis," Mr Lamy told ministers.

Signalling growing pessimism over prospects of an outline deal over the weekend, Lamy said ministers were repeating set positions instead of making fresh offers which would break the negotiating deadlock.

Unlike previous WTO meetings which have focused on the EU's farm policies -- with the US and poorer nations castigating Brussels for its high farm tariffs -- the spotlight this time around is on the US.

The EU and key developing nations, including Brazil and India, are demanding that Washington make big cuts in its domestic farm support programme, worth $150 billion between 1995 and 2005.

But US Trade Representative Susan Schwab and Agriculture Secretary Mike Johanns said the US would only change farm support levels if the EU and developing nations further slashed import tariffs for farm products.

"Market access is the key that will unlock the negotiations," Mr Johanns told reporters. High agricultural tariffs made it "impossible to sell products" abroad, he added.

As the sniping continued, however, EU officials insisted that the US must make a ‘real movement’ to reduce its farm sector hand-outs. "US farm support is simply trade-distorting," said an EU spokesman.

Indian Commerce Minister Kamal Nath also lashed out at Washington's stance, saying there must be a trade-off between reductions in farm subsidies and tariff cuts.

"Substantial reduction in farm support is a prerequisite for market access improvements," Mr Nath told reporters.

Washington has said that a proposal from India, Brazil and other G20 group of developing countries for an average 54-per cent cut in import tariffs is inadequate. The US is also unhappy with an EU offer to make a 39-per cent reduction in farm import tariffs.

Indicating a new flexibility in the EU stance, the bloc's trade chief Peter Mandelson told reporters in Geneva he was ready to move “substantially closer" to the G20 position if other countries also showed flexibility.

With prospects for a weekend deal fading fast amid finger-pointing among ministers, European trade officials said there was a "high degree of pessimism" at the talks.

Mr Lamy has warned the future of the Doha trade talks as well as the WTO itself and the multilateral trading system was at risk.

If no decisions were taken on cutting farm and industrial tariffs -- as well as reducing farm support -- over the weekend, there could be no progress in other areas, such as services, Mr Lamy cautioned.

The Geneva meeting is the highest-level effort to break the current negotiating deadlock in the five-year old Doha round of WTO talks since a ministerial meeting in Hong Kong in December.

Officials in Geneva say that failure to reach an agreement this week will jeopardize prospects for an accord on a final global trade package at the end of 2006.

The year-end deadline is seen as crucial because President George W. Bush's fast-track authority to strike trade deals expires next year. Without it, any WTO agreement could be picked apart by US legislators seeking to amend the accord.

If ministers fail to clinch an agreement this weekend, WTO officials said, another meeting could be scheduled for the end of July, giving the US more time to switch its stance.