WTO states fail to agree on farm, tariff cuts: Lamy asked to end deadlock
By Shadaba Islam
Geneva, July 1: Ministers from the world's top trading nations on Saturday failed to agree new moves to slash farm and industrial tariffs and curb agriculture subsidies, with members of the World Trade Organisation (WTO) engaging in a damaging blame game over responsibility for the deadlock.
Delegates said WTO chief Pascal Lamy had been asked to try and end the bickering and forge a breakthrough by end-July, allowing a new trade expansion deal to be clinched by the end of the year.
As ministers from up to 50 nations failed to end long-standing rifts over slashing tariffs and cutting domestic farm subsidies, European Union (EU) Trade Chief Peter Mandelson told reporters Lamy was being asked to act as a "catalyst" to help strike the long-sought accord.
Lamy would be mandated to hold "urgent consultations and use his good offices" to try and forge compromises, Mandelson said.
Mandelson also insisted it was time leaders, rather than ministers, took charge of the faltering WTO discussions.
A special trade summit, involving leaders from the United States, the EU, Japan, Australia, India and Brazil, could be held on the sidelines of a Group of Eight (G8) meeting of the world's top industrial nations in Russia in mid-July, he said.
The US, the EU and Japan are also members of the G8 whose other participants include Russia, Canada, France, Italy and Britain.
"This has not been a successful meeting," Mandelson said after the Geneva talks came to a halt over countries' failure to strike much-needed deals on a so-called ”triangle” of issues including cuts in farm and industrial tariffs as well as moves to reduce farm support.
"It is five minutes to midnight if we want to end the current round by end-year," said Mandelson, adding that to meet the deadline "key pieces of the jigsaw" would have to be in place by the end of July.
Most delegates blamed the US for the lack of progress, saying no breakthroughs in the vital farm sector were possible until Washington agreed to reduce billions of dollars worth of handouts paid out annually to the American farmers.
The EU and developing countries insist that US farm subsidies — worth up to $150 billion between 1995 and 2005 — distort global trade flows by giving American farmers an unfair competitive advantage over those in poorer nations.
But US officials, under pressure from their domestic farm lobbies and powerful members of Congress, pointed an accusing finger at the EU and key developing countries, including Brazil and India, for obstructing access to their farm markets.
US Trade Representative Susan Schwab said the impasse in Geneva was not Washington's fault since ”we are not in a position to settle for some mediocre version of a trade round that doesn't deliver real market access and new trade flows.”
US Agriculture Secretary Mike Johanns insisted that Washington would only reduce farm subsidies if it obtained guarantees of improved sales opportunities on European and other markets.
Schwab reinforced the message by warning: "Until and unless there is more market access on table it is hard to imagine having further dialogue on subsidies."
"Unfortunately we have not seen necessary progress...the focus has been on loopholes," Schwab said referring to the EU and other countries' demands for special tariff treatment for so-called sensitive farm products.
However, in contrast to their past tough stance, EU officials at the talks signalled a new readiness to further slash import tariffs but said this was conditional on US moves to reduce farm support.
Mandelson, winning new friends among developing countries, said he was ready to move ”substantially closer” to poor nations' demands for import tariff cuts worth 54 per cent instead of the bloc's current offer of a 39 per cent cut - provided others made similar concessions.
Developing countries welcomed the EU stance but accused the US of making excessive demands for access to poor nations' markets.
WTO chief Lamy has repeatedly warned that success in the Doha talks was essential for the credibility of the WTO and the multilateral trading system.
Experts say a new trade liberalisation deal is needed to stem protectionism, curb enthusiasm for bilateral trade pacts and boostdevelopment in poor countries.
