HONG KONG, Dec 18: Global trade talks here headed off a failure similar to that in Seattle and Cancun by striking an interim deal on eliminating farm subsidies by the year 2013. The Sixth WTO Hong Kong Ministerial Conference rounded off its gruelling deliberations by agreeing to do away with export subsidy on cotton by 2006.

Ministers from 149 member countries also agreed to reduce trade distorting domestic subsidies on cotton production more ambitiously. This was made possible by the United States withdrawing its objection on the issue.

But the deadline set for ending farm subsidies — the key sticking point holding up the crucial talks – is subject to completion of modalities to be agreed in a follow-up consultation in Geneva next year.

Ministers expressed relief that they had averted a repeat of failed conferences in Seattle in 1999 and in Cancun in 2003.

But they described the Hong Kong pact as disappointing and said it would be tough to wrap up the talks on time by the end of 2006, after which US President George W. Bush may lose his Congressional authority to negotiate trade deals.

“In a week of disappointments, this is no small prize,” said European Union Trade Commissioner Peter Mandelson. “It is not enough to make this meeting a true success. But it is enough to save it from failure.”

The World Trade Organisation (WTO) agreement came after six round-the-clock days of fractious talks between ministers at a Hong Kong harbour-side convention centre and anti-globalisation protests outside that erupted into vicious street battles.

The ministerial text provides better protection for textile producing countries, including Pakistan, by limiting the percentage of products exported from least developed countries (LDCs) to the rich nations with duty-free and quota-free access.

Pakistan would be better placed now because its apparel and textile products would enjoy the same access as is allowed to countries like Bangladesh and Cambodia, particularly in the US market.

Pakistan’s civil society groups, including Sustainable Development Policy Institute (SDPI) and Actionaid, partially welcomed the ministerial text but called for ensuring more protection for the marginalized people of developing nations.

The end date for export subsidy was one issue that was left unresolved during the last five days of negotiations. But during last night’s green room talks, the European Union suggested 2013 as a possible date to end subsidies whereas the G-20 members, the United States and other countries pushed for 2010 as the deadline.

The US has offered to cut its cotton export subsidies by 2006 but there is not decision as to when it would eliminate its domestic support for cotton.

During the last five days, the developing and least developing countries (LDCs) stood united and put pressure on the EU and US for being flexible on important issues such as agriculture and non-agriculture market access (NAMA).

According to the ministerial text, the elimination of export subsidies would be achieved in a progressive and parallel number. This means that in case the Doha Development Agenda becomes effective from 2007, a major part of the subsidies would be practically eliminated by 2010.

The 149 members, however, resolved to establish modalities no later than April 30, 2006, and to submit comprehensive draft schedules based on these modalities no later than July 31, 2006, on agriculture and NAMA.

The draft on services has been termed “vague with lot of fine prints” by many developing countries, especially Cuba, who suggested a change in the text. However, in the teeth of opposition from developing countries, the annex C was included in the text mainly on the insistence of the EU and USA.