GENEVA, Nov 9: China has threatened to veto any proposals on cutting customs tariffs on industrial goods at the World Trade Organisation (WTO) if its requests are not met, trade sources said on Friday.

During a meeting of the negotiating group on non-agricultural market access (Nama), China’s delegate said he had received instructions from Beijing to veto any revised text put forward by group chair Don Stephenson if it “proposed flexibilities that failed to meet China’s minimum requirements,” the sources said.

China did not make clear what its precise requirements were, they added.

The move was seen as a bid to put pressure on the negotiations in the Doha Round of trade liberalisation talks. But sources said it would be very difficult for China to veto the whole Doha package as Beijing stands to make substantial gains from a successful WTO deal.“It could just be grandstanding,” a trade source said.

“You cannot take all these things very literally,” another source from a developing economy added, noting that political rhetoric is an integral part of trade negotiations.

Back in July, Stephenson, who is also Canada’s ambassador to the WTO, issued draft proposals that called for a cut in industrial tariffs charged by about 30 developing nations to less than 23 per cent.

The proposals drew a large amount of criticism, particularly from the “NAMA 11” group of developing nations that views them as unfair and too generous to developed countries.

China’s objections are “just another symptom” of the widespread dissatisfaction, a trade source from a developing country told AFP.

The current text needs substantial revision or it could be blocked not just by China but a large number of countries, the source added.

For China, which is classed as a developing nation as part of its WTO accession agreement, Stephenson’s proposals would mean a cut to between 6.1 and 6.5 per cent on average, from 9.0 per cent currently.

China would “not accept a provision in the new text that would be discriminatory,” the sources cited the delegate as saying.

The European Union reacted sharply to the Chinese intervention, warning it could spark “political reactions” given China’s weight in the world economy, the sources added.

Washington’s ambassador to the WTO did say earlier this week that China and other developing countries such as Brazil and India needed to demonstrate more flexibility on NAMA in order for the US administration to convince Congress to approve any final deal.

“If China, Brazil, South Africa, Argentina, India and others are not making reasonable contributions, then we won’t be able to make that demonstration,” ambassador Peter Allgeier told AFP in an interview.

Noting that some of the NAMA 11 countries are key agricultural exporters, the US ambassador said “there needs to be a fair contribution from them in light of potentially what they can get” from a successful Doha round.

Stephenson was due to issue a revised “modalities” text on November 15 but trade sources said that this will now be delayed by one or two weeks due to a similar impasse on agriculture talks.—AFP