GENEVA, July 21: The United States and European Union turned up the heat on emerging economies at crucial WTO trade talks on Monday, warning that a global deal could only be done if they opened up their markets.
EU Trade Commissioner Peter Mandelson even implied an ultimatum, saying he had gone out on a limb on agricultural trade and stressing that agreement was now conditional on developing countries making “real” cuts in their industrial tariffs.
But Indonesian Trade Minister Mari Elka Pangestu, speaking on behalf of the G33 group of developing countries, insisted it was up to industrialised nations to make an effort to reach a deal.
Ministers from 35 key countries are meeting in Geneva this week to hammer out a global deal, which has so far proved elusive. The nearly seven-year-old Doha round of trade liberalisation talks, held under the auspices of the World Trade Organisation, is deadlocked.
Peter Mandelson, under strong political pressure — notably from France — to harden his stance on industrial trade, said emerging economies must make “real” cuts in industrial tariffs.
“These cuts must provide some new market access in practice. That is the political bottom line. Nothing else will work for us. Nothing else will close the deal,” he said.
Mandelson had said Europe was prepared to make “painful” cuts in its payments to farmers, but only if it received guarantees of progress on industrial tariffs and services.
The EU commissioner earlier revealed that the European Union was now ready to extend proposed cuts in its tariffs on farm produce to 60 per cent from 54 per cent.
But the offer was dismissed as “propaganda” by Brazil, a key emerging market player at the Doha talks.
US Trade Representative Susan Schwab also turned the spotlight on emerging market countries, which she said had a “fundamentally critical role”.
She noted that much of the developing world itself did not have sufficient access to the rapidly emerging markets.
“Seventy per cent of the tariffs paid by developing countries are paid by other developing countries, they aren’t paid by developed countries,” she said.
The United States was prepared to make concessions in return for the same from emerging countries, she said, maintaining that “vast overwhelming contribution” had to come through market liberalisation rather than subsidy cuts.
But Indonesian Trade Minister Pangestu contended that industrialised countries, and not emerging economies, were the ones that should make concessions.
“We continue to believe that huge subsidies in agriculture (by) developed countries are accountable for the distortion to the world market.—Agencies