"There's a lot of activity and some indications of movement. I remain cautiously optimistic that we can get a really worthwhile agreement and progress here in Cancun," said Britain's trade secretary Patricia Hewitt as the session ended on Friday.

   

The World Bank estimates a deal to lower global trade barriers could add more than $500 billion a year to global incomes by 2015, lifting 144 million people out of poverty.

 

Scuttle

   

The 4,700 delegates to the World Trade Organization (WTO) talks realise that, with US elections in 2004 and the European Union preoccupied with the entry of 10 new members, failure now could scuttle chances of a deal for several years.

 

WTO chief Supachai Panitchpakdi:
difficult task ahead

"I hope Cancun turns out as an important turning point because this is an opportunity for developing countries to leave the imprint of their stance on the WTO," said India’s Commerce Minister Arun Jaitley, adding: "If they miss this opportunity, the next will not come for decades."

   

A senior US official said talks with an assertive new alliance of 21 developing countries, led by heavyweights India, China, Brazil and South Africa, had been positive.

   

He said Singapore Trade Minister George Yeo, who is trying to reconcile the many differing positions within the 146-member WTO, still faced a very tough task. But the official added: "Overall, we're still optimistic that this will all come together."

  

Thomas Aquino, the Philippine undersecretary for trade, struck a similar note: "Something will come out of this."

 

The Group of 21 developing countries has put pressure on the United States, the EU and Japan by demanding rich countries slash about $300 billion a year in agricultural subsidies.

 

Subsidies

   

Subsidies shield farmers in wealthy countries and impoverish millions of their own farmers who are unable to compete with subsidised exports from the West, complains the Group of 21.

   

Gregor Kreuzhuber, a spokesman for European Farm Commissioner Franz Fischler, cautioned that major differences remained and said there was no reason to be overly optimistic or enthusiastic.

   

But "certain glimmers of hope are appearing. Tomorrow is the day, tomorrow is the crunch day," Kreuzhuber said, referring to Saturday’s discussion.

   

Ministers and officials planned to work late into the night to produce a compromise text that would provide the basis for a frenzied finale to the week-long negotiations.

"If the text is well-received, I hope we'll be sunbathing on Sunday," said Carlos Perez del Castillo, who heads the WTO's general council.

"I hope Cancun turns out as an important turning point because this is an opportunity for developing countries to leave the imprint of their stance on the WTO"

Arun Jaitley,
commerce minister, India

Agriculture is not the only make-or-break issue at Cancun.

   

Attempts by the EU and Japan to graft guidelines on foreign investment and competition onto world trade rules have run into fierce opposition from an array of developing states.

   

Jaitley and Malaysian trade minister Rafidah Aziz expressed the "firm view" on behalf of nearly 60 countries that negotiations on the proposed new rules were a non-starter.

   

Thousands of anti-capitalism activists have descended on Cancun, a swanky Caribbean beach resort, and are planning a big anti-WTO march on Saturday.

   

Police sealed off the glamorous hotel district on Friday to protect negotiators and there were no major clashes.

 

Ministers face a weekend of marathon negotiations if they are to find enough common ground to revive hopes of concluding a new global trade pact by their self-imposed deadline of the end of 2004. The Cancun talks are due to end on Sunday.