[QODLink]
Europe
WTO optimistic on trade deal
Geneva talks reach compromise over tariff and subsidy cuts.
Last Modified: 27 Jul 2008 08:46 GMT
Mandelson said that there could still be "potholes" ahead [AFP]

World Trade Organisation (WTO) talks in Geneva will continue through to Wednesday after a last-minute compromise deal was brokered by Pascal Lamy, the WTO chief, in which the world's more developed countries would cut subsidies and imports tariffs.

Peter Mandelson, the European trade commissioner, said at the end of Saturday's talks that the WTO was "closer to a deal than we have been at any point in the last seven years".

The proposed changes include EU and US farm subsidy cuts of up to 80 per cent.

The compromise is that developing countries must open their markets to imports of manufactured goods, removing so-called "import shields".

Keith Rockwell, a WTO spokesman in Geneva, told Al Jazeera that the extended talks followed progress by Indian negotiators, which included a safeguard mechanism that would enable India to protect products that faced import surges.

India, which has pushed hard for a better deal for developing countries, said it was not satisfied with the proposals put forward before Saturday's negotiations.

Ujal Singh Bhatia, India's WTO ambassador, said before the talks: "We have brought many goodies and we expect to receive new goodies. And if we don't, we will go back with the same goodies that we came with."

'Compromise'

Rockwell said a "compromise" had been achieved.

"With 153 countries trying to agree to consensus on certain topics - without compromise, there's nothing," he said.

"It's not about making decisions here, but about signalling intentions in terms of opening markets to foreign service providers. It went quite well, and I think ministers are pleased.

"There are outstanding issues. There are some issues that pertain to the poorest companies - cotton subsidies for example; the erosion of trade preferences."

"We are by no means finished," he said.

Europe's trade negotiators were encouraged to press on with the deals by most EU countries, in a bid to rescue a world trade deal, but France, Italy and some others expressed concern about how the talks were shaping up.

The Doha negotiations for a global trade deal were launched in 2001 with the aim of boosting the world economy and helping to fight poverty.

The chances of a long-elusive breakthrough were almost written off earlier this week given the deadlock in the talks, but they improved on Friday when new compromise proposals were welcomed by several key WTO players.

Mandelson told reporters on the sixth day of intensive talks: "There are still potential potholes in the road ... [And] we will return to the "green room" tomorrow with the backing of EU member states to work on this emerging deal."

EU opposition

Without a breakthrough now, the talks risk being frozen for a further another two years while the United States and the European Commission change administrations and India holds elections.

Mandelson has been criticised for offering too many agricultural concessions [AFP]
A few EU countries, including current EU president France, opposed the proposals as a basis for further talks when Mandelson briefed the bloc, according to officials who attended the meeting.

Mandelson negotiates trade deals for the 27-country EU, but individual countries have the power of veto over a final deal.

The British commissioner has come under attack from Nicolas Sarkozy, French president, for offering too much on agriculture and getting little in return on industrial goods, key to European exporters of cars, chemicals and textiles.

Silvio Berlusconi, the Italian prime minister, said on Saturday he and Sarkozy had "deep concern" about the proposals and would remain in touch as the talks continue.

Adolfo Urso, Italy's senior trade official, said he wanted more market access for industrial goods than offered in Lamy's draft, and progress protecting place names associated with certain products, such as Champagne and Parma ham.

Ewa Bjorling, Sweden's trade minister, said his country would accept the package now on the table.

Anne-Marie Idrac, the French trade secretary, said several EU countries were concerned the proposals were not balanced and needed to secure more access to markets in developing countries. Ireland also expressed disquiet.

Mary Coughlan, Ireland's deputy prime minister, said: "There is considerable disquiet and discontent [among EU countries] on a number of the specific aspects of it.

"We have a couple of issues and one, of course, is agriculture. And we don't see the balance in Nama [trade in industrial goods], and we haven't seen services at all as of yet."

Current rules

The WTO's Rockwell said that under curreny regulations, the US was spending under $10bn on subsidies, despite having the right to go up to $48bn. The the EU has the right to go up to €110bn in trade distorting subsidies, he said.

India's WTO representatives negotiated hard for developing countries [AFP]
"If you can bring these ceilings down, you can bring a great deal of comfort for poor farmers in developing countries.

"Absent of that, these countries have the freedom to raise their support to levels that could be extremely injurious to farmers in the developing world.

"If you look at the tariff cuts on products of interest to developing countries, they are profound," Rockwell said.

"And for the least developed countries, there are special packages that would eliminate all tariffs, all quotas on 97 per cent of the products that are shipped to the developed world."

Mandelson said he and Mariann Fischer Boel, the European agricultural commissioner, "were well satisfied with the backing that we received."

Most EU ministers said "it would be very, very regrettable and a serious loss for the world if the Doha round were to fail."

One diplomat said that the talks, originally scheduled to end on Saturday, had been extended to July 30 but a WTO spokesman said there was no formal end-date.

Mandelson said the Lamy compromise was "not beautiful, but it's finally put together what will be a genuine boost for the world economy".

But Rob Davies, the South African deputy trade minister, was more sombre than that.

"Even if we reach an agreement ... I don't think we go out and can tell the world that this is an outcome that is going to solve the development problems of the world. It certainly won't.

"It will fall far short of that," he said.

Source:
Al Jazeera and agencies
Topics in this article
People
Country
Organisation
Featured on Al Jazeera
Italy struggles to deal with growing flood of migrants willing to risk their lives to reach the nearest European shores.
Israel's Operation Protective Edge is the third major offensive on the Gaza Strip in six years.
Muslims and Arabs in the US say they face discrimination in many areas of life, 13 years after the 9/11 attacks.
At one UN site alone, approximately four children below the age of five are dying each day.
Featured
The world's newest professional sport comes from an unlikely source: video games.
The group's takeover of farms in Qaraqosh, 30km from Mosul, has caused fear among residents, and a jump in food prices.
Protests and online activism in recent months have brought a resurgence of ethnic Oromo nationalism in Ethiopia.
Chemotherapy is big business, but some US doctors say it could be overused and are pushing for cheaper and better care.
Amid vote audit and horse-trading, politicians of all hues agree a compromise is needed to avoid political instability.
join our mailing list