Brussels, 29/01/2007 (Agence Europe) - Meeting in Davos on Saturday on the sidelines of the World Economic Forum (24-28 January), the trade ministers of 26 WTO member countries agreed to resume talks on Doha Round trade liberalisation, which have been suspended since July 2006, but did not set a timetable.
Since the opening of the Forum on Thursday, several heads of state and government, present in Switzerland, have lined up to call for the Round to be re-started, thus preparing their ministers for clear encouragement for a formal return to the negotiating table. German Chancellor and President of the European Council Angela Merkel called on negotiators to “show flexibility”. During a debate on Africa, British Prime Minister Tony Blair warned of the “demoralising effect” and “disastrous consequences” for sub-Saharan Africa if the Round failed. Brazilian President Lula de Silva wanted a “signal to the least well-off countries”.
The unanimity at the highest level was followed on Saturday with an agreement at trade minister level that formal negotiations should be resumed (technical discussions in Geneva re-started in mid-November, see EUROPE 9308). After the meeting, WTO Director General Pascal Lamy confirmed that the re-launch of the Round would require new proposals from all parties. “These negotiations will not be concluded on the bases that brought the process to a halt last July. A new American proposal on agricultural subsidies, and new EU proposal on agricultural tariffs and a new Indo-Brazilian proposal on industrial goods and services are needed,” he said.
On Saturday, no new figures and no new timetable were put on the table. On the European side, Trade Commissioner Peter Mandelson would only repeat that “if the conditions were met, the EU is ready to play its part on the agriculture section”. In other words, Europe's chief WTO negotiator could, at the risk of provoking French ire, put forward a new improved agricultural proposal in terms of market access. “We said we were prepared to add more than 10 percentage points” to the proposal for an average agricultural customs duties reduction of 39%, that was tabled in October 2005 “to bring us closer to the demands of the G20” (the emerging countries have called for an average 54% reduction ), Mr Mandelson told his partners. US representative for trade, Susan Schwab, provided assurances that the US was prepared to “do more” to reduce domestic subsidies. Schwab also said that her government was going to ask Congress for an extension on the US negotiating brief, the “Trade Promotion Authority” (TPA), which expires next June. She did warn, however, that this would depend on what was put on the table. Washington is not only expecting gestures to be made by its partners from Europe and emerging countries on access to agricultural markets (discussions with the Union are stumbling on sensitive products, particularly milk and meat products), but is also expecting concessions from most emerging countries on liberalisation of trade in industrial products (NAMA) and services. The Brazilian minister and head of the G20, Celso Amorim, indicated that Brazil was prepared to be flexible if the USA and EU showed willing on agricultural trade. In a reference to US subsidies he said, “I get the impression that they have room for manoeuvre”, adding, “I see a positive attitude but it remains to be seen if they will go as far as we want. We need a breakthrough by the end of March or beginning of April. On what scale, it's difficult to say”. The leader of the Cairns group, Minister Warren Truss from Australia affirmed that “Americans and Europeans have to do more”. Mari Pangestu from Indonesia, head of the G33 special product exporting countries, also said an effort was needed. She insisted that a major breakthrough had to come from a compromise between Europeans and Americans for unblocking the rest of the negotiations.
Although they again limited themselves to making declarations of good intentions, and appeals addressed to Washington and Brussels, trade ministers present at Davos, nevertheless, agreed to adopt a new negotiation strategy and join forces on all chapters in the round: agriculture, industrial products and services, trade facilitation, geographical rules and indications, that were again given a spirited defence by Mr Mandelson at Davos. This new strategy would suggest an inkling of a possible breakthrough in coming months. The aims of resuming in formal negotiations would be to obtain the basis for a principled agreement, before Easter, with clear perspectives on the compensation the Americans could obtain on other aspects of negotiations, in exchange for a reduction in their domestic subsidies - which US president George W. Bush may present to Congress in order to obtain a TPA extension. Mr Lamy, who may call for a green light from the WTO's General Council during its meeting on 8 February to be given to resuming formal negotiations, affirmed “An extension of one year would be enough to conclude the round if an agreement of principle is found in the next few months”. (eh)