Brussels, 22/06/2007 (Agence Europe) - On Friday, Pascal Lamy sought to rekindle the hope that a multilateral agreement could be reached on global trade in the wake of the stalled Potsdam meeting where G4 negotiators (EU, USA, Brazil and India) were unable to overcome their disagreements and left the negotiating table early (EUROPE 9451). “Prior convergence among these members would have been helpful to pave the way towards multilateral convergence. But helpful does not mean indispensable. This negotiation is an endeavour among the 150 members of the WTO”, the WTO director general said, before adding: “The negotiating process is driven by the Chairs of the negotiating groups, who have responsibility to table compromise texts in their respective areas”. “I now call on the members of the G4 to contribute to the multilateral negotiating process, which will continue as of today in Geneva”, Mr Lamy said. The chairmen of the committee on farm talks and the committee on negotiations for industrial products (NAMA), Crawford Falconer and Don Stephenson, will publish their revised compromise texts next week.
On Thursday, the G4 partners confirmed their commitment to the multilateral process. “We believe in this process. We will do everything we can to make it work”, said Peter Mandelson, the trade commissioner. His colleague for agriculture, Mariann Fischer-Boel, was not so hopeful. “We of course hope that the Geneva process can do better, but frankly I am not optimistic”, she said. Without a compromise at the G4, it is difficult to imagine that the 150 WTO members will, in July, reach a compromise on the basis of the texts of agreement promised by Mr Lamy with a view to concluding the round by end 2007. These texts will probably not prevent discussions from staying where they are until at least 2009, pending US and Indian elections.
Views differ over reasons for failure
After their meeting, the members of the G-4 dismissed all responsibility for the stalled talks in Potsdam. American and European officials accused Brazil and India of not having returned the favour after the concessions made in the agricultural area by refusing to open up their industrial and services markets. “The effort that we were asking of the advanced developing countries was not unreasonable. We were asking them to cut only one in two industrial tariffs by an average of 1.3 percentage points. These are economies that for all of their development challenges are growing fast and are competitive in many sectors - for example automotive, textiles and aircraft. In the case of most of these countries, what is envisaged is just continuing the liberalisation they themselves have undertaken over the last decade”, Mr Mandelson explained on Thursday. Susan Schwab, of the US, felt that the package on the table would not have been enough to generate trade flows, to support development and to reduce poverty. She went on to say that the effort asked of Brazil and India with regard to NAMA is minimal compared to the protection that these countries have, with reference to exemptions (special products and special safeguard mechanisms) to increased farm market access by the G20. Mike Johanns, US secretary for agriculture, accused the Brazilians and the Indians of having moved the goal posts just as a goal was about to be scored, by stepping up NAMA requirements. The Union cannot negotiate when there is hardly anything in return, stressed Mr Mandelson, who nonetheless spoke of European flexibility on agricultural issues. “We were ready to make our last move in agriculture”, he assured. This last offer concerned a greater reduction in the highest European agricultural duties. Europe was prepared to cut average farm tariffs by more than half, to eliminate export subsidies by 2013 and cut trade distorting domestic farm subsidies by more than 70%. “Even for products that are sensitive for us like beef, new export possibilities the size of total Argentinean beef exports were on the table”, explained Ms Fischer-Boel. “But the opportunity for us to do so did not arise, because it became clear during our discussions that the response that would be offered in industrial goods was not enough to negotiate on”, Mr Mandelson concluded.
The Brazilian and Indian negotiators accused their northern partners of wanting to continue with the imbalances of global trade. Celso Amorim of Brazil stressed that liberalisation of the farm markets was at the origin of the disagreement. “There was neither logic nor justice” in the US proposals, deplored his Indian opposite number, Kamal Nath, with reference to Washington's offer to limit domestic subsidies to $17 billion per year (compared to $22 billion in its initial offer). The G20 finds this concession insufficient, demanding a ceiling of $12-15 billion. Rich countries, Mr Nath believes, are seeking the “perpetuation of inequities”. He went on to say by way of conclusion: “The Doha Round must create developing country trade flows towards the developed countries and not the other way round”. (eh/lc)