Brussels, 26/06/2008 (Agence Europe) - Believing that the political and technical conditions are ripe for agreement before the summer on the three key chapters of the Doha negotiations - agriculture subsidies, agriculture market access and industrial market access - WTO Director General Pascal Lamy will convene a meeting of the ministers of some 30 trading powers, in Geneva in the week of 21 July, to try to seal a compromise on trade liberalisation modalities for agricultural goods and industrial goods (NAMA). Discussions may have intensified in Geneva since the 19 May publication of the revised compromise texts on agricultural goods and NAMA (see EUROPE 9664), but the differences between the rich and developing countries on these two chapters cast doubt over Lamy's optimism, whose decision is beginning to look like a high risk strategy.
“I know that there are risks involved, but I think that there is a better than even chance of reaching an agreement,” Lamy told the ambassadors of the countries involved. The latest attempts - in Geneva in June 2006, and in Potsdam in June 2007 - turned into fiasco. The head of the WTO has only one thing in mind, however: to submit a possible agreement to the current US administration before the hand-over of power in January 2009 and thus to conclude the round. The whiff of protectionism in the speeches of the presidential candidates suggests that ratification by Washington after that date will be postponed indefinitely.
There are still wide differences among the trading powers. On Wednesday 25 June, the European Commission said it backed Lamy's decision and called on emerging countries to “show the same degree of flexibility” as the EU. The staff of American representative Susan Schwab highlighted that there were still considerable differences on agriculture, industry and services. Stressing that agriculture remained at the heart of the discussions, India denounced the lack of visibility on the objective of subsidy reduction and the new rules to be put in place, and called on the rich countries to be more concrete in their offers.
Developing countries are deeply pessimistic. The format of the preparatory discussions for the ministerial meeting annoys their delegations who feel ignored. The ambassadors and high-ranking officials of around 30 countries have been negotiating since the start of June in a consultation group behind closed doors, meeting twice a week with Lamy. In parallel, discussions on NAMA are continuing with 12 countries, pushed forward by the United States. The agriculture and NAMA mediators Crawford Falmconer and Don Stephenson are continuing their consultations with delegations.
Developing countries consider, moreover, that talks are far from complete on either of these two chapters. In agriculture, many delegations have expressed concern about the lack of an American move on domestic subsidies, all the more as the new Farm Bill provides for them to be increased. The members are also said to be far from an agreement on the special safeguard mechanism, which aims to protect developing countries from a brutal rise in imports. Discussions on tropical products are also marking time. ACP countries fear that the liberalisation of trade for their products, as the EU would like, endangers their economies which depend upon the trade in sugar, bananas, fresh and dried fruit, groundnut oil, cacao etc. On the NAMA chapter, several questions may lead to failure. Headed by South Africa, Argentina, Brazil, Egypt and India, the NAMA-11 countries are opposed to a reduction in tariffs requested of them in the last revised draft compromise. Progress was made during talks among the twelve on loopholes allowed to the Mercosur countries and South Africa regarding a reduction in customs duties. But the states remain divided over the possibility offered to a country to defend a whole sector of its economy against tariff reductions. (E.H./transl.rt)