USA’s ‘inflexibility’ halts WTO talks

The refusal of American negotiators to give any more ground on their domestic farm supports is being cited as the main reason for the collapse of crucial world trade talks in Geneva last weekend.

World Trade Organisation officials had hoped that the gathering of over 40 trade ministers would move the Doha Development Round forward.

Their aim is to establish modalities – fixing the precise level of cuts in import tariffs, trade distorting domestic supports and export aids – by the end of July.

But after three days of talks, it was clear that little, if any progress had been made, prompting WTO director general Pascal Lamy to declare the talks “in crisis”.

“I will not beat about the bush,” he said.

“This is serious, not only for agriculture and industrial tariffs, but for the Round as a whole.”

During the course of the talks, trade commissioner Peter Mandelson made it clear he was willing to open up EU markets to food imports further.

He was prepared to move closer to the developing countries’ demand for a 52% average tariff cut compared with the 38% he offered last October.

But the USA showed no flexibility in reducing its trade distorting domestic farm supports any further, while Brazil and India refused to offer any more access to their markets for industrial goods.

“The EU continues to be the only party prepared to move and showing determination to get an agreement,” said Spanish MEP Enrique Crespo, who chairs the EU parliament’s trade committee.

Another meeting of trade ministers has been inked in for the end of July.

This is viewed as the last chance to get a deal on modalities, if the WTO is to complete the Round before the USA’s “fast track” negotiating authority expires at the start of next year.