Doha trade talks on brink of collapse 

Efforts to free up global trade and extend the benefits of globalisation to the world's poorest countries have yet again stumbled against a feud over the depth of cuts that should be applied to EU agricultural tariffs and US farm subsidies. 

The difference this time is that, rather than laying the blame on each other (EurActiv 26/07/06), the EU and the US are pointing the finger at India and Brazil's flat refusal to budge on opening-up their markets to industrial goods and services. 

While developing countries – excluded from the closed-door talks between the 'big four' in Postdam – are deeply critical of rich country subsidies for agricultural production, which allows them to dump their products on developing country markets, they are also starting to mark their distance from Brazil and India, which they fear are ignoring their key concerns. 

Talks will now move back to the WTO in Geneva, among all 150 members, but optimism is at an all-time low. 

EU Trade Commissioner Peter Mandelson said after the meeting: "We have moved, moved, and moved again in the last year or so in different parts of the agricultural negotiation…I firmly believe we have a broad landing range in agriculture which is fair and forthcoming to developing countries and takes to the limit what the EU can do…But we cannot negotiate with ourselves. It remained totally unclear from our discussions whether there is a comparable landing range in industrial goods, without which it would not be possible to find a reasonable trade off…While in Europe, we are prepared to pay a lot – and more than others – we cannot do so for next to nothing in return. It emerged from the discussion on NAMA (non-agricultural market access) that we would not be able to point to any substantive or commercially meaningful changes in the tariffs of the emerging economies." 

"It is not the end of the Doha Round," he added, but conceded: "It places a very major question mark on the ability of the wider WTO membership to complete this round." 

EU Agriculture Commissioner Mariann Fischer Boel  said: "We of course hope that the Geneva Process can do better, but frankly I am not optimistic." She added: "This is a great disappointment. It's a bad day for the multilateral system…Europe was prepared to cut our average farm tariffs by more than half…Some believe that these opportunities can be recuperated through bilateral deals. I have to disappoint them. They are wrong. The EU will never be able to offer anything at the bilateral level of the order we were prepared to do at the multilateral level." 

US Agriculture Secretary Mike Johanns blamed Brazilian Foreign Minister Celso Amorim and Indian Commerce Minister Kamal Nath, saying they "didn't move an iota from the point we started at two years ago". "We stretched and they grabbed. I could have done cartwheels off the roof of this building and I'm still not sure I would have got a response," he told journalists. 

But Amorim and Nath said that the talks had derailed because of US and EU refusal to improve their farm aid offers. 

"Whatever the version others may try to offer, the major divergences appeared in agriculture…It was useless to continue the discussion based on the numbers on the table," said Brazilian Foreign Minister Celso Amorim. 

Indian Commerce Minister Kamal Nath explained that the US had offered to cap its overall spending on trade-distorting domestic support for agricultural production at $17 billion even though it currently spends only $10.8 billion. This would represent a 50% increase, he said, adding: "There is no equity in this, no logic and no fairness." 

"If this is to be called a development round, we need to correct the flaws in terms of subsidies," he stressed. 

US Trade Representative Susan Schwab has said that the US could shave off more subsidies, but only if advanced developing nations and the EU open their markets to more American farm products. While she acknowledged that the EU had "showed this week it was ready to stretch", she questioned whether Nath and Amorim were even prepared to negotiate, pointing to the "rigidity" of their position. 

The 'Group of 90' developing countries, which includes and Least Developed Countries (LDCs) and other African, Caribbean and Pacific States (ACP), raised concerns about the secrecy surrounding the negotiations, complaining that their key concerns are being ignored. "The recent WTO negotiating process has been less than transparent and participatory," they protested, adding that Brazil and India "cannot be expected to carry the responsibility of representing the views of all developing countries" and that the system should not be used to legitimate decisions reached by a handful of countries. 

A number of development NGOs took advantage of the situation to call for an end to the negotiations. Peter Hardstaff, head of policy at the World Development Movement, said: "The fact that the Doha Round is on its last legs is welcome. We can only hope someone will see sense and finally kill it off." 

Aftab Alam Khan, head of the London-based ActionAid's Trade Justice Campaign, said: "We are not expecting any development outcomes in the current negotiations. It is now time to review the global trading rules in favour of poor countries."