High tension at WTO trade talks

July 29, 2008 12:00 am

, GENEVA, July 29  – Tension rose sharply as gruelling WTO talks to hammer out a global trade pact ran into a ninth day on Tuesday, with leading nations urging flexibility to avert an "appalling" collapse.

Describing the mood in a morning meeting of ministers, Indonesian Trade Minister Mari Elka Pangestu said there was an understanding that "nobody wants a failure" and that all parties were trying to be constructive.

"More than half felt that while the issues that remain are complex and it seems we’ve never been so far, we’re actually so near because so much has been agreed on," she told reporters.

"We need to go to this last mile, but this last mile is a significant issue," she said.

Ministers are struggling to close differences on subsidies and import tariffs to forge a new deal under the World Trade Organization’s Doha Round, which has repeatedly foundered since it was launched in the Qatari capital seven years ago.

Arriving at the meeting earlier, EU Trade Commissioner Peter Mandelson had assessed that a deal was at hand "considering what is at stake".

He also warned of the consequences of a failure, saying that it would be an "appalling prospect".

He said: "If people want this deal, there’s no better deal coming along and you have to consider if this fails what they would lose."

Mandelson also said that both Washington and New Delhi needed to show flexibility if the whole torturous cycle of negotations were not to end in ignominious failure.

"The compromise has to come from both sides who are involved — it means US and India principally and other developing countries," he said.

"If they don’t demonstrate the will to compromise, then I’m afraid the deal will go down, it’s as an appalling prospect as that," the EU trade chief warned.

Brazil’s Foreign Minister Celso Amorim meanwhile, called for politicians to step up to the challenge and shoulder political responsibility by taking risks.

"Political responsibility is also about taking risks. It’s not about doing what you’re absolutely sure, otherwise we could have computers here instead of negotiators," he said.

"We are at a crucial moment, but we cannot make accusations," Amorim told AFP.

At the heart of the hold-up of progress to negotiations here is an issue called SSM or Special Safeguard Mechanism.

Some developing countries such as India want that mechanism to kick in at a lower rate to protect their farmers, while others want that measure to take effect at a higher rate.

With both sides refusing to give way, acrimony grew on Monday with the US publicly pointing its finger at India and China for holding up progress.

"That’s a real risk because those countries are advocating selectively reopening the package," US Trade Representative Susan Schwab said then.

"There is a real threat to a delicate balance we’ve achieved on Friday night and I’m concerned it will jeopardise the outcome of this round," she added.

For WTO spokesman Keith Rockwell, "the situation is very tense, things are finely balanced and the outcome is by no means certain".

The mood darkened over the weekend, as optimism arising from a breakthrough in negotiations on Friday dimmed.

"For everyone in the EU team there is a sense of being in the endgame," Mandelson wrote in Monday’s edition of his daily blog on the talks.


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