Hopes fade for April deal in WTO trade talks

GENEVA – With time fast running out, scepticism is mounting at the World Trade Organisation (WTO) that a deal on farm and industrial goods, crucial to an overall global trade pact, can be struck by the end of April.

Diplomats in Geneva say that the deadline – set by trade ministers last December in Hong Kong – looks unattainable and the big question facing the 149-state body is how to prevent a fresh failure from killing off the negotiations completely. “My view is that we have almost run out of time for April,” said an ambassador from one Latin American country, who declined to be named.”Nobody in Geneva thinks it can be done,” added a senior official from a developed country.WTO Director-General Pascal Lamy has so far insisted that the end of April target must be hit, warning member states as late as last week that missing it would be a huge mistake.But after further talks between a small group of ministers at the weekend in Rio de Janeiro yielded no advance, particularly on agriculture, US Trade Representative Rob Portman admitted that he was pessimistic about April 30.”I am not encouraged.We did not make adequate progress,” he told reporters in Washington.So what are the scenarios? As before Hong Kong, when he advised states to back off from their initial goal of a draft trade deal and go for something less ambitious there and set a later date for an accord, Lamy may opt for a strategic retreat.”There are really two choices.We can downplay it and set another deadline or we can head for a showdown (in April),” said the developed country diplomat.”My sense is that Lamy does not know yet how he wants to play it.”The WTO’s Doha round of free trade negotiations, billed as a “once-in-a-generation” chance to boost global growth and lift millions out of poverty, has lurched from crisis to crisis since being launched in the Qatari capital in late 2001.MOMENT OF TRUTH But no-one doubts its moment of truth is near.By everyone’s reckoning July 2006 is the final, irrevocable deadline not just for a draft deal on farm and industrial goods, but for the whole round, which ranges across market opening in services to special aid-for-trade help for the poorest states.After July, the round either goes into hibernation, perhaps for years, or collapses altogether.This is because there would no longer be enough time to complete remaining work before special US presidential powers to negotiate trade deals, without which multilateral negotiations are impossible, expire in mid-2007.Some trade diplomats favour simply letting everything slip to July when it would become all-or-nothing.”Everyone knows that July is the real deadline,” said another developing country diplomat.Another possibility could be to try and repeat the Hong Kong trick and seek some agreement on minor aspects of the farm and industrial goods’ negotiations, to maintain the illusion of movement, while leaving the tough decisions for later.But for some that could be almost as hard to pull off as a full deal on cutting tariffs and slashing rich nation farm subsidies, which has proved so elusive.In India, where he is on a visit, Lamy seemed to be sticking to the end-April date despite the gloomy mood in Geneva.”We are approaching the moment of truth in the next few weeks,” he said and urged the United States to move more on farm subsidies, the European Union on farm tariffs and developing countries on industrial barriers.Some diplomats said that a crisis at the end of April could open the way for Lamy to step in as a “white knight” to save the round with suggestions for compromise, although he has repeatedly said that that is a role he does not want.-Nampa-Reuters”My view is that we have almost run out of time for April,” said an ambassador from one Latin American country, who declined to be named.”Nobody in Geneva thinks it can be done,” added a senior official from a developed country.WTO Director-General Pascal Lamy has so far insisted that the end of April target must be hit, warning member states as late as last week that missing it would be a huge mistake.But after further talks between a small group of ministers at the weekend in Rio de Janeiro yielded no advance, particularly on agriculture, US Trade Representative Rob Portman admitted that he was pessimistic about April 30.”I am not encouraged.We did not make adequate progress,” he told reporters in Washington.So what are the scenarios? As before Hong Kong, when he advised states to back off from their initial goal of a draft trade deal and go for something less ambitious there and set a later date for an accord, Lamy may opt for a strategic retreat.”There are really two choices.We can downplay it and set another deadline or we can head for a showdown (in April),” said the developed country diplomat.”My sense is that Lamy does not know yet how he wants to play it.”The WTO’s Doha round of free trade negotiations, billed as a “once-in-a-generation” chance to boost global growth and lift millions out of poverty, has lurched from crisis to crisis since being launched in the Qatari capital in late 2001.MOMENT OF TRUTH But no-one doubts its moment of truth is near.By everyone’s reckoning July 2006 is the final, irrevocable deadline not just for a draft deal on farm and industrial goods, but for the whole round, which ranges across market opening in services to special aid-for-trade help for the poorest states.After July, the round either goes into hibernation, perhaps for years, or collapses altogether.This is because there would no longer be enough time to complete remaining work before special US presidential powers to negotiate trade deals, without which multilateral negotiations are impossible, expire in mid-2007.Some trade diplomats favour simply letting everything slip to July when it would become all-or-nothing.”Everyone knows that July is the real deadline,” said another developing country diplomat.Another possibility could be to try and repeat the Hong Kong trick and seek some agreement on minor aspects of the farm and industrial goods’ negotiations, to maintain the illusion of movement, while leaving the tough decisions for later.But for some that could be almost as hard to pull off as a full deal on cutting tariffs and slashing rich nation farm subsidies, which has proved so elusive.In India, where he is on a visit, Lamy seemed to be sticking to the end-April date despite the gloomy mood in Geneva.”We are approaching the moment of truth in the next few weeks,” he said and urged the United States to move more on farm subsidies, the European Union on farm tariffs and developing countries on industrial barriers.Some diplomats said that a crisis at the end of April could open the way for Lamy to step in as a “white knight” to save the round with suggestions for compromise, although he has repeatedly said that that is a role he does not want.-Nampa-Reuters