Missed deadline endangers WTO talks

THERE was relief for EU farmers this week, as world trade negotiators gave up hope of meeting a deadline of April 30 for progress in liberalising trade in farm and industrial goods.

The setback lengthens the odds against a deal which would have cut by more than half the barriers which keep much cheaper farm produce out of the EU.

Such a deal would have opened the EU borders to unlimited beef imports at prices considerably below prevailing prices for Irish or EU product, according to Irish beef processors.

If negotiators miss a new end of July deadline it would become almost impossible for them to complete all the technical work required to draw up a world trade agreement, before US negotiating authority ends in mid-2007.

This authority, which forces Congress to accept or reject a trade bill without introducing amendments, is thought to be essential for trade talks success.

Now there are signs that the US is giving up hopes of a deal, having pulled Rob Portman out of the trade representative job after less than a year in the office.

The Bush administration had pushed hard for trade liberalisation, but American politicians are once again turning protectionist, and many observers believe that talk of removing agricultural protection would prove too unpopular ahead of mid-term elections in the US this year.

In the EU, Trade Commissioner Peter Mandelson has failed to win the backing of member states like France and Ireland, committed to protecting their farmers.

Mr Mandelson recently accused the US of demanding further cuts in agricultural subsidies and tariffs, which would make agricultural production impossible to sustain in the EU.

Led by India and Brazil, the G20 group has also held up talks, refusing to negotiate without deeper concessions on agriculture.

July 31 is also the target date to set out in detail how governments would implement a formal trade treaty.

World Trade Organisation chief Pascal Lamy was understandably positive about delays: “We have missed a deadline, but we have no deadlock. I don’t think it’s good news for the round, but I don’t think we should cry over the missed deadline. What we need is more determination and a clearer sense of purpose”.