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Harsh words threaten WTO deal

Latest update : 2008-07-28

After negotiators tried to bridge gaps over the weekend, new cracks appeared when global trade talks entered their second week in Geneva. The US accused China and India of blocking an agreement, while France rejected the deal currently on offer.

Read our analysis of the Doha talks


Tension heightened at the WTO as the United States, China and India accused each other of destroying the chances of an agreement and France refused to sign a proposed deal offered on day eight of grueling global trade talks.


These big trading nations exchanged harsh words at a morning meeting, while other key players sought to calm nerves, saying that a deal was too close at hand to throw away the past week's hard-earned gains.


But France warned from Paris that it would not sign up to proposals for a deal as they stood because they showed no progress on "essential" matters. According to a diplomatic source quoted by AFP, French President Nicolas Sarkozy, who holds the rotating European Union presidency, called European Commission José Manuel Barroso at the weekend to complain about the proposed WTO deal. He reportedly asked European Trade Commissioner Peter Mandelson to travel to Paris to report on the state of the negotiations, but Mandelson refused.


Proposed deal “not acceptable” for France


“The project currently on the table is not acceptable as it stands, to the extent that it shows no advance on elements which are altogether essential in our eyes," government spokesman Luc Chatel said after a cabinet meeting. He mentioned "the protection of indications of geographical origin", in a reference to such issues as the labelling of wine, and "the defence of our European industrial interests in the face of emerging countries".


Negotiators have been trying to find an agreement based on proposals put forward by WTO Director General Pascal Lamy on Friday. A majority of key trading nations accepted the so-called Lamy text, but India expressed reservations. Several emerging countries followed suit, arguing that it threatened their industrial sector (Argentina) or their agriculture (Indonesia, Philippines, Turkey).


According to FRANCE 24’s business journalist Raphale Kahane, the recent differences are “just a repeat” of the divergences that have weighed down the Doha round of trade negotiations for the past seven years. “Developed countries asked developing countries such as the fastest growing economies of China, India and Brazil to lower their tariffs on agricultural products. Emerging countries in return demanded that developed countries cut their agricultural subsidies, which they saw as unfair competitive advantages,” he said.


Although some progress was made on sticking points such as controversial tariffs on bananas, he added: “A dozen unresolved issues still remain on the table.”


China joins forces with India


On Saturday, China joined forces with India when it refused to lower tariffs on rice, cotton and sugar to protect its domestic industries.


In a meeting with all 153 member states Monday morning, the United States accused India and China of threatening to shatter the prospect of a deal.


"All their invocations of development during the past years ring hollow when these major players threaten the development benefits already on the table that are absolutely vital to the vast majority of the membership," the US deputy head at the Geneva mission to the WTO, David Shark, said.


The accusations were met with sharp retort from the Chinese, as said by diplomats attending the meeting.


India's Commerce Minister Kamal Nath also bluntly rebutted the US charge. "We are not holding up the talks," he told AFP on the sidelines of Monday morning's meeting. "Who's holding up this round I think are the large developed countries... who are looking for commercial interests and enhancing prosperity rather than looking for content which reduces poverty."

Date created : 2008-07-28