WTO talks on global free trade deal collapse

Seetha & Agencies
New Delhi/Geneva: Last-ditch talks to save the WTO’s Doha Round collapsed on Monday. But there were indications that the process may resume after the US congressional elections in October.

Ministers from the US, the EU, Brazil, India, Australia, and Japan remained deadlocked, prompting DG Pascal Lamy to suspend the five-year-old talks to dismantle market barriers.

The 14 hours of negotiations saw the US dig in its heels on reducing farm subsidies. Actual farm subsidies in the US are currently at $19.6 billion but are bound at $48 billion (the ceiling). The EU and developing countries wanted the actual subsidies to come down to $12 billion.

But all the US was willing to concede was a 46.8 per cent cut in the bound subsidies, which would have brought down the ceiling to $22.5 billion.

In return, it wanted the EU to cut agricultural tariffs by 70 per cent and the developing countries to give up their demand to reserve 20 per cent of tariff lines (products) as special products that would invite no or lesser tariff reduction commitments.

“The US was unwilling to accept the flexibility shown by others,” EU Trade Commissioner Peter Mandelson said.