[WTO Doha Round] Ticking clock could bring WTO deal, Australia says

from Stuff New Zealand

CANBERRA: The pressure of a looming July deadline could help breathe new life into stalled world trade talks, Australia's Trade Minister Mark Vaile said today ahead of crucial talks in Paris next week.

His comments came after Australian Prime Minister John Howard and US President George W Bush agreed to a new diplomatic push to lobby European leaders to clinch a deal from the World Trade Organisation's (WTO) Doha round of trade negotiations.

The trade talks have stumbled, putting the WTO's 149 member states in danger of missing the deadline for a draft agreement on slashing farm subsidies and opening markets for industrial goods and services - but Vaile was optimistic a deal could be struck.

"It's still possible. And this organisation is renowned for making decisions under pressure, and mostly the pressure of time," Vaile told Reuters in an telephone interview.

Vaile, Australia's acting prime minister while Howard is overseas, said he would convene meetings with trade ministers on the sidelines of an OECD meeting in Paris next week to discuss progress on the Doha round.

The WTO talks could collapse after more than four years of negotiations if a draft agreement is not reached by the end of July, an outcome that could undermine the WTO and its ability to settle international trade disputes.

Vaile said that for the Doha round to succeed, the European Union would need to offer more cuts to its highly protected and subsidised agricultural sector, while developing nations such as China, Brazil, India and Egypt needed to offer better market access for manufactured goods.

Australia is a long-term champion of free trade. It argues that trade liberalisation could make the world better off by almost $US300 billion($NZ488.51 billion) and lift 32 million people out of poverty by 2015, with most of the benefits flowing to developing nations.

The EU has offered to cut tariffs on imports of farm goods to just over 12 percent, but wants to designate up to 8 percent of such goods as sensitive, cutting them out of the steepest tariff cuts.

France is leading the push within the EU to resist further cuts in tariffs and farm subsidies, worth $US56.18 billion a year. Vaile said the EU stand would limit the ability of developing nations to compete in world markets.

"The developing world just can't afford to be subsidising their agriculture to that extent," Vaile said. He said a cow in Europe receives an average $US2.20 per day in subsidies, which is more than the income of the world's 1.2 billion poorest people.

Australia's Howard, fresh from talks with Bush and the US cabinet in Washington, told Australian reporters in Chicago on Wednesday that he and Bush agreed to personally lobby European leaders to encourage a breakthrough in the WTO talks.

"We both are of the view that the European Union remains the principle stumbling block," Howard said. "And each of us in different areas will be, on a personal basis, speaking to leaders, encouraging them to do as much as possible to make progress."

While Vaile has campaigned for multilateral trade liberalisation, he has also led Australia's push to sign bilateral deals, with free trade agreements with the United States, New Zealand, Singapore and Thailand.

Australia is also having free trade talks with the 10-member Association of Southeast Asian Nations (Asean), Malaysia, China and the United Arab Emirates.

Vaile said the bilateral deals did not undermine the chances of wider multilateral trade liberalisation, and said the two were complementary.

"We've championed both in recent years," he said, adding that issues such as farm subsidies in the United States or Europe could only be cut though multilateral negotiations.