EU Trade Chief Says Talks in Jeopardy

from Yahoo Business

EU Trade Chief Says Dispute Over Industrial Goods Could Sink Global Trade Deal

BRUSSELS, Belgium (AP) -- India, Brazil, South Africa and other emerging economic powers were put under pressure by European Union trade chief Peter Mandelson on Monday to compromise on opening up their manufacturing markets in world trade talks.

The EU's trade commissioner said the countries were risking a failure of ongoing negotiations at the World Trade Organization in Geneva.

"On industrial tariffs, the negotiation is now in danger of going wrong," Mandelson told lawmakers at the European Parliament. "Emerging countries have to exercise responsibility commensurate with their importance and relative strength compared to the poorest. To some extent, they now hold the key to a conclusion of the talks."

A large group of developing nations, which also include Argentina, Indonesia, the Philippines and Venezuela said last month they were seeking new exceptions for the manufacturing products that make up the vast majority of goods traded internationally.

Mandelson said such a position would put them in a position where they "will end up making next to no contribution to new trade flows" in the new trade round.

"That is simply not acceptable," Mandelson said. "Not just for the EU, but because this would negate any gains" for trade between poor nations.

He added that demands made to the emerging economic powers "are modest and proportionate" in cutting industrial tariffs under current trade proposals.

The United States has also criticized Brazil and others for refusing to open up their manufacturing markets, warning that could spell failure of the six-year WTO round to liberalize world commerce.

In September, the US said it would accept a WTO proposal to limit its trade-distorting farm subsidies to a range between $13 billion and US$16.4 billion if emerging economies do more to free up trade in manufacturing goods.

The global trade talks known as the Doha round aim to add billions of dollars to the world economy and lift millions of people out of poverty through free trade. But they have repeatedly stalled since their inception in Qatar's capital in 2001, largely because of wrangling between rich and poor nations over eliminating barriers to farm trade and, more recently, manufacturing trade.