WTO farming talks stalled

Negotiations on reducing supports to agriculture as part of the current world trade round are still "miles away from agreement", according to Mr Roderick Abbott, deputy director general of the World Trade Organisation (WTO).

The WTO had set a deadline of next Monday for agreement on reductions in agricultural supports as part of the Doha round of talks. However, this deadline will not be met and there is a need for negotiators to engage more constructively in coming months, ahead of a key ministerial meeting in September in Cancun, Mexico, according to Mr Abbott.

There is a need "to get people to talk to each other, at the moment they are shouting at each other," he said, speaking in Dublin yesterday after briefing business leaders at a seminar organised by IBEC and Forfás.

At the moment the negotiators are far apart, with the US and other big agricultural exporters such as Australia dismissing offers from the EU of subsidy cuts as "too little, too late".

The EU has proposed a 45 per cent cut in export subsidies and a 36 per cent cut in tariffs over six years, reductions that Irish farmers say would severely hit their incomes.

As part of its CAP reform, the European Commission is also recommending a substantial decoupling of farm supports from production.

Mr Abbott said the WTO wanted "to make Cancun a success against a background when it looks like being a failure".

This would require progress in a range of negotiating areas over the coming months, including services, intellectual property protection and dispute settlement procedures, as well as agriculture. A key goal will be to persuade negotiators to "de-link" different areas and refrain from blocking progress in one area to await offers from other parties in others, he said.

Mr Abbott conceded that advancing the agenda before Cancun would not be easy. He said it was too early to say whether the foreign policy divisions that have opened up over Iraq would affect trade and the Doha talks. This could lead to a bad atmosphere in the talks, he conceded but, alternatively, it could lead negotiators to want to solve trade issues to show a determination that the foreign policy tensions would not spill over to other areas.

The deadline for the final completion of the Doha talks is January 2005 and this is the mandate the WTO is working towards, said Mr Abbott. The only way this would change would be if the 145 member countries decided that this time target was no longer realistic.

The Cancun meeting is seen as a key milestone, with the need to make substantial progress if the final deadline is to be made. The WTO remains "determinedly optimistic" about the meeting, Mr Abbott said.

The varying interests of the different parts of the Irish economy in the talks were highlighted by statements from IBEC yesterday. Its director of trade, Mr Brian Callinan, said that Irish negotiators must not adopt a "one-dimensional strategy" of merely defending agriculture to the detriment of all other sectors.

The Government must aim to offset agriculture losses against gains for the wider economy, which would gain from a successful round. He set out priorities for business, which included simplified regulation, reduced customs burdens, liberalised trade in services , the opening up of the maritime sector and new measures to protect property rights.

However, Mr Ciaran Fitzgerald, director of IBEC's food and drink federation, said that the food sector must not be traded off against possible gains in other sectors. He said the deal must ensure full compensation to agricultural producers, while embracing more open trading arrangements.