Agriculture main sticking point at WTO talks

By BRIAN FALLOW

The call for the elimination of agricultural export subsidies has emerged as a make-or-break issue as trade ministers try to thrash out an agenda for a new round of world trade negotiations.

Talks in the Gulf city of Doha have split into six sets of sub-negotiations on the most contentious areas.

Agriculture is one.

Singaporean Trade Minister George Yeo, who has no farmers of his own to answer to, has the task of trying to arrive at a form of words that all 142 World Trade Organisation members can go along with.

The draft text put up by the WTO secretariat talks of "reduction of, with a view to phasing out, all forms of export subsidies".

This is supported by the Cairns Group of agricultural exporting countries (including New Zealand) and the United States. Even Japan has indicated it can live with that language.

But the European Union has rejected any talk of "elimination" or "phasing out".

New Zealand Trade Minister Jim Sutton said the issue could go down to the wire.

When he arrived at the talks he thought the chances of a successful outcome were 70-30, but it was now neck-and-neck.

The Doha talks are due to conclude tonight.

Trade Liberalisation Network executive director Stephen Jacobi, one of four outside advisers to the New Zealand delegation, said yesterday that while the sub-negotiations were going on it was hard to get a clear overall sense of how the talks were going.

"But the mood is more optimistic than it was, I understand, in Seattle [where the last bid to launch a new trade round failed nearly two years ago]."

Mr Jacobi said WTO Director-General Mike Moore had been stressing that Doha was about finding a basis on which negotiations could start, not concluding them.

Apart from agriculture, the vexed issues are:

* Intellectual property rights and affordable access to medicines.

WTO rules allow parallel importing and other measures to reduce drug costs during public health crises. Drug companies do not like this and developing countries, especially those where HIV/Aids is rife, want reassurance that they can use these provisions without fear of action under the WTO disputes process.

* Environmental issues.

Developing countries are concerned that any enhanced role for the WTO in international environmental matters could prove a source of back-door protectionism.

Similar concerns about trade and labour have meant New Zealand has got nowhere at Doha in trying to get labour standards and trade linked in any declaration from the meeting.

* Investment and competition policy.

The Europeans are keen to see the WTO work on a framework of rules governing investment and competition policy. Countries which have little or nothing in the way of competition law are not sure that would be a good idea.

* Rules, especially concerning dumping and subsidies.

There are concerns that existing anti-dumping rules are being over-used for protectionist purposes. New Zealand would like to see progress on eliminating fishing subsidies.

* Implementation of the Uruguay Round.

Some developing countries consider they have not got all they thought they would from the last trade round. Indian Prime Minister Atal Bihari Vajpayee, in a speech to the United Nations General Assembly at the weekend, said there would be no more bank cheques to the WTO until earlier ones (from the Uruguay Round) had been cashed.