Don't let trade talks collapse says Wolfowitz

Paul Wolfowitz

WASHINGTON - Global trade talks are about to collapse and leaders of the world's most powerful countries must break the impasse, says World Bank president Paul Wolfowitz.

"With time running out, our collective efforts can make the difference," he said in a letter to leaders of the Group of Eight industrialised countries and five major developing economies, due to start meeting in Russia on Saturday.

The meeting of leaders from the United States, Japan, Germany, Britain, France, Italy, Canada and Russia comes two weeks after trade ministers met in Geneva but failed to resolve differences over farm and industrial goods which, with services, make up the three pillars of the talks.

"We can work to lift millions from poverty, boost developing country income, improve global market access and reduce taxpayer and consumer costs for all, or allow the whole effort to collapse, with harm to everyone," Wolfowitz said.

The meetings end next Monday, when the leaders of China, Brazil, India, South Africa and Mexico, as well as the African Union and international organisations, are scheduled to meet their Group of Eight counterparts - the G8 plus five.

The so-called Doha development round started almost five years ago, with a mandate to lift millions of people out of poverty through freer trade and enhanced global growth.

Poorer nations insist that richer countries must open their agriculture markets before they will open their industrial and services markets.

Wolfowitz called on all sides to make more concessions.

"A collective pledge by the US to reduce agriculture subsidies, by the [European Union] to improve market access and the plus five members to limit tariffs on manufactures ... could help seal a deal," Wolfowitz says.

He said full trade liberalisation could generate US$300 billion ($491 billion) a year in additional production, with developing countries gaining up to US$86 billion, dwarfing annual bilateral assistance efforts.

"The world's poorest people, the 1.2 billion living on less than $US1 a day, are counting on your good intentions being transformed into decisive action," he said.

- REUTERS