Nations squabble over trade talks

HONG KONG - World trade talks tipped into disarray yesterday as rich nations exchanged accusations over protected farm markets and struggled even to agree on measures to help the world's poorest.

"It is hard to see where progress can be achieved if the talks continue in their present direction," European Union Trade Commissioner Peter Mandelson said.

"The level of ambition, if anything, is going backwards," he told a news conference on the fourth day of World Trade Organisation (WTO) talks in Hong Kong.

Although there were still two days of negotiations left, officials said the absence of progress augured badly for a long-elusive pact freeing up global business in farm and industrial goods.

Supporters say it promises to inject billions of dollars into the world economy and lift millions out of poverty, but detractors say it would mean more profits for rich nations and companies at the expense of poorer countries.

"A lot of senior officials have had a little bit of sleep and there are folks getting grumpy. Right now I think you are seeing more posturing than you are seeing substance," a senior US trade official said.

Earlier New Zealand's Trade Negotiations Minister Jim Sutton hit back at Mr Mandelson's diversionary tactics after the EU bureaucrat took aim at alleged export monopolies.

Mr Mandelson said he was sick of nations such as Canada, Australia and New Zealand being sanctimonious about export subsidies used by the EU.

The EU wants exporters such as Fonterra, as well as the Australian wheat company AWB and the Canadian Wheat Board, out of business because as "monopolies" they are not transparent.

Mr Sutton indicated the attack was basically a tit-for-tat affair in response to his own sustained pressure on Europe to increase its offer to dismantle agriculture protections.