Plan aims to resume WTO talks

Ministers endorse strategy seen as unusual in trade negotiations

January 28, 2007|By New York Times News Service

DAVOS, Switzerland -- Leading trade ministers embraced an unusual game plan yesterday for reviving trade talks, saying they would try to hash out details on technical issues first, rather than agreeing on the broad outlines of an accord before negotiations resume.

During a meeting at the World Economic Forum, officials from the United States, the European Union and emerging markets like India and Brazil vowed to move forward again in the Doha round of World Trade Organization talks, which began more than five years ago in the Persian Gulf emirate of Qatar but collapsed last July because of disagreements about farm subsidies and tariff cuts.

To resuscitate the talks, the ministers endorsed a strategy that is highly unusual in these negotiations but now appears to offer the only chance to conclude the trade round. Instead of creating the broad outlines of an agreement and then working out details on technical issues such as tariffs and subsidies later, countries will work out most specifics first. Then they will decide whether a final push is warranted at a meeting of all World Trade Organization members.

Pascal Lamy, the organization's director-general, said the process would have to achieve a genuine breakthrough in "months, not quarters," for a meeting of all the group's members to occur. It would also have to address tariff cuts for industrial products and services like finance and telecommunications.

Lamy said that countries remained divided over several issues, including simplifying customs procedures, and environmental and anti-dumping rules. If a breakthrough does occur, a final agreement could come within eight months, he said.

The WTO negotiations would dovetail with a bid by the Bush administration to extend the U.S. trade negotiating authority that expires June 30. This week, President Bush will give two major addresses on economic policy calling on Congress to take this step, U.S. officials said.

U.S. Trade Representative Susan C. Schwab said the legislation, known as "trade promotion authority" because it paves the way for a vote on trade deals in Congress, would begin in earnest only after the outlines of a deal emerge.

"What could be an amorphous debate about TPA would become a focused debate about whether the United States is going to embrace a multilateral agreement that our trading partners are ready to embrace," Schwab said.

Rep. Barney Frank of Massachusetts warned that Democrats, now a majority in Congress, were determined to extract a price for any new bill that included labor and environmental rules in trade pacts, as well as measures that address "inequality in America," such as the right to join unions, health care and "a few other things."

"In the current situation, I do not think it would pass, and Doha will not pass," Frank, the chairman of the House financial services committee, said in Davos. "But we're ready to make a bargain."

Meanwhile, trade officials in Davos said they were optimistic that the approach would resuscitate trade negotiations. They contrasted recent talks with negotiations over the summer.

"This meeting was very different - in a good way," Schwab said in an interview after the meeting in Davos.

Peter Mandelson, the European trade commissioner, expressed the widely held sentiment that political will exists for another attempt at success before the Doha round is abandoned entirely.

"The alternative is not a better outcome, but no outcome," Mandelson told the meeting.

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