US farm groups lukewarm on Davos WTO plan

US farm groups today gave a cool reception to comments from trade ministers at an international forum that an ambitious global trade deal can still be struck.

Some lobbyists said a meeting of world leaders might be the only way to revive the current round of trade talks.

Trade ministers from around the world, meeting in the Swiss mountain resort of Davos, said on the weekend there was a new sense that progress had to be made on all outstanding issues relating to the so-called Doha round of talks, which aims to help poor nations out of poverty by lowering trade barriers.

Agriculture has long been the main stumbling block to progress, with rich nations struggling to agree on formulas for cutting farm tariffs and duties. At the weekend ministers agreed to work also on services and manufacturing proposals in tandemwith agriculture.

"They focused on what they could do and again didn't get to the meat of the issues. They've come up with this programme on working timelines, but so long as people are just defending their proposals ... you wonder how constructive that can be," said Dave Salmonsen, senior director for Congressional relations at the American Farm Bureau Federation.

"If the negotiators can't do it and the trade ministers can't get it done, does it take the political leaders? They've tried everything else. Maybe this is what it takes," said Salmonsen, who represents America's largest farm group.

The United States, Europe and Brazil have swapped blame for the deadlock after the World Trade Organisation's ministerial meeting in Hong Kong in December failed to yield anything but an agreement on scrapping farm export subsidies by 2013.

For the rest of the agriculture agreement a deadline of April 30 was set, and underscored at the Davos meeting.

"The results from Davos can be considered progress given that a select group of ministers only had a three-hour meeting. But I question whether there is sufficient will from other countries to provide ambitious proposals in time for the April 30 deadline," said Audrae Erickson, president of the Corn Refiners Association and co-chair of the AgTrade coalition of US farm groups.

At least the more detailed schedule should help WTO member countries realise that time is pressing, Erickson added.

Looming over the WTO talks is the mid-2007 expiry of the Bush administration's trade promotion authority, which means any trade deal must be approved or rejected by Congress without any changes. When it expires Congress could insist on tinkering with any pacts, making changes that would unravel a deal.

"Acknowledging that there's a hard deadline is important. It's absolutely necessary as part of the mindset to get this done," said Jim Grueff, a former US agriculture negotiator.

"The more they say this has to get done, the more politically embarrassing it will be if it doesn't get done." Representatives from US manufacturing and services said they expected negotiations to pick up steam now but said agriculture -- and an improved offer from Brussels -- was still at the heart of the process.

"I think a very important thing happened. There was agreement that we shouldn't be negotiating only on agriculture," said Frank Vargo, vice president for international economic affairs at the National Association of Manufacturers.

"I think this is more doable now ... I'm looking forward to much faster movement ... but I certainly understand everything will still be contingent on agriculture," he said.

Even if countries agreed in Davos to focus more on services and industrial goods, "What's needed is a breakthrough on agriculture. Everything else is secondary to that," said Bob Vastine, president of the Coalition of Service Industries.

"If the Europeans were to break the logjam, things would open up quite nicely" because everybody knows the trade-offs that are needed to reach a final deal, Vastine said.

- REUTERS