EU says Australia too close to US in trade talks

CANBERRA - The European Union's trade chief today defended a decision not to attend a summit in Australia designed to revive stalled global trade talks, accusing Canberra of being too close to the United States.

EU Trade Commissioner Peter Mandelson said Australia should take a more balanced approach to the World Trade Organisation (WTO) talks, which collapsed in July after ministers failed to reach an agreement on farm subsidies and market access for agriculture.

"If we had as much messaging to the United States on the farm subsidies as we in Europe hear from Australia on market access in agriculture, then I think Australia's approach will be considered a bit more balanced," Mandelson told Australian Broadcasting Corp. today.

Australian Trade Minister Mark Vaile rejected the criticism, saying Australia had been been an honest broker and was not biased towards any side in the stand-off.

"We have suggested that both the European Union and the US need to move to make compromises to find some common ground so we can get this deal done," Vaile said.

Mandelson has turned down an invitation from Australia to attend the September trade summit in Cairns, designed to mark 20 years of the Cairns Group of 18 agricultural exporting nations.

US Trade Representative Susan Schwab and WTO Director-General Pascal Lamy have said they would attend the Cairns summit.

Vaile has long campaigned for an end to farm subsidies and trade barriers for agriculture, and he had hoped the Cairns meeting would revive the WTO talks, which broke down after five years of negotiations.

Vaile has said both the US and EU had to compromise, but has said the US had made the first move to last year by offering significant cuts to farm subsidies. He has said the EU needed to offer more to cut tariffs for agricultural imports.

The EU and India have said Washington was demanding too high a price for cutting the $20 billion it spends each year on farm subsidies, while Washington said neither India nor the EU had offered enough market access in return for lower subsidies.

Mandelson said Australia had sided with the United States and needed to be more realistic in its approach.

"I think the Australian government, as a close friend and ally of the United States, really has got to show some realism or get the United States to show some realism on farm subsidies," he said.

- REUTERS