Frictions set clock against traders

By Brian Fallow

A week before the start of the Seattle meeting to launch the millennium round of world trade negotiations, wide gaps remain in key areas.

Officials meeting in Geneva are trying to hammer out a draft declaration for their trade ministers to sign at the World Trade Organisation meeting in Seattle, which would set the agenda for the coming millennium round.

But friction over agriculture and other issues has called into question whether a draft agreement will be reached. The big question is whether there will be one at all.

The director of Auckland University's Apec Study Centre, Robert Scollay, said that if there were fundamental disagreements over a draft declaration, it was hard to see how they could be resolved in Seattle given that 132 member states have only four days of meetings.

The key was to get a draft declaration that was sufficiently consensual and at the same time had enough detail in it to allow things to move forward.

"If the declaration includes agreement on a reasonably detailed level then the negotiations may proceed quite quickly. If not, there will be much more of a preparatory phase next year and the hard negotiations may not start until later in the year or even the following year."

Agriculture and services are automatically on the agenda for the coming negotiating round - that was agreed at the previous Uruguay round. The United States and the Cairns Group of agricultural exporters, including New Zealand, have export subsidies in their sights and they have the weight of Apec behind them.

But the Europeans, who are the main users of export subsidies, want farm trade talks to include issues such as animal welfare and food safety. The suspicion is that these concerns will engender new forms of protectionism, or that at the least they will complicate negotiations to the point that the desired three-year timetable for an outcome will be unachievable.

An acceptable agreement will have to find a form of words which recognises agricultural exporters' concerns about trade-distorting domestic farm support programmes.

A clear theme runs through other contentious topics such as anti-dumping mechanisms, labour standards, intellectual property protection and rules on investment and competition: developing countries seem them as barriers developed countries are using to protect themselves.

The millennium round is meant to give developing countries a better deal than they have received in earlier rounds, as Mike Moore, the WTO's new director-general has frequently stressed. But the way things are going, they are starting from way behind.