Goff still optimistic about WTO trade talks

Phil Goff

The World Trade Organisation's Doha Round trade talks risk collapsing after the main players failed to agree on key issues over the weekend, says Trade Minister Phil Goff.

But some diplomats talked of a "managed crisis" at the WTO talks in Geneva and did not see the current meeting as the moment of truth.

Mr Goff is attending the meeting and said there was disagreement on the appropriate level of tariff cuts to allow market access for agricultural and non-agricultural goods, and the level of cuts proposed for domestic subsidies on agriculture in the United States.

He said time to complete the round was running out but he believed all sides were committed to concluding the talks. "No one is prepared to contemplate the consequences of failure of the round," Mr Goff said.

"It would hugely damage the multilateral trade system. It would deny the development opportunities which the round promises the Third World and prevent the growth in employment and living standards overall which trade liberalisation promotes."

New Zealand would continue to play a constructive role in trying to solve the stalemate, he said.

"Along with others, we have a big stake in a successful outcome from the talks.

"While we want an ambitious outcome in cutting subsidies and trade constraints, we recognise that flexibility as well as political will is essential in achieving an outcome from the round."

In Geneva, US trade representative Susan Schwab said: "We have clearly reached something of an impasse here. But does that mean the round is dead? No. We have no intention of giving up hope."

Calling the meeting neither a "success nor a disaster", European Union trade chief Peter Mandelson said a breakthrough must now come before the end of July.

Heads of government of the so-called G6 - Australia, Brazil, India, Japan, the EU and the United States - which has been taking the lead in negotiations, could soon meet, possibly at the G8 summit this month in St Petersburg.

Without a full trade treaty by the end of 2006, the round faces collapse or hibernation for years, diplomats say. Failure could heighten protectionist pressures.

The United States is resisting pressure to give ground on farm subsidies, which developing countries say prevent them competing on world markets. Talk by the EU that it could be more flexible on farm import tariffs was not enough for a deal.

Developing countries say concessions by the rich WTO states on farm trade are a condition for them to cut industrial tariffs, the other half of a hoped-for bargain in Geneva. But rich state demands on manufacturing were excessive.

- NZPA, REUTERS