PM keen to kickstart stalled world trade talks

By FRAN O'SULLIVAN

PARIS - Prime Minister Helen Clark is trying to use her turn as chairwoman of an OECD Ministerial Council meeting to inject new momentum into stalled world trade talks.

She told the Herald the issue came up during an economic session at the council meeting and she hoped to raise it more strongly during a coming trade session.

The OECD meeting in Paris comes at a time when World Trade Organisation negotiations on the liberalisation of agriculture and services are behind schedule.

Clark said she thought it significant that one contributor on the topic commented: "We can't just leave trade to trade ministers - it's got to come up a level."

In other words, she said, "the point was made that in the end what was happening in that round is affecting whole economies".

"It's not just a trade issue ... it's a whole economic issue."

WTO Director-General Supachai Panitchpakdi, in Paris for the OECD meeting, later confessed the negotiations were a "little bit stalemated".

But Trade Negotiations Minister Jim Sutton accused protectionist countries of trying to recant on what they had agreed to during earlier talks at Doha.

"Deadlines have been missed and this is a very serious issue," he told the forum.

"When Supachai says it has got a little bit stalemated, it's like saying you are a little bit pregnant. You either are or you're not."

Sutton urged trade ministers to focus on the level of ambition set out at Doha. Every WTO member was in accord then, he said earlier, including the European Union - but now the EU's negotiating proposals for agriculture "fall comically short" of those agreed targets.

The closed OECD ministerial meeting is the first one in 20 years that a NZ Prime Minister has led.

Clark indicated yesterday that she would not hesitate to steer OECD ministers to take a strong direction on issues of great importance to New Zealand and the developing world.

To questions at the forum, she said the 1980s-1990s reform pendulum in New Zealand had "swung out too far".

The country's unemployment rate of about 4.9 per cent - half that of many European nations - was largely due to a lack of labour market rigidities, she said, but it was "a question of balance".

NZ used the OECD's work to help benchmark its own performance.