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Talks go on all night to avert failure

The Standard: China's Business Newspaper
December 17, 2005
By Mark Lee, Zach Coleman and Kevin Rafferty
As another day at the World Trade Organization talks finished with little apparent progress or signs that countries have narrowed their differences over fundamental issues, negotiators have turned their minds to further high-level meetings after the conference in Hong Kong comes to a close Sunday.

Nonetheless, ministers began an all- night series of talks that were likely to last until at least dawn today in an effort to prevent the Hong Kong conclave from ending in total failure. A deadline of 6am was set for submission of new texts that might allow limited progress on a few smaller issues. The conference has thus turned into a complicated game of who would blink first, amid the growing danger that nobody will.

Echoing earlier calls made by US trade representative Rob Portman to hold another meeting in the first quarter next year, South African Minister of Trade and Industry Mandisi Mpahlwa proposed that quarterly or half-yearly ministerial meetings should be convened next year up to the end of December, when the present Doha round of negotiations is due to finish.

"[Holding extra meetings] is something this conference needs to take a look at. The credibility of the WTO is at stake," Mpahlwa said.

A draft agreement based on progress achieved this week is to be circulated among WTO members Saturday for final negotiations, which must finish Sunday, said WTO spokesman Keith Rockwell. However, the draft is expected to contain little more than proposals to grant duty-free, quota-free access to the 32 LDCs.

When the WTO member countries convened for the start of the conference this week, there were hopes of a deal that would result in lower tariffs for farm and industrial products, and an end to export subsidies in farm products.

If anything, however, the talks had been "going backwards," European Union trade commissioner Peter Mandelson said Friday, referring to a proposal by the G90 group of developing countries to roll back talks on liberalization of service industries, the area of most interest to Hong Kong.

But the question of services, where there is a text, is stuck because of the desire of some countries for a stronger deal while the developing countries want the proposals to be loosened.

The G90 group, which is made up of 90 developing countries in Africa, the Caribbean and Asia including the 32 least developed countries, has found the current Doha provisions on services "too prescriptive and demanding," Rockwell said.

The Hong Kong Coalition of Service Industries, a local industry body, was among several service industry organizations to sign a letter to urge the WTO to reject the G90 proposal.

Despite unveiling the new alliance with the G90 group to demand more progress in agricultural reforms, the G20 group of more advanced developing countries, which includes China and Brazil, said its members don't support the G90 proposal. "It is not part of our common platform," Brazilian Minister of External Affairs Celso Amorim said. The rationale of the alliance with the G90 group, Amorim said, is to ensure "we get a trade round that helps the world as a whole and maintains a development agenda."

The new alliance, dubbed the G110, will add to more pressure for richer countries such as the United States and the European member states as well as Japan to finalize the duty-free, quota- free package for the 32 least developed countries by the end of this week.

Separately, 11 developing member countries including China, Brazil and the Philippines formed the NAMA 11 to resist demands from richer industrial countries to open their markets for industrial goods.

Richer countries such as the EU member states and the United States want increased access for their industrial goods to the domestic markets of developing countries like Brazil and India, which in turn demand that the EU and the United States cut their agricultural subsidies, which boost the competitiveness of EU and US farmers at the expense of their counterparts in developing countries.

A clearly downbeat Portman echoed the mood of the conference Thursday when he warned that failure to reach agreement on a new trade round would "call into question not just the purpose of the WTO but the post-war consensus for liberalization and more open markets."


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