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Hope of deal in world trade talks Hope of deal in world trade talks
(about 7 hours later)
Progress has been made at global trade talks and a deal might be possible, negotiators have said. Progress has been made at global trade talks and a deal looks possible, negotiators have said.
Earlier, the head of the World Trade Organization warned that the long-running Doha round would fail unless a compromise could be reached.Earlier, the head of the World Trade Organization warned that the long-running Doha round would fail unless a compromise could be reached.
EU trade commissioner Peter Mandelson and WTO spokesman Keith Rockwell both said there were encouraging signs. Delegates from the EU, US, Brazil and Australia said signs were encouraging although others were more cautious.
A meeting of the world's biggest trading nations finished "in a spirit of cooperation", Mr Rockwell said. EU trade commissioner Peter Mandelson said that "it was an emerging deal but not a done deal".
The WTO spokesman said that the group of seven will now meet with the wider group of over 35 nations. After four days of deadlock, the compromise emerged from a five-hour meeting of representatives from the US, European Union, Australia, Brazil, India, China and Japan.
"There are very encouraging signs and we will see what the reaction is in the coming hours," he said. It was then reviewed by ministers from some 35 countries.
The situation is critical edging between success and failure WTO boss Pascal Lamy class="" href="/1/hi/business/7517028.stm">Q&A: Crunch trade talks "I think the situation looks strong. I think we can be very hopeful now," said Mr Mandelson said.
Mr Mandelson said progress had been made in most areas but that the group had "not reached a final deal". "What is emerging is a deal that is not perfect, not beautiful, but is good for the global economy and good for development."
Caution
The (proposed) deal threatens disaster for millions as developing country markets are forced open in the interests of corporate profits John Hilary, executive director War on Want Q&A: Crunch trade talks
US Trade Representative Susan Schwab said ministers had reached tentative agreement on the way forward but struck a cautious note.
"I think the biggest concern that we have is that a handful of large emerging markets really threaten this round for the rest of us."
Argentina rejected the proposal drawn up by the countries, saying it "was not acceptable in its current form".
Indian Commerce Minister Kamal Nath, whose tough position has been blamed for the deadlock, said "there are certain areas of concern, certain areas of consensus".
Talks reconvene on Saturday after delegates consult with their capitals.
Proposal
The proposed settlement, brokered by WTO chief Pascal Lamy, calls for cutting limits of European farm subsidies by 80% and US payments by 70% to around $14.5bn.
However, this would not mean the US would have to cut their actual spending on support to farmers, which totalled around $9bn last year.
The compromise proposal also involves cuts in tariffs on agricultural imports and on industrial goods.
However, it would still provide developing countries with some loopholes to protect strategic industries such as automobiles.
Bleak outcome?
John Hilary, executive director of the anti-poverty charity War on Want, said that proposed settlement could lead to "a bleak outcome for the world's poor".
This is the last throw of the dice Peter Mandelson, EU trade commissioner
He said the proposal allowed developed countries to get away with minimal cuts to their farm subsidies, while at the same time opening up developing country markets to both agricultural and industrial imports.
"Stitching together an agreement between seven states while shutting out all others exposes the lack of legitimacy at the heart of the world trade talks," he said.
"The deal threatens disaster for millions as developing country markets are forced open in the interests of corporate profits."
'Last throw of the dice''Last throw of the dice'
Before the meeting of the US, European Union, Australia, Brazil, India, China and Japan, Mr Mandelson called the talks "the last throw of the dice". Before the meeting, Mr Mandelson called the talks "the last throw of the dice".
"Fatigue is setting in and I think people are coming to the conclusion that, if the inflexibility of some is such that we cannot strike a deal now, we're not likely to be able to do so at any time in the near future," Mr Mandelson said."Fatigue is setting in and I think people are coming to the conclusion that, if the inflexibility of some is such that we cannot strike a deal now, we're not likely to be able to do so at any time in the near future," Mr Mandelson said.
Trade ministers from around the world began talks on Monday aimed at saving the Doha round, which began in 2001 and aims to liberalise world trade rules by reducing tariffs on imports and industry subsidies.Trade ministers from around the world began talks on Monday aimed at saving the Doha round, which began in 2001 and aims to liberalise world trade rules by reducing tariffs on imports and industry subsidies.
"The situation is critical edging between success and failure," WTO boss Pascal Lamy said earlier."The situation is critical edging between success and failure," WTO boss Pascal Lamy said earlier.
If negotiators failed to find common ground after this week's meeting, many think the Doha round would be doomed.If negotiators failed to find common ground after this week's meeting, many think the Doha round would be doomed.
African worriesAfrican worries
African nations called on the seven trading powers to deal with issues that concern all 153 members of the WTO rather focus solely on their individual concerns.African nations called on the seven trading powers to deal with issues that concern all 153 members of the WTO rather focus solely on their individual concerns.
"This is not an opportunity for a small group to thrash out issues that are pertinent to them but rather for a small group to help the world move forward," Kenya's deputy prime minister and commerce minister Uhuru Kenyatta said. "This is not an opportunity for a small group to thrash out issues that are pertinent to them but rather for a small group to help the world move forward," Kenya's Deputy Prime Minister and Commerce Minister Uhuru Kenyatta said.
Developing countries like Brazil and India say the US and EU are failing to offer big enough cuts in subsidies and import tariffs, particularly in agriculture.Developing countries like Brazil and India say the US and EU are failing to offer big enough cuts in subsidies and import tariffs, particularly in agriculture.
However, Washington and Brussels both say they have ceded ground and want emerging economies to further open their markets to imports of manufactured goods and services.However, Washington and Brussels both say they have ceded ground and want emerging economies to further open their markets to imports of manufactured goods and services.
But it is not clear that any pledges made by the Bush administration at these talks would be honoured by the new US President who will be elected in November - especially if the Democratic candidate, Barrack Obama, wins. But it is not clear that any pledges made by the Bush administration at these talks would be honoured by the new US president who will be elected in November - especially if the Democratic candidate, Barack Obama, wins.