The United States warned trading partners yesterday that the world would slip back into protectionism without progress in global talks to reform world commerce, stunting economic growth and hitting the poor.

US Trade Representative Rob Portman, speaking on the second day of a World Trade Organisation (WTO) conference in Hong Kong, called in particular on the European Union to agree on a ?global formula? for opening government-protected agricultural markets. ?I believe either we move forward or we risk moving backward toward protectionism that will stunt economic growth and harm the developing world most,? Portman told the conference.

A group of about 100 anti-globalisation protesters gathered peacefully in a downtown park near the convention centre on yesterday, shouting slogans and waving signs that read ?No to privatisation of services?. They then split up and marched to the US and EU consulates. Some carried huge puppets, including effigies of Uncle Sam and Japanese Prime Minister Junichiro Koizumi. They left peacefully after delivering petition letters.

Rich nations ?Privilege?

More than 50 South Korean farmers and activists clashed with police on Tuesday as the talks began. Police used truncheons and pepper spray to force them back as they charged towards the conference hall. Nine people were hurt, including two policemen. With little prospect of a Hong Kong breakthrough in their row over market access for farm goods, the 149 WTO member states have focused on wrapping up a trade support package for poor nations.

The fear is that there could be a repeat of the last WTO ministerial meeting two years ago in Cancun, Mexico, when developing countries brought the talks to an abrupt halt before negotiations on agriculture could even begin in earnest.

Negotiators worked into the night on Tuesday on details of a possible deal on duty and quota-free access for goods from developing countries. Portman announced that Washington would double aid-for-trade grants to developing countries to $2.7 billion per year by 2010.

That followed a pledge last week from Japan to provide $10 billion to help poor nations with infrastructure to bolster their ability to export and an agreement by EU states to raise spending on trade-related aid to 1 billion euros ($1.2 billion) a year.

?Remnants of feudalism?

EU Trade Commissioner Peter Mandelson, apparently keen to take the spotlight off Europe?s resistance to further cuts in import tariffs on farm goods, stressed the importance of development in the so-called Doha trade round. ?We will not succeed ... if we continue to focus on only one part of the round,? he said. ?This is a development round.?

But Portman said there was only one way to break the WTO?s deadlock, and that was a ?convergence on reducing tariffs in the relatively protected agricultural sector?. ?I join other countries in the developed and the developing world in calling for our trading partners in Europe and elsewhere to agree to a global formula that truly meets the ... requirement of substantial improvement in market access,? he said. He added that the WTO should set a date in Hong Kong to end export subsidies for farm goods. The EU, the biggest user of such subsidies, has already agreed they should go as part of a package to reform world farm trade, but no timetable has been set.

The EU says it can give no further ground on agricultural imports without further offers of access to the markets for manufactured goods and services in developing countries.

But Brazil, which has spearheaded developing countries? drive to win more acces for their farm goods, slammed the ?remnants of feudalism? and ?unacceptable privilege? of rich nations. ?Rich countries cannot expect to receive payment for what they should have done anyway long ago,? Foreign Minister Celso Amorim said. ?Poor countries cannot wait for another 20 years to see true reform in agricultural trade. The time to act is now.?

Tension also simmered in Hong Kong between the EU and the United States over food aid, a contentious part of farm exports. The EU accuses Washington of using the food it buys from farmers to give away as aid as a form of agricultural subsidy.

It was incensed at a UN advertisement in the Financial Times which said restrictions on donations of food to the United Nations could take food out of the mouths of hungry children. Mandelson wrote in a letter to the daily on yesterday that the advertisement was ?a cynical insult to the integrity of all World Trade Organisation members?.

Doug PALMER John RUWITCH