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The key issues WTO must agree upon this week
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The key issues WTO must agree upon this week
World Trade Organization (WTO) states are battling to meet an end of July deadline for a pact to put the Doha Round of free trade talks back on track. Following are some key elements of the round and the proposed deal the WTO’s executive General Council will seek to hammer out this week, starting Tuesday.
The Doha Development Agenda was launched in November 2001 when the world economy was reeling from the impact of the Sept. 11 attacks in the United States. It aims to lower barriers to trade in farm and industrial goods and services, paying special attention to developing country issues. Developing countries say it has failed to live up to the “development” tag and accuse richer states of dragging their feet on commitments to cut agricultural subsidies and open their highly protected farm markets. The round – whose successful conclusion could help lift 500 million people out of poverty, according to the World Bank – was due to finish at the end of 2004. That deadline will be missed.
After failing to reach agreement in Cancun, Mexico, last September on an interim deal on parameters for the negotiations in farm and industrial goods, WTO states set themselves a new deadline of the end of July. The WTO’s General Council, on which the full 147-state membership sits, will consider a blueprint by WTO chief Supachai Panitchpakdi and General Council Chairman Shotaro Oshima of Japan. Here are some key elements of the package:
<B>Agriculture </B>
The text calls for the most trade-distorting forms of domestic support for farmers to be cut substantially, with product-specific capping of spending. The United States wants some easing of the rules, but developing countries and the European Union say that would allow Washington to keep farm spending at current levels.
The text calls for the elimination of farm export subsidies. Brussels is demanding equally tough language to cover US export credit programs and the state trading companies of Australia and Canada. On market access, essentially import barriers, the rich-nation importing countries would be allowed to identify a number of products where they would be able to offer less market access. It leaves the question of developing country “special” products for a later stage. Developing countries have attacked the draft as being too generous to rich nations.
<B>Industrial goods </B>
Developing countries, particularly African, say the text does not meet their concerns, specifically over what happens to their “preferences,” which grant them special access to rich nation markets. Unless these are safeguarded, they fear they will be elbowed out by better-off developing nations able to take advantage of lower tariffs in farm and industrial goods.
<B> Cotton</B>
West African states have dropped a demand that cotton be treated as a separate issue, but have set out tough conditions for allowing it to be included in the overall farm negotiations.
<B>Trade facilitation </B>
The harmonizing of customs’ practices was one of four so-called “Singapore” issues that were the direct cause of the breakdown at Cancun. The other three – including competition and investment policies – have been set aside.
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