Trade Talks Not Close to a Deal after Long Effort; Developing Nations Don't Bend

Article excerpt


GENEVA -- The political determination of the world's emerging economic powers not to bend to the demands of the United States featured prominently in the latest setback in the beleaguered Doha round of global trade talks.

Pascal Lamy, director-general of the World Trade Organization, abandoned efforts on Friday to call trade ministers to Geneva to attempt a breakthrough deal by the end of the year, saying such a move would be running an unacceptably high risk of failure.

The bad news for the global economy is that it will not get an injection of confidence from the trade front at a time when the World Bank projects international trade volume will shrink 2.1 percent next year - the first decline since 1982.

The latest stalemate in the seven-year talks comes less than one month after leaders of 20 major economies met in Washington to grapple with the global economic crisis. Trade ministers there were urged to strive for a deal by the end of the year, and their failure does not augur well for a deal being brokered in the early days of a new Obama administration, trade diplomats say.

There's a big gap between the desire of political leaders for a deal and the economic realities on the ground, one WTO trade ambassador said last week.

Endless hours of high-level diplomacy by Mr. Lamy, which included conference calls with U.S. Trade Representative Susan C. Schwab and her counterparts from India and China - Kamal Nath and Chen Deming, respectively -failed to bridge differences over how to sweep away trade barriers in agriculture and industrial goods.

Due to numerous outstanding issues voiced by several WTO members, it became apparent that the gaps were too large to bridge at this time. There were several significant unresolved issues on the table that needed to be addressed for a deal ... to come together, Ms Schwab said.

The bitter discord between the U.S. and the emerging powers of China, India and Brazil centered on demands by Washington to slash duties more aggressively on industrial goods, including chemicals. …