Green light for global trade treaty talks

European Union ministers on Friday gave the green light to negotiate a global-trade liberalisation treaty based on a revised text produced on Friday morning, which will force the bloc to abandon all export subsidies on farm goods.

The group gave EU Trade Commissioner Pascal Lamy a mandate to thrash out a deal, on which World Trade Organisation (WTO) negotiators are working frantically to meet an end-of-the-month deadline.

“We have a lot of work to do,” Lamy told reporters after a meeting of ministers on Friday, but he declined to say whether all members had accepted the draft proposal as it stands.

France, the biggest beneficiary of EU farm handouts, has openly criticised Lamy for agreeing to the elimination of all agricultural export subsidies without sufficient commitments from the United States and other big exporting nations that they will end their export support programs.

The new proposal is much more specific in that area, calling for the elimination of all state-run export credit and insurance programmes with repayment terms of more than 180 days, and work to ensure that shorter programmes are run on commercial terms.

It also tackles other issues about which the EU has complained, including state-run exporting boards that are used by Australia, New Zealand and Canada, and whether US food-aid programmes for poor countries are used to get rid of excess agricultural production and prop up prices.

France told other EU ministers on Friday it wants to hold another meeting before the minister decide whether to accept the proposal, but this was opposed by other member states.

“The important thing is to concentrate on the negotiating [at the WTO],” said Arancha Gonzalez. “We need to concentrate on making sure we can agree to a text later this week.”

Lamy agreed earlier this week that it was necessary to match the EU’s offer with movement in other countries.

“If we accept to zero export subsidies, we are making a big step forward,” Lamy said before heading to the WTO talks.

“Zero is terribly precise ... and hence the necessity to match this with an equivalent level of effort by the others.”

Negotiators have only hours left to strike the deal, which will put global trade talks back on track after they collapsed in Cancun, Mexico, last year.

If they fail, the talks likely will be paralysed for months or even years.—Sapa-AP

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