Trade ministers from around the world opened a fresh quest for consensus on Wednesday on a new pact to boost global commerce, with a possible showdown on cotton trade looming at the end of the day.
Meeting in Hong Kong under the auspices of the World Trade Organisation (WTO), ministers from 149 countries are trying to bridge long-standing gaps on trade in farm products, industrial goods and services.
By all accounts the likelihood of major headway is slim, with the United States and the European Union at loggerheads over trade in farm products and developing countries pressing hard for major cuts in agricultural tariffs.
“There’s a good deal of uncertainty on how this will move forward,” said an Australian trade official who asked not to be named.
He said the goal in Hong Kong is to set out an agenda for further negotiations that should be concluded by mid-2006, allowing a long-awaited multilateral trade-liberalisation accord to come into force by the end of the year.
“It’s going to be very tough, clearly,” he said.
One potentially explosive issue, government support for cotton farmers in rich countries such as the US, is up for discussion late on Wednesday.
“It’s a very sensitive issue and there is a lot of emotion,” the Australian official noted.
West African cotton-producing states, heavily dependent on exports, have complained bitterly about the impact on the global market of generous subsidies offered by Washington to US growers.
Cotton prices are now at a 40-year low, according to the International Monetary Fund, depriving millions of sub-Saharan farmers of a decent income and prompting agitation in West Africa for an end to the US subsidy scheme.
Asked on Tuesday whether Washington would be willing to come to an agreement on cotton here, US Trade Representative Rob Portman said: “In July 2004, we agreed to deal with cotton expeditiously, ambitiously and specifically, within the framework of the agricultural negotiations.
“If we can resolve something this week with regards to cotton, that would be great,” he said, without elaborating.
There are other seemingly intractable disputes as well, notably between the US and the EU on steps to eliminate trade-distorting government support for agriculture and to lower import tariffs on farm goods.
EU officials bristle at repeated suggestions that their offers to reduce tariffs are insufficient and a threat to the outcome of this current round of trade talks, launched in Doha, Qatar, in 2001.
“Our fellow negotiators should be in no doubt that all the European Union’s governments agree there is no reason to move further on agricultural tariffs,” EU trade commissioner Peter Mandelson said in a New York Times column.
“They all agree that the time has come for others to respond in other areas of the Doha agenda, like lowering industrial tariffs and liberalising services, to the moves we have already made.”
Mandelson on Tuesday also sharply criticised the US food-aid programme, seen in some quarters as a disguised way of subsidising US farmers to offload their produce in poor countries.
“Food aid for emergency relief can be a tool to advance development and for humanitarian relief, but the large structured US programme of in-kind food aid is designed in reality to give support to US agricultural producers,” he said.
China, meanwhile, announced that it will make further reductions in import tariffs on more than 100 categories of goods from January 1 to honour its WTO commitments.
Products affected include vegetable oil, raw chemical materials, automobiles and parts, the official Xinhua news agency said.
A report by the US trade representative said on Tuesday that although China has taken steps to repeal or revise more than 1 000 laws and regulations as part of efforts to meet its WTO obligations, the fact that it continues to manage trade remains a problem.
Korean farmers clash with police
On Wednesday, about 20 militant Korean farmers, closely followed by about 150 press photographers, tried to force their way through police lines near the WTO conference.
The protesters managed to tear away several police riot shields before they were forced to retreat by pepper foam and a baton charge.
Several hundred riot police were blocking the main road leading to the Hong Kong Convention and Exhibition Centre.
The Hong Kong media have given blanket coverage to a group of about 1 500 Korean farmers since their arrival in the territory for the WTO talks, and have published numerous stories warning of violence.
Pictures of jostling and pushing between police and farmers near the meeting venue on Tuesday was given front-page and sensationalist headlines on Wednesday.
“Korean war erupts,” said the Oriental Daily News.
“The biggest confrontation since the Hong Kong handover erupted in anti-WTO protest! The originally peaceful atmosphere has been ruined by some of the Korean protesters,” Beijing-backed newspaper Ta Kung Pao said.
Non-governmental groups and the farmers themselves have complained the protesters are being unfairly victimised and demonised. — AFP