Last-ditch talks to salvage a deal in the seven-year Doha round of global trade negotiations broke down dramatically in Geneva on Tuesday night, after India, China and the United States fell out over measures to protect poor farmers.
As recriminations began, the head of World Trade Organisation (WTO) Pascal Lamy warned that the wrangling among the organisation’s leading members had allowed a package worth more than $130-billion (about R973-billion) a year in tariff savings to “slip through their fingers”.
Clinching a deal would have provided a powerful vote of confidence in globalisation from the WTO’s 153 members, in the face of the world economic slowdown.
But after nine gruelling days, Lamy was forced to accept that the US, China and India were still too far apart for a deal.
Negotiators from the major trading blocs were already blaming each other for the failure. Brazilian foreign minister Celso Amorim suggested particular individuals within the G7 were responsible for the failure.
“If I were the coach, I would replace the players and see if a different result was possible.”
The US trade representative, Susan Schwab, said it was “unconscionable” that developing countries were insisting on shielding their farmers.
“In the face of the food price crisis, it’s ironic that the debate came down to how much and how fast nations could raise their barriers to imports of food.”
Kamal Nath, India’s trade minister, said he was representing the position of all the G33 members, who were “concerned about the livelihood of poor and subsistence farmers”, and said he hoped the talks could eventually be revived.
EU trade commissioner Peter Mandelson said it was “heart-breaking” that the talks had failed because of a “small gap in numbers” over when protection for farmers could be triggered.
“But I’m afraid that on this subject, an irresistible force met an immovable object and the rest is history.”
The talks came perilously close to collapse last Friday, but limped into a second week after Lamy tabled a draft agreement and exhorted ministers to keep talking.
But a war of words broke out between the US and key developing countries on Monday and the atmosphere remained sour.
The US objected to the details of a “special safeguard mechanism”, designed to protect farmers in the developing world against temporary surges in cut-price imports of cotton and rice.
Tuesday morning, trade officials scrambled to draw up a compromise that would satisfy both sides. But the US insisted the issue was a matter of principle.
“We’re committed to not going backwards,” a US source said.
Mandelson had come under intense political pressure over promised reforms to Europe’s lavish common agricultural policy.
France’s President Nicolas Sarkozy had demanded an immediate meeting with Mandelson, and rallied a cohort of other countries including Italy and Greece to say they might reject the deal in its current form.
Failure of the Geneva talks is a severe personal blow to Lamy, himself a former EU trade commissioner, who had staked his reputation on securing agreement.
Lamy said he had spent 60 hours trying to reconcile the Indian and American positions. —