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21 June 2007
Trade Deal Setback Will Not Deter Pursuit of Pact, U.S. Says
U.S. surprised by India, Brazil decision to leave talks on Doha negotiations
Washington -- Despite the collapse of the latest talks among key World Trade Organization (WTO) governments, the United States is not giving up on multilateral trade negotiations, U.S. officials say.
“The United States remains deeply committed to providing leadership to help advance the World Trade Organization and the rules-based multilateral trading system from which we benefit greatly,” said U.S. Trade Representative Susan Schwab and Agriculture Secretary Mike Johanns in a June 21 joint statement.
The two officials said the United States is “deeply disappointed” that the talks among senior officials of the United States, the European Union (EU), Brazil and India designed to revive the stalled WTO process broke down when the Brazilian and Indian delegations walked away from the negotiations. The talks within the so-called G4 group were intended to narrow the differences, mostly on agricultural issues, that have hampered the negotiations almost from their 2001 launch.
At issue is how far developed countries should go in cutting their farm subsidies and lowering their tariffs and to what degree developing countries should open their markets to industrial goods, farm products and services. The lack of progress on specifics related to those issues and many missed deadlines prompted the suspension of the WTO negotiations known as the Doha Development Round in July 2006. (See related article.)
Briefing the press June 21 via telephone, Schwab and Johanns said the United States has demonstrated flexibility both in its willingness to reduce its own trade-distorting farm subsidies and in the level of tariff cuts it expected from other countries.
But, as Johanns put it, “we stretched, did everything we could to bring about an agreement, and they grabbed.”
Nevertheless, Johanns said, he and Schwab were surprised by the decision of Brazilian Foreign Minister Celso Amorim and Indian Commerce Minister Kamal Nath because the talks within the G4 were making progress in recent months on many controversial issues. Those issues included food aid and sensitive products that would be subject to different rules than most other products.
“We feel like the rug was pulled from under our feet,” Johanns said.
Amorim and Nath blamed the United States and the EU and their “numbers” for the collapse of the talks, according to news reports.
“It was useless to continue the discussion, given what was on the table,” Amorim told reporters.
Schwab said that the Doha Round never will achieve its explicit goals of spurring economic growth and development and helping to lift people out of poverty unless new trade flows are created. And these trade flows will not be generated “unless and until there is sufficient new-market access in agriculture and manufacturing and services,” she said. Tariff-reduction proposals concerning manufactured goods offered by Brazil and India were insufficient in this respect, she said.
The U.S. officials said Brazil and India were expected to represent not only the interests of large emerging markets but also those of less developed countries.
That never happened, they suggested.
The least developed countries will be the biggest losers if the Doha Round is not concluded successfully, Schwab said.
Praising the EU for making a “significant contribution” to the round, Schwab said the United States still is committed to the negotiations and will continue to pursue a meaningful deal.
“The G4 may not ever be able to reach convergence, but … it doesn’t mean the end of the round,” she said.
Schwab said she and Johanns are going to Geneva, where the WTO is located, to talk to other interested countries, the chairmen of the negotiating committees and the WTO director-general about a possible way forward.
Johanns expressed hope that the progress made so far will help a broader group of WTO countries move forward.
The full text of the joint statement and a transcript of the teleconference are available on the USTR Web site.
