Apec prepares for trade showdown with EU

Nov 16 | Updated: Nov 17 2005, 06:12am hrs
Asia Pacific ministers meeting in South Korea have set the scene for a showdown with the European Union over agriculture subsidies ahead of World Trade Organisation talks next month.

We call for breaking the current impasse in agricultural negotiation, in particular market access, the 21 trade and foreign ministers meeting in Busan, South Korea, said in a draft of the Asia Pacific Economic Cooperation leaders statement to be released on the weekend. Unless progress is made in this area, we cannot make progress in the round as a whole.

Some Apec ministers on Tuesay said the WTO talks would collapse if the EU didnt offer bigger cuts to agricultural subsidies.

EU officials had on Tuesday hit back at criticisms of their stance, saying they didnt need lectures and it wouldnt be helpful to broaden their offer ahead of the WTO ministerial meeting in Hong Kong from Dec. 13-18.

It is make or break time, Australian foreign minister Alexander Downer said in Busan. Its crucial in the next few days and weeks leading up to Hong Kong that there be some reconsideration by those countries that still havent made sufficient market access offers for agriculture, in particular the European Union.

Leadership role

The summit gives Apec a chance to take a leadership role before next months WTO meeting, Bush said in a speech in Kyoto, Japan, on Wednesday before heading to Busan.

We both agree that the Doha Round must proceed, Bush told reporters, referring to talks with Japans Koizumi. We both recognize that weve got work to do.

Finger pointing

We urge all other WTO members and especially those that have the largest stake in the global trading system to show the flexibilities needed to move the negotiations forward by and beyond Hong Kong, the Apec leaders draft statement said.

The main impediment has been disagreement over how much to scale back farm-related subsidies, tariffs and other industry supports in rich economies such as the US and Europe.

At the moment, the EUs offer is not a sufficient offer for there to be agreement on the question of agricultural market access, Australias Downer said.

EU Trade Commissioner Peter Mandelson, who on Oct. 28 made what he described as a bottom-line offer to implement the deepest-ever cuts in European farm-import tariffs, said he wont broaden that proposal before next months talks.

It is better for Apec to use its gathering to create a platform for negotiation than for finger-pointing, he told reporters on Tuesday in Strasbourg, France.

I do not believe it would be helpful to the talks to make a further offer on agriculture, Mandelson said. If we cannot bring balance back to these talks, they will not progress. Still hopeful

Portman said on Wednesday in Busan the US has not given up hope of a breakthrough in the WTO trade talks. We still believe that we can come together with a solution that enables us to keep out offer on the table, but also allow others to make the necessary concessions so that we can find a solution, he said.

-Bloomberg