IE 11 is not supported. For an optimal experience visit our site on another browser.

Leaders praise WTO trade agreement

Trade negotiators reached a last-minute deal on Sunday, gaining some progress toward the World Trade Organization's goal of forging a global trade pact by late 2006.
/ Source: The Associated Press

Government leaders on Monday praised a WTO trade agreement to end farm export subsidies but said much work remains to reach a broader, binding global trade treaty by late 2006.

The agreement late Sunday was a badly needed breakthrough for the World Trade Organization, whose credibility was on the line following devastating collapses of two of its last three key meetings.

After six days of intense negotiations, delegates from both wealthy and poor countries reconciled their conflicting interests, agreeing to eliminate farm export subsidies by 2013, work toward dismantling trade barriers in manufacturing and services and to provide greater protections and support for developing countries.

“You put the round back on track. You gave it a new sense of urgency,” a jubilant WTO chief Pascal Lamy told the delegates.

Developing nations felt the final agreement addressed many of their concerns, from opening up rich nations’ farming markets to measures that could enable the world’s poorest countries to increase their tiny share in global trade.

“We welcome it,” said India’s Trade Minister Kamal Nath. “It is focused and it strikes at various problems of developing countries.”

But the outcome of the six-day meeting left some disappointed — and puts pressure on the WTO if it hopes to conclude a binding global trade treaty by the end of next year.

“The agreement we have reached, if it didn’t make the conference a success it certainly saved it from failure,” said EU trade chief Peter Mandelson.

Pushing back the date for eliminating farm export subsidies to 2013 was a key demand of the 25-nation EU, which held out against intense pressure from Brazil and other developing nations to end the payments by 2010. Developing nations say the subsidies undercut their competitive advantage in farm trade and threaten the livelihood of their poor farmers.

The agreement approved by all the WTO’s 149 member countries and territories also gives the world’s poorest nations special trade privileges. Exporters from least developed countries — with annual per capita incomes of less than $750 — will be allowed duty-free and quota-free market access on 97 percent of the products imported by rich nations by 2008.

“That is something people have only dreamed of up until this time,” said New Zealand’s Prime Minister Helen Clark.

Clark said getting rid of export subsidies by 2013 is an advance — but said progress needs to continue.

“There’s still the market access issue, and that’s us getting our goods into other markets without high tariffs, and that’s what’s proving a bit tricky at the moment,” she told TV One Monday.

French President Jacques Chirac welcomed the accord, saying Sunday that it favors France and global economic growth, but that it did not go far enough to help poorer nations.

The deal “will contribute to development of the poorest countries while still preserving the indispensable potential of European agriculture,” Chirac said in a statement. France’s farmers are among the top beneficiaries of EU agricultural subsidies.

However, he added, “this progress on development still remains insufficient and must be followed up upon.”

Germany’s economy minister, Michael Glos, said the outcome fell “short of expectations.”

“In the new year, it will be important for us to represent emphatically in the follow-up negotiations in Geneva the interests of our industry in opening markets,” he said.

The agreement falls far short of the delegates’ original ambition for Hong Kong: producing a detailed outline for a final trade treaty that would conclude the Doha round of talks, named after Qatar’s capital, where it was launched in 2001 particularly to address the concerns of poorer nations.

Negotiators now aim to work out formulas for cutting farm and industrial tariffs and subsidies — the nuts and bolts of an eventual trade pact — by April 30.

“The progress made today really lays the groundwork for negotiations going forward,” said Susan Schwab, a deputy U.S. trade representative.

Activists and other critics of the Geneva-based WTO claim its work on opening up markets benefits big companies and the rich at the expense of ordinary workers and the poor.

Past WTO gatherings served as battlefields for anti-globalization protests, but Hong Kong authorities managed to prevent violent clashes between police and activists from disrupting the talks. More than 800 protesters — mostly South Korean farmers — remained in detention Monday. Police rounded them up after they went on a violent rampage Saturday outside the WTO convention hall in downtown Hong Kong.