A week of tense trade talks started on Monday in Geneva with most sides professing willingness to compromise but saying that others had to take the lead.
The meeting, which brings together several dozen ministers in the so-called Doha round of talks, represents a gamble by Pascal Lamy, the World Trade Organisation’s director-general, that big negotiating divisions can be bridged in a few days. Similar meetings in the previous two years ended in acrimonious collapse.
Rachid Mohamed Rachid, the Egyptian trade minister, said there was probably a 60 per cent chance of the talks achieving their aim of a framework deal to cut tariffs on agriculture and industrial goods.
“Expectations are very low …and that usually helps people to be in a more positive mindset, because they are not going to disappoint anybody,” he told the Financial Times.
But the start of the talks was also overshadowed by uncertainty over the stance of India, given the absence of Kamal Nath, the country’s trade minister, from the first two days of the negotiations. Mr Nath is in Delhi to attend Tuesday’s parliamentary vote of confidence in India’s coalition government.
Mr Nath, who has more than once been instrumental in causing ministerial meetings in the Doha round to collapse, is for the moment being represented by G.K. Pillai, his deputy at the commerce ministry, nicknamed “Dr No” by one business lobbyist for his intransigent negotiating style.
Observers close to the Indian delegation said there seemed to be an atmosphere of willingness to compromise, but warned that this might merely be political positioning to shift the blame if the talks collapsed.
Peter Mandelson, the European Union trade commissioner, suggested on Monday that the EU could increase its plan to cut farm import tariffs from the current offer of an average 54 per cent cut to 60 per cent. But other officials said the figure appeared to be a recalculation of the Commission’s existing offer, and added that the real problem was the EU’s desire to shield some of its farmers from across-the-board tariff cuts.
Mr Mandelson and the US have called on big emerging market countries not to seek to exempt entire sectors of their manufacturing industries from cuts in protection, proposing a so-called anti-concentration provision in the industrial goods talks.
Several highly contentious peripheral issues also have the potential to derail the talks. Last week Mr Lamy proposed a solution to the long-running dispute over the EU’s policy of favouring banana imports from its former colonies in Africa and the Caribbean over those from Central America.
The EU said it would be prepared to accept the proposal, which would be a one-off cut in import tariffs in return for an end to litigation at the WTO, but the Central American countries have so far refused to agree.
●Wrangling over bananas delayed the 1957 signing of the Treaty of Rome, which created the European Economic Community, and has bedevilled international trade negotiations ever since, writes Frances Williams in Geneva.
The issue essentially involves a battle for the European banana market, the world’s largest, between Latin American producers and African, Caribbean and Pacific (ACP) countries, mostly former European colonies, which receive preferential treatment.
The present dispute follows 11 rulings in the World Trade Organisation against the EU’s banana regime, which allows ACP bananas to enter duty-free but imposes a tariff of €176 ($279, £140) a tonne on imports from Latin America.
The EU says it is ready to accept a WTO plan to cut the tariff to €116 by 2015. In return, Latin American countries would drop their lawsuits.
But the Latin American producers want bigger and faster cuts while the ACP countries say the proposal already goes too far. Both sides are threatening to veto any Doha accord if their concerns are not met.
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