News

Trade talks make development top priority

By Donna Borak
UPI Business Correspondent
Published 12 December 2005

HONG KONG -- While trade ministers are less than hopeful of making any major breakthroughs in liberalizing agriculture during a key ministerial in Hong Kong this week, the United States, along with other key developed nations, is seeking to put forth a detailed package for least-developed countries.
"We know we won't get as far as we had hoped to in the Hong Kong ministerial -- after all this is supposed to be the four modalities meeting, kind of the final framework -- but we also know that we need to use our time here very productively," Rob Portman, U.S. trade representative, told reporters in Hong Kong Monday.
Negotiations in the so-called Doha round have stalled over the politically strained issue of agriculture subsidies due to the European Union's reticence to make any further changes to its farm proposal. But while talks are at standstill, ministers are expected to make the needs of the least-developed countries the highest priority during talks this week.
Portman, who has publicly said no major breakthroughs will happen at the World Trade Organization ministerial this week in Hong Kong, said the United States would seek to improve market access for least developed counties by supporting a duty-free quota-free system for poor nations.
"We support the objective of duty-free quota-free for least developed countries and we look forward to working with our trading partners this week to implement that," said Portman.
The top U.S. trade envoy told reporters before leaving for Hong Kong on Saturday that trade partners must "give the least developed countries more assurance as to what they will get from the round," primarily through trade capacity building.
While the United States purports to have one of the leading trade-for-aid programs supplying $1.3 billion to least developed countries, it has also signaled its intent to expand current preference programs like AGOA, which help aid sub-Saharan countries, and Sanitary and Phyto-santiary regulations, which aid least-developed countries. But while Portman said it would pursue measures in Congress to expand preference programs to help developing nations integrate into the global economy, he stressed on Monday that a development package would not be the only ingredient to having a successful round.
"I'm pleased with the prospect that we can do more here in Hong Kong with regard to a development package for least developed countries, but we have to remember that progress on the development package is no substitute for progress on the market access openings that are part of the overall success of this round," said Portman.
"I would even go so far to say, progress on the development package is not adequate in and of itself because it is tied to success in the overall round."
Already, several major developed and developing nations including India, Brazil and Japan have put forth proposals to help aid the 49 least-developed nations of the world. Last week, following the Group of 7 summit, both Brazil and India, who lead the Group of 20 developing nations, agreed to open up their markets to services and industrial goods, if developed nations would agree to match similar offers.
While India said it would lower its tariff barriers by more than 50 percent, if developed economies could match or exceed their proposal, Brazil pledged to concede some ground on industrial tariffs, if the United States and EU agreed to do the same on agriculture.
On Friday, Japan pledged to provide $10 billion in trade-related assistance to least-developed countries for a three-year period. The Japanese government also said it would provide duty-free quota free access for "essential products" originating from least-developed countries.
Portman applauded Japan's proposal saying it would help bring "more momentum here in Hong Kong on the aid for trade package."
However, despite efforts by developing countries to break an impasse in global trade talks, the European Union has refused to acknowledge India and Brazil's offer and has remained obstinate in refusing to make further changes in its farm proposal.
"We and the United States are the only ones who have made any proper offers," Peter Mandelson, EU Trade Commissioner, told reporters via video-conference from Brussels on Friday. "We've done so in agriculture... Now, what we haven't seen are proper offers on the negotiations on services or on non-agricultural market access from Brazil or India."
The United States, which has repeatedly called on the EU to make further reductions to its agriculture subsidies and tariffs, called on the EU to make further concessions in order to advance talks.
"A forward leaning response from the EU is something that will allow us to bring this together," a senior U.S. trade official told United Press International. "The EU proposal is less ambitious than the G20 developing countries' proposal. What's recognized is to get a development package, which is what we all want, we've got to see progress from the EU and we're hoping that will be forthcoming."

Source: World Peace Herald