WTO may have to lower sights for Hong Kong meet

By Richard Waddington and David Brough
Reuters
Monday, November 7, 2005; 9:39 PM

LONDON (Reuters) - Trade ministers appeared ready on Tuesday to discuss lowering expectations for a World Trade Organization (WTO) meeting next month because their differences are too wide.

At the end of six hours of talks in London between ministers from Brazil, India, the United States, the European Union and Japan, India's Trade Minister Kamal Nath told journalists that the WTO might not be able to achieve the full blueprint for a global free trade deal as planned.

"Expectations of Hong Kong will not be, with the availability of time, what they were two months ago," Nath said, adding this had been acknowledged by ministers inside the closed-door talks.

He said this would be discussed with a wider group of ministers when the trade talks switched to Geneva later on Tuesday.

With a mid-December deadline, the ministers, who represent wide interests within the WTO, met at the Indian embassy in London to try to bridge differences.

After four years of negotiations, the gap between developed and developing nations, particularly over agriculture, remains wide. All sides have warned that the WTO negotiations face collapse unless it can be narrowed fast.

Begun in 2001, the WTO's Doha Round aims to lower barriers to business across the world economy and lift millions out of poverty. Ministers from its 148 member states had been aiming to approve a detailed blueprint -- or "modalities" in WTO-speak -- in Hong Kong next month.

WTO Director-General Pascal Lamy, who was at the talks, warned that failure would cost the world economy hundreds of billions of dollars in lost trade opportunities, and that poorer countries would lose the most.

MIGHT BE HALF

Diplomatic sources quoted Lamy as telling ministers: "We will have to think about lowering expectations for Hong Kong," although he did not say where the bar should be set.

Previously, Lamy has said he wanted the Hong Kong meeting to take the round two-thirds of the way toward conclusion, with all the major bargaining and trade-offs done.

But Nath said instead of two-thirds it might be less.

"Hong Kong may not be full modalities -- maybe half the modalities -- but that doesn't mean we've written off the ambitions of the round," he said.

Asked whether this meant another WTO ministerial early next year, he answered that it was too early to say.

Other ministers at the talks, European Union Trade Commissioner Peter Mandelson, U.S. Trade Representative Rob Portman, Brazilian Foreign Minister Celso Amorim and Japanese Trade Minister Toshihiro Nikai said there had been some progress, although no big breakthrough.

"I think that we go into that meeting (in Geneva) with a stronger platform than we had at the beginning of today, and that is progress at least," he said.

Mandelson, who has been under pressure to give more ground on farm tariffs, got his way in having the discussions extend beyond agriculture to industrial goods and services.

But Brazil, with India a leader of the influential G20 developing country alliance, said more needed to be done on opening up rich nation farm markets.

"I think there is a lot of ground to be covered yet, and the gaps are still very big," Amorim said.




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