The EU trade chief's surprise move to take up a British cabinet job could be a final nail in the coffin for efforts to resurrect the Doha trade round. Peter Mandelson was one of the EU's strongest free trade advocates.
Peter Mandelson is stepping down as EU trade commissioner
Mandelson had refused to give up on Doha even after ministerial talks collapsed in July, pledging as late as last month that the EU were ready to revive the World Trade Organization negotiations if others were.
The WTO meeting broke up without an accord chiefly because of a dispute between India and the United States over proposed help for poor farmers.
The talks foundered on the so-called special safeguard mechanism, which allows a country to impose tariffs to protect products in the event of a surge in imports and was favored by India to shield its farmers but opposed by the United States.
The WTO's Doha Round, launched in the Qatari capital with the aim of forging a new world trade pact, has repeatedly missed deadlines set for its conclusion.
Mandelson wanted to save Doha round of trade talks
Replacement gets cool reception
Catherine Ashton's appointment as European Trade Commissioner, replacing Peter Mandelson, was received with incredulity by the Geneva trade community.
"It doesn't give you a lot of confidence that anything can be pulled together," one influential WTO ambassador told Reuters news agency, adding that prospects for a global trade deal had shifted since yesterday.
Ashton's poor reception was attributed to her inexperience and lack of profile. Many feel she will struggle to match up to Mandelson, who was widely respected as master of the trade brief and a driving force behind efforts to liberalise trade in the Doha round.
"Mandelson's departure at this juncture, when we are so delicately poised, is clearly a huge setback," India's WTO ambassador Ujal Singh Bhatia told Reuters.
"He provided great leadership to the Doha process and took many risks to take the talks forward. He will be sorely missed."
The unforeseen return to the cabinet of current EU trade minister Peter Mandelson is part of embattled British Prime Minister Gordon Brown's attempts to shore up his government with a reshuffle.
Under Gordon Brown, New Labour's popularity has nosedived
The replacement of Defence Secretary Browne, who will be succeeded by current Business Secretary John Hutton, is as surprising as the return of Mandelson, seen as an "arch-Blairite" and a highly accomplished political figure, who is understood to be taking over Hutton's former post as business secretary. ´
The reshaping of the Brown government had been precipitated by the resignation of Transport Secretary Ruth Kelly who was said to have been disillusioned with Brown's leadership.
Sense of deja-vu
Another "returnee" will be Margaret Beckett, an experienced Labour politician and former foreign secretary. Nick Brown, a former agriculture minister and close ally of Gordon Brown, will also return to the cabinet, according to unconfirmed reports.
But the return of Mandelson, who has twice resigned from a Labour government under a cloud, was the most surprising move.
Mandelson was a close ally of former PM Tony Blair.
Analysts said the reshuffle was clearly aimed at adding some "weight and experience" to the cabinet, which had been criticized in some quarters for being "too young."
They said it also showed that the old "Blairite and Brownite" divisions, which had plagued the Labour Party under Tony Blair, had been overcome.