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Europe

WTO Ministers Adopt Compromise Trade Accord

Trade ministers adopted a compromise text Sunday to clear the way to a global trade deal in 2006, agreeing to cut farm trade export subsidies and providing special breaks for the poorest nations.

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A deal was done, despite the protesters outside

The document provides for European Union agricultural export subsidies to be scrapped by 2013, a key sticking point, which the United States and key developing nations had wanted removed in 2010.

Anti-poverty campaigners condemned the agreement as a betrayal of the poor but ministers from the main trading blocs welcomed it as a modest step forward which could pave the way for an overall trade liberalization accord in 2006.

"We are tipping the balance in the WTO back in favor of the developing countries," said WTO Director General Pascal Lamy after the agreement was finally approved after six grueling days of negotiations. "You have put the round back on track, you have given it a sense of urgency," Lamy said, referring to the Doha Round of trade negotiations launched in 2001 and due to be completed by the end of 2006.


Europe gives way

WTO Pascal Lamy schüttelt John Tsang die Hand

Lamy (l.) can breathe a sigh of relief


EU Trade Commissioner Peter Mandelson said the text was "acceptable" after other countries had accepted the EU compromise on the date. "Today, Europe has gone further on its existing commitment by setting a clear date, 2013, for the elimination of export subsidies," Mandelson said. "We have demanded and received equivalent movement from the other countries. While the outcome of Hong Kong is not a great success, this move of ours is enough to save it from failure."

The United States also welcomed the text, saying it had come to Hong Kong to build a solid platform to move forward global trade liberalization and that this had been achieved.

Brazilian Foreign Minister Celso Amorim said the Group of 20 major developing countries also accepted the compromise. "That keeps a certain degree of credibility" in the WTO negotiations, he said. "As coordinator of the G20 I am very happy to see those elements."


Anti-poverty groups angry

However anti-poverty campaigners were not so pleased.

"This is not a deal, it's a fraud," the head of ActionAid's trade justice campaign Aftab Alam Khan told AFP. Oxfam's trade campaign chief Phil Bloomer said rich countries had conceded minimal access to their agricultural markets while opening up the sensitive industrial and services sectors of developing nations. "This is a profoundly disappointing text and a betrayal of development promises," Bloomer said.

Agreeing on a date to scrap the subsidies, which critics say prevent farmers in poor countries from competing effectively on world markets, had been one of the trickiest issues at the six-day meeting.

The document is intended to guide ministers in further negotiations, with the goal of approving a final trade liberalization deal and completing the current round of negotiations by the end of 2006.

Violent protests

As officials talked, the harbor-side conference center was totally sealed off, with police out in force to prevent more rowdy anti-WTO protests after clashes on Saturday in which nearly 100 people were hurt.

Polizeiaufgebot zur WTO Konferenz in Hong Kong

Hundreds of protesters fought police on Saturday in the most violent demonstrations since the talks started

Police used tear gas, fire hoses and pepper spray Saturday to hold back hundreds of demonstrators led by militant Korean farmers, some of whom were armed with bamboo sticks and metal bars. The violent scenes Saturday were highly unusual for Hong Kong where marches by hundreds of thousands of pro-democracy protesters in recent years have passed off without a single incident.

On the divisive issue of cotton, the WTO text said all developed country export subsidies would end in 2006 while the poorest producers would get duty-free and quota-free market access once an overall accord was agreed. Crucially, no date was given for an end to these domestic subsidies.

African cotton producers have been pressing rich countries -- and the United States in particular -- to eliminate their domestic subsidies, which they say depress world prices and keep them mired in poverty, by Jan. 1. On trade in industrial goods and services, where the developed world wanted progress in exchange for removing its farm trade export subsidies, the document sketched out a formula for cutting tariffs but left it to be finalized.





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