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UPDATE 2-Cairns Group says Doha trade talks "within our grasp"

Published 06/09/2009, 05:32 AM
TGT
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* WTO chief sees conclusion of Doha Round sometime next year

* Cairns Group sees opportunity to reinvigorate Doha

* U.S. confirms it has finished reviewing trade policy

* EU, U.S. dairy export subsidies overshadow meeting

By Sunanda Creagh and Gde Anugrah Arka

NUSA DUA, Indonesia, June 9 (Reuters) - Prospects for wrapping up troubled world trade talks have improved, after signs of a new commitment from key players such as the United States, a group of major agricultural exporting nations said on Tuesday.

Trade ministers came close in July 2008 to a deal on the Doha round of talks, but the talks collapsed over a dispute between Washington and emerging economies spearheaded by India over proposals to help farmers in poor nations.

The Cairns Group -- 19 nations accounting for more than 25 percent of the world's agricultural exports -- said in a communique at the end of a meeting in Bali that trade officials from the United States, Europe and India had shown fresh resolve to concluding the Doha talks launched in 2001.

"These special guests have told us they share the commitment of the Cairns Group to reinvigorate the negotiations, with a view to bringing the Doha Round to conclusion in the shortest possible time," the communique said, adding: "This outcome is within our grasp, and we are determined to make it happen."

Political conditions for a world trade deal have shown signs of improving, although protectionist sentiment is rising as well because of the global crisis, including dairy export subsidies brought in by Europe and the United States this year.

U.S. Trade Representative Ron Kirk met India's new trade minister Anand Sharma on Monday, with Sharma describing the meeting as "very positive".

FRESH MOMENTUM FOR DOHA

World Trade Organisation Director General Pascal Lamy said the meeting produced fresh momentum for the moribund Doha Round.

"I saw Ron Kirk and Anand Sharma clearly engaging in a process that should lead to the conclusion of the round sometime next year," Lamy said. "We hadn't had that signal until now."

"My own global diagnosis is that we have done 80 percent of the job, 20 percent remains, among which is the special safeguard mechanism and the agreement of tarriff reductions in some sectors," Lamy told reporters at the end of the meeting.

Lamy said the safeguard mechanism -- which allows poorer nations to impose tarrifs when faced with cheap imports and helped trigger the collapse of last year's talks -- would be among the technical issues addressed in Geneva in coming months.

"Negotiators must reconvene in Geneva as soon as possible to map out a clear path towards the conclusion of negotiations and to start down that path before the European summer break," the communique said. "USTR's Kirk and Commerce Minister Sharma of India fully endorse these views."

The Obama administration, which appointed Kirk in March, has conducted a review of U.S. trade policy including efforts to reach a deal on the Doha round.

Kirk, a former mayor of Dallas who took up his post in March, confirmed that Washington had completed the review.

"We have laid out some very broad principles for how we think trade can and should be conducted in the U.S.," Kirk told a news conference, adding that policies should target measurable and achievable results.

U.S. trading partners had been keenly awaiting details on the policy review, but Kirk declined to elaborate and only said it "will guide our policy on subsidies".

CONCESSIONS ON FARM SUBSIDIES

Brazil's trade ambassador to the WTO, Roberto Azevedo, told Reuters on Monday he believed Washington was ready to make concessions on its agricultural subsidies, which have proved a major sticking point in trade talks.

The Doha deal is estimated to be worth $150 billion for the world economy and is considered even more important now that the world is facing its worst economic crisis in decades.

The gathering of leading agricultural exporters also warned against protectionism.

"It is essential that we guard against the downward spiral of protectionism in agriculture," said the communique, singling out for criticism the recent introduction by Europe and the United States of dairy export subsidies.

The European Union and Washington have said the subsidies do not breach WTO rules.

The Cairns Group consists of Argentina, Australia, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, the Philippines, South Africa, Thailand, and Uruguay.

(Editing by Ed Davies and Bill Tarrant)

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