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WRAPUP 2-Trade ministers seek Doha progress for Pittsburgh G20

Published 06/25/2009, 04:15 PM
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* Trade ministers say Doha talks in end-game

* Aim for progress by G20 Pittsburgh summit in September

* Boosting trade an economic stimulus

* Protectionism a threat as trade volumes contract

By Jonathan Lynn

PARIS, June 25 (Reuters) - Trade ministers want to point to concrete progress in the long-running Doha round to free up world trade in time for September's G20 summit in Pittsburgh, Australia said on Thursday.

Trade Minister Simon Crean, speaking after a meeting of his foriegn counterparts in Paris hosted by Australia, said completing Doha would help pull the world out of the economic crisis because trade itself was an economic stimulus.

"The result of today's meeting was a restatement by ministers that we now are in the end-game of negotiations," Crean told a news conference.

The Doha round was launched in late 2001 to help poor countries prosper through trade, but in the nearly eight years since then the talks have stumbled repeatedly as trading powers clashed over proposals to cut tariffs and subsidies on goods from food to chemicals.

Crean said there was a new willingness to work together on a deal, spurred by the recession that was hitting developing countries hardest.

"I think the big dynamic that's changed is that leaders have said we want Doha concluded and we stand ready to assist in bringing it to that conclusion," Crean said.

World Trade Organisation (WTO) Director-General Pascal Lamy said the challenge now was to convert the improved atmospherics into a concrete deal.

"The mood music is now more congenial and it's playing at a faster pace. We now must shift from mood music to dance music," he told the news conference.

TALKING TO EACH OTHER

Earlier U.S. Trade Representative Ron Kirk called for a new approach to the Doha talks, involving direct negotiations with key trading partners as the traditional multilateral format was not working.

From the current incomplete package of deals it was clear what the United States would give up but hard to see exactly what it would gain, he said, given the many exceptions to an overall agreement for various countries, making the deal opaque.

"We think getting more clarity around that may be the key to helping us find a solution to a way forward," Kirk said after a meeting of ministers at the Organisation for Economic Co-operation and Development (OECD).

Developing countries had expressed fears they could be strong-armed into an unbalanced deal through a one-on-one approach.

But participants in the meeting at the Australian embassy said there was acceptance the WTO's traditional multilateral negotiations could be complemented by one-on-one talks to provide clarity about a likely deal, indicating a looming obstacle to the talks had been removed.

"Until they believe they're in the end-game nobody's going to do the kind of bilateral deal-making that's required," said one official.

"People will talk when they need to talk," added the WTO ambassador of one big emerging country.

Kirk has also called on big emerging countries to open their markets further to foreign goods to help secure a Doha deal.

But the trade ministers from India, Brazil and South Africa, meeting on the sidelines of the OECD, rejected that call.

"At this final stage of negotiations, in the midst of the worst economic environment since the Great Depression of the 1930s, it would be unreasonable and unrealistic to assume that further unilateral concessions from developing countries will be forthcoming, especially in the context of the current economic crisis," the three ministers said in a statement.

The Doha talks have been effectively on ice since a meeting of ministers last July failed to clinch an outline agreement, although Lamy said it had completed 80 percent of a deal.

A number of positive comments in recent weeks, not least from Kirk and his new Indian counterpart Anand Sharma, have kindled hopes the talks could resume shortly.

WTO chief Lamy told the OECD meeting that completing Doha was all the more important because trade was expected to contract by 10 percent this year -- 14 percent in developed countries and 7 percent in developing countries.

Figures from the International Air Transport Association IATA suggested global trade was still far from recovery.

Demand for cross-border air freight dropped 17.4 percent year-on-year in May, IATA reported.

Lamy said the economic crisis underlying the trade contraction was giving rise to protectionist pressures, as a group of 11 small and medium-sized export-led economies called at the OECD meeting for an early conclusion of the Doha round to help fight protectionism.

Both Kirk and China's WTO ambassador Sun Zhenyu said a series of recent trade disputes launched by the United States and China against each other at the WTO showed a willingness to resolve differences by the rules and were a sign of mature trading relationships rather than growing trade tensions.

But Kirk said the United States would not hesitate to make a legal challenge to launch aid for the new Airbus A350 passenger jet and A400M military plane.

He said the United States expected a result by the end of August in an existing case brought against the EU over earlier launch aid for Airbus, a subsidiary of EADS. The EU has filed a counter-case against U.S. state support for Boeing aircraft.

"We think it is a grossly over-reaching example of government assistance in private industry and contrary to the WTO rules," Kirk said.

EU trade spokesman Lutz Guellner said the details of any financing had not been finalised but would reflect WTO rules and Brussels would defend itself against any challenge. (Additional reporting by Tamora Vidaillet in Paris and Laura MacInnis in Geneva; Editing by Matthew Jones)

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