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EU trade boss urges nations to look beyond farm row

By: | at 07:00 PM | International Trade  

Europe’s trade chief urged EU countries to look beyond sacrifices needed in agriculture for a global trade deal and to focus instead on the bigger potential gains for other areas of the economy.

EU Trade Commissioner Peter Mandelson, under constant pressure from France not to offer any more farm concessions, said all European Union countries had “a balance sheet of gains and losses” from the recently revived global trade talks.

It was important that “member states are prepared to look at the balance sheet at the end of the process and not prematurely”, he said after briefing EU ministers on the state of the World Trade Organization (WTO) negotiations.

“We’ve yet to get on to the serious negotiations where the bulk of the round’s gains exist, and that is in industrial goods and services,” he said.

The WTO launched its Doha round of negotiations to boost trade in 2001 after the Sept. 11 attacks jolted the world.

The talks were suspended last year due to differences, mainly over agriculture, and were only revived two weeks ago after signs of new flexibility. Asked about talks between the EU and the United States on the farm trade part of the round, Mandelson said: “Negotiations are continuing and we are certainly not moving backwards.”

Those talks involve Brussels possibly going further in cutting tariffs that protect its farm markets, and Washington being more ambitious with cuts to its farm subsidies.

That could pave the way for a broad WTO deal that would see big developing nations such as Brazil and India lowering barriers for imports of industrial goods like cars or chemicals and for providers of services such as telecoms or banking.

European and US business groups are frustrated that agriculture, which accounts for only around two percent of the EU’s economy for example, is holding up the round.

Mandelson said EU governments agreed Europe must be constructive in the WTO talks, but France again called on Mandelson not to offer new farm concessions.

“There is a sort of desperation to save the United States,” French Trade Minister Christine Lagarde said. “Once our cards are on the table, it’s impossible to take them back.”

She said a WTO deal this year looked unlikely.

France has claimed support from over half the EU’s member states, and President Jacques Chirac has said Paris might veto any WTO deal that requires too many farm concessions by the EU.

EU diplomats say some governments that have backed France in the past are probably too interested in other areas of the round to object to last-minute farm concessions by Brussels.

Germany, which holds the EU presidency, reiterated its hopes for a deal that would benefit European business.

“From the German and European perspective, substantive (moves) for market access for industrial goods and services are essential,” Economy Minister Michael Glos said in a statement, urging ambition across all negotiating sectors. (Reuters)