North-south split leads to collapse of WTO talks

Published on 15/09/2003 01:00

TALKS aimed at changing the face of farming around the world collapsed yesterday amid differences between rich and poor nations, delegates said.

"It’s over," said George Odour Ong’wen, a Kenyan delegate. "The chairman is calling the delegates to announce that the talks have collapsed."

Despite attempts at compromise, the trade talks at Cancun, in Mexico, were hit by a north-south split on issues ranging from rich nations’ massive farm subsidies to many developing countries’ refusal to negotiate new rules on foreign investment.

The mood was sombre as delegates of the 146-nation World Trade Organisation (WTO) met for a final round of hard bargaining yesterday.

Luis Ernesto Dervez, the meeting’s chairman, tried to break the deadlock on Saturday with a draft proposal aimed at giving all sides something with which to go home happy yesterday, the last of five days of talks.

However, the proposal was widely criticised. Poor and developing nations said it was far too soft in pushing the United States, the European Union and other rich countries to slash the $300 billion in subsidies they hand out to their farmers every year.

Arun Jaitley, India’s commerce minister, led the condemnation, saying the draft "arbitrarily disregarded views and concerns expressed by us" and "does not lend itself to any meaningful dialogue".

The EU also found much to complain about, saying a call for an elimination of farm subsidies at some point in the future was unacceptable.

"Positions seemed to be more firmly entrenched," said Keith Rockwell, a spokesman for the WTO. "This text as it currently stands is not acceptable to anyone."

Agriculture was the main issue in Cancun all week. Developing countries, led by Brazil, China, India and South Africa, say the US and EU subsidies cut their own farmers out of world markets and expose them to a flood of heavily subsidised imports.

"We see some light, much shadow and many grey areas which we have to tackle," said Franz Fischler, the EU’s agriculture commissioner.

Ministers needed to find sufficient common ground in Cancun to keep negotiations alive on a new trade liberalisation pact by the end of next year. The World Bank estimates a good deal would add more than $500 billion a year to global incomes by 2015 and lift 144 million people out of poverty.