It was the EU vs the Rest of the World as global trade talks remained deadlocked yesterday, with the EU defending itself from a barrage of criticism that its refusal to further open its farming markets threatened to torpedo the entire WTO meeting.
Poor nations say that as a part of a global free-trade deal, the EU, the US and other rich nations must cut their farm subsidies and tariffs that block developing countries' access to those lucrative markets.
Chile's foreign minister, Ignacio Walker, blasted the EU's farm subsidy program, which critics say totals up to US$110 billion a year. Walker said that works out to about US$2 a day for each cow.
"So many poor people wish they would be at least as well off as an EU cow," Walker said.
But European nations say they have already offered generous cuts in agricultural programs, including an average cut 46 percent on farm tariffs, and that developing countries, particularly Brazil, India and China, need to counter with offers to lower their trade barriers to services and manufactured goods.
"The EU has presented a complete agricultural package," said Elena Espinosa, Spain's agricultural minister.
"What did the others present? Nothing, nothing, nothing," she added.
In the area of beef, for example, the EU said its proposed tariff cuts would lift beef imports from a current level of 500,000 metric tons to a projected 1.3 million metric tons, a figure that equals the total amount of Australian beef exports.
The trade talks, mired in a stalemate over the farm trade issue even before it began, encountered further problems yesterday when Honduras said it might reject an overall agreement produced at the WTO gathering unless the 25-nation EU agrees to reform its banana import policies.
"We hope to try and find an agreeable solution before Sunday," Honduras' WTO Ambassador Dacio Castillo said.
"Otherwise it's going to be difficult to accept whatever will be the outcome of this meeting," he said.
Honduras said the EU is acting illegally by effectively ignoring several WTO rulings that have sided with Latin American countries who say the Brussels' tariff regime seriously limits their ability to export the fruit.
Caribbean and African banana producers, however, benefit from the EU's current system of tariffs and quotas, which favors them over large-scale growers in Latin American, who claim the system is unfair. The smaller producers say eliminating those and they risk getting squeezed out of the market.
The WTO bases its decision on consensus, and the agreement of each of its 149 members is required on any deal. So technically, Honduras could single-handedly cause the meeting to collapse, though that is unlikely at this stage.
Separately, the US is prepared to allow impoverished West African nations duty-free access to its cotton market, Washington's trade chief announced yesterday.
"The United States is willing under the duty-free, quota-free commitments we will make, to provide duty-free access to cotton for West African countries," Rob Portman said at the WTO ministerial conference.
The move would be part of a package of measures aimed at helping the world's poorest countries that is under discussion at the meeting, he said.
Portman said an agreement could be possible on such a package, although he signalled that the US was very wary of opening up its market further to textile producers from Bangladesh.
The US has faced stiff criticism over its massive subsidies to its own cotton producers, which other governments and campaigners say have driven down global prices and ruined West African farmers in the process.
The EU gave the move a cautious welcome but said it did not go far enough.
"It's a positive step that the US is prepared to allow cotton free access to its market," EU trade spokesman Fabian Delcros said.
"However, this measure won't solve the current problem in the cotton market ... The current problem is that the US pays subsidies which depress world prices and prevent African producers from being competitive. What's needed is more discipline at the WTO to stop this dumping," he said.
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