WTO Talks Yield Limited Progress

World Trade Organization (WTO) farm talks last week made no headway on the core issue of market opening, but outlines of a deal are emerging in other areas as an April deadline looms, a senior U.S. official told Reuters News Service March 24.

"On market access ... the level of ambition is not there, there are big loopholes and we haven’t really seen real meaningful improvements," says the official, who declined to be further identified.

WTO states are scrambling to reach draft pacts by the end of April on farm and industrial goods, key areas of the Doha round of free trade talks. Failure could end chances of a full treaty this year and possibly sink the talks altogether.

The official says he expects efforts to reach a farm deal to intensify over the next two weeks, with further meetings between various groups of key states, possibly outside Geneva.

In agriculture, the U.S. official says key elements for an accord were there for export competition and domestic support, which along with market access make up the three so-called "pillars" of the farm talks.

But Brussels remains under heavy pressure for deeper tariff cuts from both developed country farm goods exporters, such as the U.S. and Australia, and developing country farm powers like Brazil.

"We are pretty close on export competition and we are pretty close on domestic support, where you just have to figure out what the numbers are," the U.S. official says.

The official said that market access discussions had focused largely on "sensitive products", which are those that will be partially shielded from any tariff-cutting formula that is agreed.

Brussels wants to classify 8 percent of tariff lines as sensitive, although EU officials say privately the bloc is prepared to see this figure fall significantly.

It hasn’t spelled out the goods to be covered, but they would be expected to include dairy produce, beef and sugar.

The Doha negotiating mandate also calls for significant market opening even in sensitive products, and talks in Geneva this week focused on how this could be done.

"There is a general recognition that the EU approach is too complex and does not offer enough," the official says.

Despite the U.S. official's assertion that an accord appeared near on domestic support, Brazil and the EU are still pressing Washington for further cuts.

On food aid, another controversial area of the export competition talks, the official proposals put forward by African states this week, including a definition of emergency assistance, could provide the basis for an accord.

Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

To see more market perspectives, visit Brock's Web site at www.brockreport.com.