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Last Updated: Saturday, 28 January 2006, 15:16 GMT
New deadline for world trade deal
By Tim Weber
Business editor, BBC News website, in Davos

US Trade representative Rob Portman at Davos
The US has demanded the EU give ground on agriculture
World trade negotiations are back on track after officials meeting in Davos agreed a new timetable to achieve an agreement this year.

The "work programme" outlines a precise timetable for 33 contentious subjects from agriculture to aid for trade.

The breakthrough was a deal to move on all key issues - agriculture, services and manufacturing - at the same time.

The US trade representative said there was now "an unparalleled opportunity to boost the global economy".

This would lift millions out of poverty, said Robert Portman.

EU trade commissioner Peter Mandelson spoke of a "better mood" at the negotiating table.

They were speaking after an informal meeting of trade officials from about 25 nations on the sidelines of the World Economic Forum.

Moving in concert

In the run-up to Saturday's agreement trade officials from the EU, US and developing nations had engaged in a furious series of briefings blaming each other for stalling the talks by demanding that the issues closest to their interests be resolved first.

The timetable is designed to break this cycle and set "a significant change in pace, style and content of negotiations," said Egyptian Trade Minister Rachid Rachid, who also speaks for the African nations in the world trade round.

Both Mr Portman and Mr Mandelson described it as "moving all issues in concert".

The new found agreement, however, did not stop trade officials from taking pot shots at each other during an afternoon of media briefings - pointing out alleged inconsistencies or lack of flexibility in each others' positions.

Mr Mandelson spoke of a lack of movement on agricultural tariffs, the danger that the service sector might be "left behind", and warned a trade deal would be achievable only if everybody were to gain from it.

Indian Trade Minister Kamal Nath underlined that the European Union and United States had to give way on agricultural subsidies.

Mr Portman, for his part, demanded offers of "substantial market access" for agricultural products and "aggressive tariff reductions" for manufactured goods.

Outlines of a deal

So despite the agreement on a clear timetable for trade talks, this is far from being a done deal.

"Every is waiting for somebody to make an offer," said Mr Nath, pointing out that diplomats had about two days to resolve each of the 33 complex issues.

The most contentious sector of international trade - agriculture - is supposed to be wrapped up by the end of April.

Amongst other things the work programme proposes deadlines to:

  • abolish all subsidies for cotton exports by developed countries by 2006

  • establish a framework for a deal on market access of manufactured goods by end of April

  • deliver a draft agreement on the service sector by end of October 2006

  • and table a working document on Intellectual Property rights by July.

To accelerate the process, all parties have agreed to hold bilateral meetings outside the WTO process.

India and the European Union, for example, will meet next Wednesday in London so that both sides can explore "what is your problem, what is your last line", Mr Nath said.

The small group of trade officials agreeing the timetable encompassed the key nations and trade blocs in the 149 member World Trade Organization. The organisation's director general, Pascal Lamy, was also present.

Campaign groups like Actionaid, however, criticised that the talks had gone ahead without the presence of important least developed nations like Zambia.

Hong Kong aftermath

In December last year a global trade summit of the World Trade Organization ended in near-failure in Hong Kong with only minimal trade liberalisation achieved.

The time to reach a global trade pact is tight because next year US President George W Bush will lose his "fast track authority" to strike a trade deal, and Congress is unlikely to renew it.

Critics of the current trade round say industrialised countries have failed to make any substantial concessions to developing countries, and that it would better for the negotiations to collapse than to result in a bad deal.

The new found agreement, however, did not stop the trade officials from making small digs at each other during their briefings - pointing out alleged inconsistencies or lack of flexibility in each others positions.

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