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Last Updated: Saturday, 27 January 2007, 13:57 GMT
World trade talks set to restart
By Tim Weber
Business editor, BBC News website, Davos

Man drives a tractor in a field
Concessions on agriculture are key to breaking the deadlock
Trade ministers from some 30 countries have agreed to resume the Doha talks to liberalise global trade.

However the ministers' statement was short on specifics and its wording revealed that they have not really moved much closer to reaching a deal.

Pascal Lamy, director general of the World Trade Organization, said the Doha round was "living, it will continue".

Leaders of developed and industrialised nations had both warned that a failure of the talks would be "catastrophic".

The talks at the sidelines of the World Economic Forum in Davos, Switzerland, have been seen as one of the last chances to make a decisive move to revive the Doha round before the fast-track authority of US President George Bush runs out in July.

After that deadline US Congress could block key parts of any trade deal, which would then scupper the treaty.

Mr Lamy said that the US government would try to get an extension of this fast-track authority.

This would give trade talks a "window of opportunity", he said, adding: "It's a question of months rather than quarters."

EU Trade Commissioner Peter Mandelson said "the alternative to what's on the table is not the perfect deal, but no deal at all".

Mr Lamy said ministers would try a fresh "landing approach" to reach a deal "as soon as we can as time is running out".

He added the talks on the sidelines of the World Economic Forum had proved that "you can defreeze even in Davos".

However, one year ago ministers also met in Davos and agreed a much more detailed and ambitious timetable to rescue negotiations, which came to nothing.

'Agricultural sensitivities'

Once again agriculture appears to have been the sticking point in the negotiations.

Mr Mandelson said any deal needed to strike "a balance between the need to advance decisively on farm trade liberalisation and the need to respect the reasonable agricultural sensitivities of the less competitive and those with large subsistence farm sectors".

The negotiations were suspended last July amid sharp differences over farm subsidies and import tariffs.

Campaign groups, however, were quick to criticise the outcome of the talks in Davos.

"However the new talks are framed, poor countries will still be asked to throw open their economies in return for peanuts from the trade superpowers," said Aftab Alam Khan of Actionaid.

Failure 'catastrophic'

On Friday, Brazil's President Luiz Inacio Lula da Silva had told the World Economic Forum that rich nations should show flexibility to help conclude a vital agreement.

"We have never been so close to doing a deal like this," he told the gathering of political and business leaders.

Lula said Brazil was ready to make concession if Europe and the US were also prepared to move.

If it succeeds, great. If it fails, it will be catastrophic
Tony Blair
UK Prime Minister

A trade agreement could help ease poverty in many countries and inject billions of dollars into the global economy, he said.

South African Trade Minister Mandisi Mpahlwa had told Reuters his country was very concerned at the prospect of failure.

"We never had a round with so much on the table and the likelihood of losing it all is quite big," he said.

However, British Prime Minister Tony Blair expressed optimism that the World Trade Organization's (WTO) talks, known as the Doha Round, could resume, amid signs that everyone was prepared to make concessions.

"If it succeeds, great. If it fails, it will be catastrophic," Mr Blair said.

Business groups have also been stepping up calls for governments to reach a deal.

WTO Director General Pascal Lamy
WTO Director General Pascal Lamy is pushing for progress by July
The Doha Development Agenda was launched in 2001, but has repeatedly stalled.

The 150 members of the WTO have agreed that the current trade round should be designed to help developing countries, while opening up new markets for industrialised nations.

The US and EU want developing countries like Brazil and India to open their economies to industrial goods and services.

Developing nations argue that the US and the European Union must cut agricultural subsidies and tariffs if progress is to be made.




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