GENEVA — The 150 members of the World Trade Organization have given director general Pascal Lamy the task of salvaging the Doha trade talks, which were dealt a serious blow with the collapse of negotiations among the U.S., European Union, Brazil and India.
The failure by trade and agriculture ministers from these countries, known as the G4, on Thursday to narrow their differences over lowering barriers to agriculture and industrial tariffs forced the powers to abandon their parallel talks and allow the search for a deal to emerge through the overall WTO.
“We will continue to support the Doha Round and the WTO, and the multilateral process to see if we can get to the point again where perhaps we have convergence,” U.S. Trade Representative Susan Schwab said after talks with Lamy and key WTO diplomats.
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Lamy told a specially convened meeting, “The need now is for urgent action to restore confidence that these negotiations can and will be finished successfully.”
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But senior WTO envoys said given the magnitude of the Potsdam fallout, it will be an uphill battle for Lamy and the chairmen overseeing the WTO-sponsored agriculture and industrial market-access talks.
The goal is for some compromise text to emerge that could be used as benchmarks to narrow differences and, down the road, to broker a final deal. However, senior G4 officials said it was unlikely that anything would emerge soon and, even if it came, would probably occur in the fall.
Schwab said that “if the director general wants to move a text, that’s fine.” But pressed about the timing of such a move, she said she would leave that up to Lamy, adding, “We need to let the dust settle.”
Schwab said Potsdam “was less of a negotiation and unfortunately, more of an auction,” and described the positions of Brazil and India on industrial tariffs as “extremely rigid.”
In the G4 discussions and also in the broader WTO Doha talks, the U.S. and EU pushed for developing countries to agree to bind the tariffs for manufactured goods at a maximum of 15 percent — a sharp cut from current levels of 35 percent — and offered to cap their own at 10 percent.
However, at Potsdam, Brazil’s Foreign Minister Celso Amorim said he would not move below 25 percent following a compromise demand by EU Trade Commissioner Peter Mandelson, backed by the U.S., that he accept 18 percent, G4 diplomats said.
Schwab, asked about the role of China in the talks and the fear of its growing power that is behind reservations by some nations to move on industrial tariff cuts, said, “Yes, we hear from developing countries and developed countries concerned about further opening of their markets because of imports from China.” She added, “China needs to play a more positive, proactive and constructive role in the WTO.”
Schwab also noted that “if China is just looking at its defensive interests, then I think that’s a very sad state of affairs and I have said that to our Chinese counterparts.”
Li Enheng, a senior Chinese official, said the U.S. should not shift the “responsibility and blame the failure [of the G4 talks] on any third party that is not involved in the process.”