HONG KONG — Amid violent protests, frantic marathon bargaining generated enough momentum to keep the Doha round of trade talks moving forward.
The World Trade Organization meetings here managed to reach agreement on lowering trade barriers for cotton and other goods from the world’s poorest nations. In addition, trade ministers agreed to eliminate agricultural export subsidies by 2013, a key element to the round of trade talks. Much haggling remains, though, and increased access to the U.S. market for some products, such as textiles, could produce bitter political fighting in Washington. The progress made in Hong Kong won’t be locked in until the Doha round is completed perhaps late next year.
After six days of talks and a sleepless night, ministers emerged Sunday evening with a revised declaration that will provide the basis for negotiations in the coming months. The Sixth Ministerial Conference was declared closed at 10:42 p.m. here.
“We managed to put the round back on track after a period of hibernation,” said WTO Director General Pascal Lamy.
The last ministerial meeting in Cancun, Mexico in September, 2003, fell apart when poor cotton producing countries walked out in protest of cotton subsidies in the developed world.
The consensus declaration didn’t come easily in Hong Kong. Ministers buckled down Saturday for an all-night cram session to review the first of two revisions. Their effort resulted in a second revised text that was distributed to the press Sunday afternoon.
The atmosphere was tense until the very end with knowledge that time was running out for this Hong Kong conference, and if parts of the second revised text were rejected, then the talks could break down at the last moment.
“We all worked hard this week, with respect, courtesy and determination to achieve our common goals,” said U.S. Trade Representative Rob Portman in prepared remarks Sunday. “Nerves can sometimes fray with little sleep when 149 countries are working their way through complex and often politically charged issues. But the rules-based multilateral trading system is intact and I think we saw here in Hong Kong the strengthening of a consensus among a diverse group of nations that through trade, we can spur development and opportunity.”
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The three main revision areas in the declaration were agriculture, nonagricultural market access (NAMA) and specific development issues. While the majority of ministers expressed overall disappointment, they were satisfied that decisions had been made on certain points.
Expectations for Hong Kong were lowered significantly in recent months, but ministers repeatedly said they had to come up with a framework for future meetings in order to preserve the credibility of the organization. They felt that this is what they had delivered: a platform for the next meeting — probably to be held in Geneva in March — that might lead to the conclusion of the talks by the end of next year. Wrapping up talks by then is important because President Bush’s Trade Promotion Authority expires in July, 2007. If the Authority is not renewed, it would be much more difficult to get an agreement through Congress.
“This has been a very important conference … we have a document,” said Foreign Minister Celso Amorin of Brazil on behalf of the G20 developing nations.
Perhaps one of the biggest breakthroughs was an agreement to end agricultural export subsidies by 2013.
“I said we came to Hong Kong to do business and this shows we meant it,” said E.U. Trade Commissioner Peter Mandelson in a statement.
For cotton, the second revision text states that export subsidies would be eliminated by developed countries in 2006, and African cotton producing countries, along with other least developed countries (LDCs), will have duty-free/quota-free access to markets in developed countries. The WTO also agreed to try to further reduce trade distorting domestic subsidies for cotton.
From a larger manufacturing standpoint, Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition, said he’s “very concerned with the nonreciprocal theme rampant through the text.”
“The U.S. takes on enormous obligations,” which will be damaging to the domestic manufacturing base, he said.
Tantillo, who was in Hong Kong for the talks, also was concerned about a proposal presented by the LDCs in the second revised text because it opens the U.S. market to duty-free treatment for countries such as Bangladesh, a competitive textile and garment producer, he said.
He added the arrangement could undermine existing U.S. preferential arrangements, such as CAFTA or NAFTA, which are major outlets for exports of U.S. yarn and fabric.
There is a provision in the second revision that allows for countries to exempt 3 percent of their tariff lines across all product categories from being duty-free/quota-free. This may spur a “massive political fight in the U.S.” over which products that percentage will include, Tantillo said.
With the situation tense in meeting rooms, things were equally tense on the streets. Rioters pledged earlier in the week that they would show more force in their protests as the week progressed. Saturday afternoon saw the worst violence. A few hundred protesters attempted to storm through a police line in the afternoon armed with long bamboo poles and hard objects, which prompted a water cannon response.
Later, more than 1,000 people marched through Wanchai, which is where the Hong Kong Convention and Exhibition Centre is located, and successfully broke through police barriers. Militant Korean farmers led the charge and toppled railings and wooden protective barriers around buildings; the group also tried repeatedly to overturn a large police van.
At that point, protesters were within meters of the ministerial venue’s doorstep, which was locked during the riots to ensure protesters couldn’t enter the building. Police used wood batons, pepper spray foam and tear gas as a response to the escalating violence, the worst Hong Kong has seen in decades.
A total of 116 people were injured during the riots, including 56 police officers. Arrests totaled more than 1,000. As of Sunday night, 188 had been released.