AUSTRALIA: WTO proposes big protection cuts in next Doha round
Updated
Free trade negotiators have urged the 150 member countries of the World Trade Organisation to make some "very painful" cuts to tariffs and subsidies, in a bid to end the impasse in the Doha round of global trade talks. The latest proposal from Geneva is an attempt to get the major players back to the negotiating table after India and Brazil walked out of talks last month. Australia says the new proposal offers poor countries a good deal, but forces developed states to make unfair concessions on protection.
Presenter: Alexandra Kirk
Speakers: Australian Trade Minister Warren Truss; international trade adviser Alan Oxley
KIRK: The World Trade Organisation has launched a new bid to broker a compromise between rich and poor countries on trade liberalisation in farm and industrial goods. The chief agriculture negotiator Crawford Falconer has suggested cutting United States farm support down to between 13 and 16 billion dollars. In an accompanying statement he says it's time to cut to the chase and says:
FALCONER: "We have frankly exhausted all other avenues and the prospect of failure is, as a consequence, now so familiar to use that it can almost present itself seductively to us as our friend".
KIRK: At the same time, the negotiator on the non-agricultural side is proposing 27 developing countries cut industrial tariffs to 23 per cent at most, with developed countries capping tariffs at eight or nine per cent. Australia thinks that gap is unacceptably wide and that developed countries should be allowed a 10 per cent tariff barrier. But overall, Australia's Trade minister Warren Truss considers it a "useful" and "constructive" basis for more talks.
TRUSS: I hope that all countries will try and look at this in a constructive way, and none of us have everything in this text that we would like but there is something in it for everybody to build on, and I hope that it can be useful in restarting negotiations.
KIRK: The clock is ticking to get all 150 members of the WTO to agree before the US presidential election gets underway. The Director General of the World Trade Organisation Pascal Lamy says some targets will be "very painful", but that pain will be needed to get agreement. He concedes not everyone will be fully satisfied with the texts, but adds that what separates them today is smaller than what unites them. Negotiations stalled when India and Brazil walked out of a meeting with Europe and the U-S. Minister Truss hopes India views the new plan positively.
TRUSS: Well I think India will see some things in this proposal that they find satisfactory, others may be challenging to them. I think they would have been looking for a bigger reduction in US farm subsidies than is proposed, but in some areas, in particular the treatment of developing countries in the arrangements, they may well have a higher level of satisfaction.
KIRK: The newest WTO entrants - including Vietnam, Moldova and Saudi Arabia - are not being asked to make more concessions.
TRUSS: And so they I would imagine would be quite pleased with that element of the text, the concessions for larger economies like China are not so substantial, but even so China as one of the really big developing countries would expect to do more than could be expected of a country like Vietnam.
KIRK: The latest Geneva document also puts the focus back on so-called state trading enterprises. In Australia's case that means the single desk wheat exporting monopoly arrangement. Australia is not impressed.
TRUSS: I'm surprised and disappointed that they would reopen the issue of whether or not single desk should continue beyond 2013. Australia's position on that is quite clear, this issue is resolved and it should not be back on the table.
KIRK: And Australia would not agree?
TRUSS: We believe it's reasonable that there should be appropriate constraints on their operations, but the continuing use of monopoly powers is an essential part of a fair trading regime.
KIRK: While Australia's Trade Minister says the new WTO propositions should breathe new life into the negotiations, international trade adviser Alan Oxley does not think agreement is any more likely now.
OXLEY: I think what we saw at Potsdam where the Indians wouldn't participate in the discussions and then there was no agreement to shift positions until we see the community willing to make some major cuts and see the Indians play ball and see the Americans go along with this, I think this all remains largely academic unfortunately. The politics say we won't if you will, the reality is unless a country is willing to make the domestic changes, unless Europeans are willing to make substantial cuts in their domestic supports regardless of what other people do, we can't get a result.
KIRK: So you're not optimistic?
OXLEY: No I'm afraid not.
