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| Sunday, 14 September 2003 |
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Rich and poor square off over farm trade in Cancun by Alan Wheatley and Richard Waddington CANCUN, Mexico, (Reuters) Rich countries under pressure to slash farm subsidies searched on Thursday for weaknesses in a new alliance of poor nations bent on rewriting world trade rules they say are rigged against them. Developing countries, increasingly assertive within the 146-member World Trade Organization, in turn brusquely rejected demands led by the European Union and Japan for new guidelines to govern overseas investment. "This is an exercise in futility," Malaysia's trade minister, Rafidah Aziz, said of the plan for investment rules. The rhetoric reflected the deep divisions on a host of issues that ministers meeting in this Mexican resort need to narrow by Sunday to revive stalled global trade talks the World Bank says could lift 144 million people out of poverty. Outside the conference hall, the day passed off peacefully as activists mourned a South Korean who stabbed himself to death on Wednesday in protest against the WTO's policies. Agriculture is the most critical issue in Cancun because it is the mainstay of most poor countries, which blame the $300 billion doled out mainly by the United States and the EU to their farmers each year for pricing them out of world markets. A new coalition of 21 developing countries has sprung up to demand the scrapping of those subsidies without promising more access to their own markets - an initiative that diplomats said showed the growing clout of poor states in the WTO. "This is a significant shift in the dynamic structure of this organization," said Australian Trade Minister Mark Vaile. WTO ministers on Thursday approved the membership of two more developing countries, Cambodia and Nepal. As hard bargaining went on into the evening, the United States took a lead in trying to undermine the fledgling group, which includes China, Brazil, India and South Africa. "It's really unclear to us what is the unifying principle there among those countries," said Deputy U.S. Trade Representative Peter Allgeier. "On the one hand, you've got some of those countries that were among the most ambitious countries for agricultural reform. Then it goes across the spectrum ... to countries that have not been advocates of reform," he told reporters. NO ONE-WAY STREET Another senior U.S. official asked rhetorically what a backer of farm reform such as Brazil had in common with India, which is loath to cut the high tariffs shielding its markets. "We're not quite sure the glue that binds them, beyond making the point that they want their voices to be heard. Our goal is to work with those who share our broader ambition to really make it happen here," the official added. Diplomats said the subtext of Washington's message was that, with the 2004 U.S. presidential election looming, the United States would find it hard to improve on what it sees as a generous offer that has already drawn political fire. "It can't be a one-way street whereby the United States agrees to eliminate subsidies but the rest of the world does nothing," said Chuck Grassley, who chairs the U.S. Senate Finance Committee, which has jurisdiction over trade matters. Similarly, proposed reforms to the EU's $100 billion farm program - dismissed by critics as wafer-thin - have gone over badly in some EU member states, especially France. Seen in that light, diplomats said the risk for poor states is that if they refuse the offer now on the table, the Cancun talks will fail and they will be saddled with the current set of subsidies for several more years. |
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