G-33 MINISTERS CALL ON DEVELOPED COUNTRIES TO TAKE FIRST STEP TO BREAK DOHA DEADLOCK

Members of the G-33 bloc of developing countries called on industrialised nations to take the lead in breaking the deadlock in the Doha Round trade negotiations by offering greater cuts to their farm subsidies, during a summit in Jakarta on 20-21 March.

"It shouldn't be on the developing countries to be the ones to move faster or more than the developed countries," Indonesian Trade Minister Mari Pangestu told a press conference.

The 42-member G-33 has been the principal advocate of allowing developing countries to designate up to 20 percent of farm products as 'special' for more lenient tariff treatment based on food security, livelihood security and rural development concerns. Many of the countries in the group have substantial numbers of subsistence farmers, whom they are eager to shield from potentially disruptive levels of additional import competition. The group also supports creating a 'special safeguard mechanism' to allow them to afford farmers some protection from import surges.

Several developed and developing country farm exporters have sought to limit the scope of both types of flexibilities, fearing compromised access to new markets. The US has been particularly vocal in its opposition, describing them as a 'black box' of loopholes partly to blame for its inability to offer up the deeper subsidy cuts that many other Members desire.

Brazilian Foreign Minister Celso Amorim noted that the G-33's demands sprang from a need to mitigate the effects farm subsidies and "excessive" tariff and non-tariff barriers in rich countries. The "G-20 fully subscribes" to the goals of livelihood, rural development and food security, he said. Brazil leads the G-20 bloc of developing countries, some of whose members have been ambivalent about the G-33's demands (see BRIDGES Weekly, 29 March 2006). A highly competitive agricultural producer, it does not belong to the G-33.

G-33 countries emphasised that backing down on their demands could open the floodgates to cheap, heavily-subsidised products from developed countries such as the US. They also argued that liberalising developing country agricultural markets was never one of the objectives of the Doha Round. "This round is a development round, it's all focused on market access from the developing countries into the developed countries, not the other way around," Indian Commerce Minister Kamal Nath said in Jakarta. "We cannot negotiate the livelihood of our farmers," he stressed.

Nevertheless, Indonesian minister Pangestu stressed that the G-33 was willing to be flexible if the developed countries were. "We're moving. We're doing our homework and we're ready to negotiate once there is movement on the other issues," she said.

EU Trade Commissioner Peter Mandelson attended the summit. Prior to leaving for Indonesia, he issued a statement indicating that he would brief the ministers there about the various bilateral talks that have been taking place among the EU, the US, Brazil and India as they attempt to identify components of a potential agreement (see BRIDGES Weekly, 7 March 2007). He also planned to discuss steps their countries could take to help bring the talks to a successful conclusion. "I will be reviewing with them the progress made by the G-4 since the beginning of the year and sharing my assessment that whilst we have made progress, we are now running into very serious time limitations as the clock ticks to the expiry of the US negotiators' trade promotion authority at the end of June," he said via a spokesperson.

Kamal Nath took a different view on the constraints imposed by the expiry of the US presidential administration's mandate to submit trade agreement to Congress for a yes-or-no vote without the possibility of amendments, generally thought to be a prerequisite for finalising a deal. "The question is whether the developed countries are willing to make things move forward to move towards an artificial deadline which arises out of their own political, their own domestic situation," he told reporters. Nevertheless, he said that ministers at the meeting had agreed to work towards a breakthrough.

Geneva-based diplomats say that several other countries are growing increasingly frustrated with these 'quiet discussions' among major trading powers, both due to the lack of progress and a sense of marginalization. WTO Director-General Pascal Lamy last week called for a renewed emphasis on the multilateral negotiation process (see BRIDGES Weekly, 14 March 2007).

ICTSD reporting; "G-33 ministers call on rich nations to give more concessions," DEUTSCHE PRESSE AGENTUR, 21 March 2007; "WTO Negotiations Need Developed Countries' Initiative," BLOOMBERG, 21 March 2007; "Cut farm subsidies: Nath," REUTERS, 21 March 2007; "India urges rich nations to give ground as G33 meets," REUTERS, 21 March 2007; "Mandelson: Trade Talks Have Limitations," ASSOCIATED PRESS, 20 March 2007; "Developed countries urged to take initiative in WTO negotiation," XINHUA, 21 March 2007.