TRALAC - Trade Law Centre

US courts Africa before Doha round meeting

Tuesday, 15 July 2008

Source: The Guardian (United Kingdom)

US Trade Representative Susan Schwab urged sub-Saharan African countries on Tuesday to join the United States in pushing for a world trade deal that requires India, Brazil, China and other major developing countries to further open their markets.

A breakthrough next week in the long-running Doha round depends on how many new export opportunities that major developing nations provide for other countries, Schwab said at an annual meeting with sub-Saharan African countries.

Success also depends on how much rich countries like the United States and the European Union are willing to cut farm subsidies and tariffs, she said.

Schwab's remarks came a day after major farm organizations expressed "deep concern" to President George W. Bush about the prospects for a deal they could support.

"We are also alarmed by statements, including some reportedly made by administration officials, suggesting that concessions on U.S. agriculture are to be traded off for gains in (manufactured goods trade) and services," said groups representing wheat, soybean, corn, cotton, dairy, rice and other U.S. farmers.

Schwab and other top trade officials will be in Geneva next week in hopes of reaching breakthroughs on key tariff-cutting formulas and other elements of a deal that have long eluded negotiators in the nearly seven-year-old Doha round.

Pascal Lamy, the World Trade Organization's director general, has called it the "moment of truth" for the round because failure could delay a final agreement for years.

Schwab said South Africa was the only member of the African Growth and Opportunity Act (AGOA) partnership forum with the United States being asked to make tariff cuts.

The rest are excluded because of their status as poorer developing countries and negotiators are considering special tariff treatment for South Africa, she said.

'MANIPULATION'

Schwab told the sub-Saharan group she had urged AGOA trade ministers in a private session on Monday not to give into pressure from bigger developing countries to settle for a weak tariff-cutting formula since that would block African countries from getting new export opportunities.

"I suggested that Africa and African countries at the WTO not let themselves be manipulated by groups of other countries, other developing countries, that may be trying to reduce their market-opening contributions in agriculture and manufactured goods in the Doha round in the name of developing country solidarity," she said.

Sub-Saharan countries already have duty-free access to the United States for most of their goods under AGOA, and a weak tariff-cutting formula would block sub-Saharan countries from new export opportunities in countries like India, Brazil and China, Schwab said.

Botswana's trade and industry minister, Daniel Neo Moroka, did respond directly to that point but said developing countries should remain united on the need for deep cuts in rich country farm subsidies and tariffs.

"We should insist on a level playing, especially in agriculture," Moroka said.

'A LOT AT STAKE'

Schwab also began meeting with key members of the U.S. Congress on Tuesday to discuss next week's meetings in Geneva.

In a statement, Senate Agriculture Committee Chairman Tom Harkin, an Iowa Democrat, said he remained committed to a "good, balanced deal" in the Doha negotiations, even though Congress just passed generous new farm subsidy legislation.

"The Doha round of trade talks was launched with the hope that trade policy would be reformed to help the world's poorest nations while boosting trade opportunities for all members of the WTO," said Harkin, whose panel is meeting Schwab later this week.

"There is a lot at stake in these talks and we should not lose sight of this goal."

House Ways and Means Representative Charles Rangel, a New York Democrat, said Congress probably would be willing to give the White House renewed "fast track" trade authority to complete the negotiations if a breakthrough occurs.

"It's hard for me to believe that if we have reason to believe that we can reach agreement and fast track can make a difference that we could not find some way to fashion a way for us to be a positive force in Doha," Rangel told reporters.

U.S. manufacturers said the proposed formula for reducing tariffs on manufactured goods in advanced developing countries was much weaker than they could support.

A breakthrough is possible only if a dozen or so major developing countries such as China, India and Brazil agree to begin separate negotiations in areas such as industrial machinery, chemicals, wood and paper products, and electronics and electrical goods, said Frank Vargo, vice president of the National Association of Manufacturers.

The goal would be for a critical mass of countries to reduce tariffs in those specific sectors to zero, or at least much more dramatically than the general tariff-cutting formula would require, Vargo said. (Reporting by Doug Palmer; Editing by John O'Callaghan)