"Serious setback" as WTO talks collapse


Last ditch talks between the world's leading trading powers this morning have collapsed after a final effort by the World Trade Organisation (WTO) to salvage a global agreement to boost trade in farm and industrial goods failed.

Discussions between the so-called G6 – the US, Europe, Brazil, Australia, India and Japan – represented the culmination of four years of talks in Doha, but ultimately ministers were unable to agree a deal on reforming world farming trade.

"The WTO negotiations are suspended," confirmed Kamal Nath, the Indian commerce and industry minister.

Mr Nath said that talks would not be resumed for anything between "months to years".

Celso Amorim, the foreign minister of Brazil, dismissed claims that the leading nations were being stubborn by saying "the silver lining is that all those who spoke continue to be committed", although he admitted he was "disappointed and concerned" over the impasse.

Reports suggest that the final straw in the talks was Susan Schwab, the US trade negotiator, accusing Europe of refusing to compromise on farm subsidies.

The six powers were trying to agree on a deal in order to allow the WTO's 149 countries time to finalise the details of a key global free trade treaty by an end of year deadline.

The Doha round of trade talks had to be completed before special powers for the US president, George Bush, to negotiate trade deals, expire.

Negotiations have persistently stumbled in the past on the question of farm subsidies and tariffs, with developing nations pressing the US and Europe to lower both.

Meanwhile, Washington and Brussels want developing nations to increasingly open up their markets to manufactured imports.

In yesterday's round of negotiations, diplomats failed to advance on the question of farm subsidies, with the US under pressure to make deeper cuts in the domestic support it provides to its farmers.

The US has previously insisted that it will not agree to lower subsidies further unless the EU agrees to lower farm tariff barriers.

Pascal Lamy, the director-general of the WTO, has called a full 149-member meeting for later today in response to today's diplomatic stalemate.

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