Reuters | Sept. 13, 2003
CANCUN, Mexico (Reuters) - World trade negotiators were making progress on Saturday in an attempt to bridge deep divisions between rich and poor nations and revive chances of sealing a global market-opening pact by the end of 2004.
As 2,000 anti-capitalism protesters marched toward the heavily guarded World Trade Organization meeting, ministers started to make concessions particularly on agriculture, which holds the key to the overall success of the talks.
``Our sense is that things are moving in the right direction in terms of an attitude favorable to negotiating,'' said U.S. Deputy Trade Representative Peter Allgeier.
``There was movement, in some cases significant movement,'' WTO spokesman Keith Rockwell said after Friday's sessions.
Protesters gathered in this Caribbean beach resort on Saturday and marched toward police lines around the hotel zone. Dozens were clearly ready for a fight, wheeling shopping trolleys and garbage cans filled with sticks and stones.
Inside the talks, ministers need to find enough common ground by Sunday to revive hopes of concluding a new trade pact that the World Bank says would add more than $500 billion a year to global incomes by 2015.
Negotiators labored late into Friday night to produce a compromise text to be presented to ministers as a basis for a frenzied final spurt of bargaining.
``Obviously, the proof is when we see the text, how we all react to that. But our impression overall ... is that countries do want to sit down and constructively negotiate a text,'' Allgeier said.
Agriculture is key because it is the livelihood of billions of people in developing countries, which are demanding that the United States and the European Union slash the huge subsidies they pay their farmers.
These handouts, the poorer nations say, limit their access to world markets and perpetuate poverty. Rich countries retort that they have already taken big steps to reduce the politically sensitive subsidies.
An accord would provide only a broad framework to guide negotiators in their work at WTO headquarters in Geneva. No figures on subsidy or tariff cuts will come out of Cancun.
``There will be an accord, but it won't be an accord that defines commercial rules,'' said Brazilian Agriculture Minister Roberto Rodrigues.
MUSCLE FLEXING
Poor countries, which make up three-quarters of the WTO's 146 members, have flexed their muscles like never before at Cancun by forming a powerful new ``Group of 21'' that includes China, India and South Africa as well as Brazil.
But the response of rich states is that with a host of competing political concerns -- U.S. presidential elections next year and the entry of 10 new members into the European Union -- they have limited room for concessions and poor countries should not push their demands too far.
Cotton has emerged as a litmus test of the willingness of rich states to keep their promise that this round of trade talks would focus on improving the lot of developing nations.
In a gesture of goodwill, the EU unveiled a plan for WTO members to phase out their most trade-distorting forms of cotton support, including those to promote exports.
The move came in response to an impassioned plea by four west African states -- Benin, Burkina Faso, Mali and Chad -- for an end to massive subsidies, particularly in the United States, which they say are crippling their economies by depressing cotton prices and blocking export opportunities.
Other issues divide the meeting and could still block an overall accord in Cancun even if a deal is struck on farming.
The EU and Japan are pressing for guidelines on foreign investment and competition to be grafted onto world trade rules but they have found virtually no allies among poor nations.Reuters:
