Pittsburgh: World leaders on Friday promised quick action to conclude long-running world trade talks and told their top trade officials to meet by early next year to begin the final push for a deal.
“We have agreed to work for an early conclusion of the Doha round of trade negotiation,” Prime Minister Manmohan Singh told reporters at the end of the Group of 20 summit.
But the pledge, which went only slightly further than a previous goal of reaching a deal in 2010, raised questions whether countries were ready to make the politically hard decisions needed to finish the talks.
The Doha round is already the longest set of multilateral trade talks in history. It was launched in late 2001 with the goal of helping poor countries prosper through trade and has suffered many missed deadlines and setbacks.
There are also questions about how hard US President Barack Obama, already facing tough fights in Congress on health care reform and climate change, is willing to push for a deal that many members of his own Democratic party could oppose.
But Obama told leaders that “the United States is as much interested in ensuring the Doha round reaches a satisfactory balanced conclusion as any other country and I have no reason to doubt his sincerity,” Singh said.
Leaders of the G-20, which groups major industrialized and developing countries, were in Pittsburgh for talks aimed at putting the world on a path to more sustainable growth following the worst economic downturn in decades.
“Today the leaders have clearly spoken about what they expect on the Doha Round, a conclusion in 2010. It is now up to their negotiators to walk the talk, starting Monday in Geneva,” World Trade Organization (WTO) Director-General Pascal Lamy said.
Developing countries say deal on the table
A group of around 100 developing countries - including G-20 members Brazil, India, China, Indonesia, Mexico, Argentina, South Africa, South Korea and Turkey - issued a separate statement urging a deal based on a package of proposed tariff and farm subsidy cuts already on the table.
“The vast majority of developed and developing countries support. The only way to conclude negotiations in a reasonable timeframe is to finalize the existing package, through a transparent, inclusive and multilateral process,” they said.
Washington has said it needs to do one-on-one talks with big emerging countries like Brazil, India and China to get more clarity about what it would gain from a deal.
After nearly eight years of negotiation, WTO members still have not reached agreement on core formulas, known in trade jargon as “modalities,” for cutting agricultural and industrial tariffs and reducing trade-distorting farm subsidies.
“In order to conclude the negotiations in 2010, closing those gaps should proceed as quickly as possible,” the G20 leaders said in a joing statement . “We ask our ministers to take stock of the situation no later than early 2010.”
There was no decision yet on where that stock-taking session would be held, Lamy said.
US wants more exports from deal
Reaching a deal on agriculture and manufacturing modalities would put WTO members most of the way to a final agreement. But US farmers and manufacturers are unhappy with proposals now on the table and services trade negotiations have barely begun.
Estimates of the value of a deal vary, with the Peterson Institute for International Economics recently saying it could boost world GDP by $300-700 billion a year by opening up new trade in agriculture, manufacturing and services.
The Obama administration says it needs big emerging countries like China, India and Brazil to open up more to create enough support in Congress to win approval of a deal.
Developing countries, who say they are supposed to be the main beneficiaries, say this puts too big a burden on them.
Countries this week steered clear of any decisions on the substance of the negotiations and instead bickered over what was the best path for getting to a final deal.
The language reflects a compromise between the United States, which was wary of setting a target to reach a deal on modalities this year, and other countries led by the European Union, Brazil and Australia pushing for swift progress.
The G-20 leaders also said it was “imperative we stand together to fight against protectionism,” repeating a pledge they made in two previous meetings and that critics say has been too often ignored in the past year.
President Barack Obama’s decision this month to slap a 35% tariff on tire imports from China is one of the most recent examples singled out by such critics. US officials defend the action as legal under a “safeguard” provision that Beijing accepted as a term of its entry into the WTO in 2001.