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Doha countdown

By DONNA BORAK, UPI Business Correspondent

WASHINGTON, March 2 (UPI) -- For over a year now, world leaders have put the Doha Development Agenda back on schedule, after several years of standstill. However, the challenges on remaining issues of agriculture have still yet to be negotiated.

It is expected that during a three-day mini-ministerial meeting in Kenya, which begins Thursday, trade ministers are aiming to iron out negotiations and further inject momentum in international trade talks before they are faced with the next major ministerial meeting in Hong Kong in December.

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The Doha Round, which was officially launched in November 2001 in Qatar by the World Trade Organization, was aimed at liberalizing trade and creating a new rule making agenda for developing countries.

Doha was then perceived as a "new era" for the WTO with a broad economic agenda, which would revitalize world trade without leaving impoverished nations behind. It would offer "special and differential treatment" to developing countries in order to close the trade gap between industrialized and third world nations.

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But in 2003, during the fourth ministerial meeting in Cancun, talks collapsed after decisions on agricultural and non-agricultural market access were left uncompleted.

The first sign that the so-called Doha Round could possibly succeed in meeting its ambitious goals came last summer in Geneva when trade ministers were able to agree on a new framework for negotiations.

"That agreement really put the negotiations back on track," said Jeffrey Schott, Senior Fellow at the Institute for International Economics.

"There isn't a lot of time to get from the general agreement that was made last summer in Geneva to the detailed commitments that will be required to put a final deal together," he added.

Trade ministers have been feeling the pressure of locking in an agreement quickly so that they can spend the final year of negotiations in 2006 on the tedious but crucial details on what reforms each country will make, explained Schott.

"The challenge today and what the officials are going to be talking about in Kenya this week and in other meetings in Geneva and around the world over the next nine months is how officials can make enough progress across the broad agenda including agriculture, industrial products and services," said Schott.

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In Davos, Switzerland, earlier this year, WTO Director-General Supachai Panitchpakdi called on 20 world leaders while at the World Economic Forum, to meet the challenges ahead in completing negotiations on the Doha Round before the final ministerial meeting in Hong Kong in December.

"They have moved, but they have not moved far enough to guarantee what I would see as a real progress at Hong Kong," Supachai told the Deutsche Welle in Davos.

As key representatives from G20 and G90 countries meet in Kenya, in one of several mini-ministerial meetings planned in the forthcoming months, leaders are hoping to capture the spirit of good will established in Davos, while trying to gage where the remaining difference are and in what areas compromise can be made.

"I think it is more to privately gage each other's positions and see where there are openings and explore ideas about formulas," said Claude Barfield, international trade analyst at the American Enterprise Institute in Washington, D.C.

Thus far the challenge of Doha, despite promising proposals rests on internal subsides, agricultural products, services and industrialized tariffs.

"It's not that they haven't offered some compromises, it's a question of finding the right formula. You just don't know the answer. That's what these meetings are about see where the give and take is," said Barfield.

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The United States and EU have both been pushing for a conclusion since 2004, submitting their own proposals for consideration to WTO members. The EU has proposed to end its agricultural export subsidies and drop issues of investment, competition and transparency. It has called on the United States to further reduce their farm subsidies, and has asked India and China to reach an agreement on non-agricultural market access.

The United States, according to the trade representative office, has put forth its own comprehensive agricultural trade reform proposal calling for the elimination on export subsidies, a $100 billion cut in global trade-distorting domestic subsidies and lowering the average allowed global tariff from 62 percent to 15 percent. It has also introduced a plan for zero tariffs in certain sectors, which would cut over $6 trillion in annual world goods trade.

Recognizing the challenges ahead, both U.S. and EU trade representatives have been highly motivated and optimistic that talks in Kenya would bridge the gap over services and non-agricultural market access.

"The Doha round stands at an important point and there is a need to balance the negotiations," said EU Trade Commissioner Peter Mandelson. "We need to capitalize on the goodwill generated at the Davos informal ministerial to put the round firmly on track for Hong Kong in December."

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"We need to make progress, especially on services and non-agricultural market access, where we need greater ambition. I want the meeting this week to make serious inroads to a major policy package on development and I intend to press this," added Mandelson.

Acting U.S. Trade Representative, Peter Allgeier echoing similar sentiments said that he hoped that the informal talks provided an opportunity to assess the progress made on negotiations and that it would provide a "capital based" Minister level guidance for future negotiations.

"Much difficult work remains, but Ministers are committed to pushing the negotiations process forward in Geneva, particularly at the core areas of negotiations: agriculture, goods, services, rules including trade facilitation and development," said Allgeier.

The United States and the EU have committed to completing negotiations by 2006. Allgeier called on ministers to provide additional energy and direction to negotiations in order to advance talks.

"In continuing to provide leadership to advance Doha, we will continue to also press all the WTO Members to step up and contribute, because the Doha truly provides the best opportunity to promote continued global economic growth and hope and opportunity," said Allgeier.

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