WASHINGTON, Nov. 29 (UPI) -- With only two weeks left until a key ministerial meeting in Hong Kong, developing and agricultural exporting nations are intensifying pressure on the European Union to make further reductions on farm subsidies and tariffs.
Despite pleas by the developing world to bring greater market access and steeper cuts on agricultural subsidies, the EU has said it will not accept "extravagant demands" ahead of the upcoming ministerial next month.
"We are not prepared to accept the extravagant demands of Brazil and the G-20, the Cairns group of group of countries, including Australia, or the United States itself," Peter Mandelson, EU Trade Commissioner told European Parliament's agriculture committee Tuesday.
The EU, which has been criticized by the United States, Australia and Brazil for the current stalemate in agricultural negotiations in the so-called Doha round, said it would not accept demands from trade partners to make further changes to its agricultural policy.
Last week, Mandelson suggested possible concessions could be made to the EU's Common Agricultural Policy, but quickly added such changes would not be made ahead of the Hong Kong ministerial.
The Group of 20 developing countries led by Brazil and Australia's Cairns group of 17 agricultural exporting nations have stepped up efforts to pressure the EU to make necessary reforms to liberalize trade in order to salvage global talks only two weeks away.
"Negotiations will continue in Hong Kong next month where Australia and our allies, including the Cairns Group will keep pressure on the EU and others," said Mark Vaile, Australian trade minister. "Hong Kong will be an important beachhead to allow us to finalize the round in 2006. We are now closer to fundamental reform of global agricultural trade than we have ever been, but it is on a knife-edge and could easily slip backward."
However, with a threat from Paris to veto any trade agreement that lowers farm payments and duties on food imports, the EU trade commissioner has been caught in a rift between major trading partners and EU agricultural producing nations.
Paris has said it will veto any trade agreement, unless other nations agree to reduce tariffs on industrial products and open services markets.
France, which has been largely blamed for halted talks, has attempted in recent weeks to shift the focus of negotiations away from French agricultural subsidies to development talks.
"There's been a lot of work put into the agricultural debate, but there's been very, very little in those areas that are of real concerns to developed nations," Lagarde, told the South China Morning Post Monday. "The goal of the EU is to have a balanced agreement; it's ludicrous to assume that a party in a negotiation is just going to give-give-give without ever receiving."
While Mandelson has been reluctant to show greater flexibility in agricultural negotiations and has been kept on a tight rein by France to prevent last-minute deals at the ministerial next month, he lambasted Paris Tuesday for halting talks and portraying the EU as less than eager to make concessions.
"With its criticism, France has done no favor to itself or to the EU," said Mandelson, in an interview with German daily Berliner Zeitung. "In this way, they (the French) have given the impression that they are the single European break (on progress), while other EU countries were ready to make more concessions."
Due to staunch French opposition, developing and agricultural exporting countries have increased the pressure on the EU to make further reforms on its farm policy, according to the EU top trade envoy.
"The fronts and spheres of interests are more complicated. Big agricultural players in the world market, such as Brazil, Australia, Canada and the U.S. are now flexing their muscles and demand a complete liberalization of farm trade," said Mandelson.
Pascal Lamy, head of the World Trade Organization, has called for a new "negotiating spirit" among trade partners. Lamy urged trading partners to make further progress on negotiations, especially in critical areas such as agriculture, market access and services in order to help expand opportunities for the developing world.
"What is already on the table can translate into a good result for development," Lamy said. "It would certainly be disastrous if what we have disappears because we fail to move the negotiations forward. The overall goal is to ensure that the package stays on the table and translates into real benefits at the end of the round - benefits for developing countries and least-developed countries, for small economies and for land-locked developing countries."
Lamy, who submitted a draft text for the upcoming ministerial meeting in Hong Kong on Saturday, has said in recent days next month's meeting will be a review of current progress made in the Doha round. Lamy has also said negotiations will have to continue on through 2006.
