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WTO Talks Still Deadlocked After Overnight Haggling

HONG KONG - Negotiators emerged from a night of haggling at World Trade Organization (WTO) talks on Saturday no closer to breaking their deadlock over farm subsidies and plans to bolster the exports of poorest nations.

The United States put a brave face on the floundering talks in Hong Kong, hoping for a minimal accord in order to call the meeting a success and keep alive hopes of sealing a deal on a new global trade treaty early next year.

"As we approach the final 24 hours of the negotiations we have a very large opportunity to put together an outcome that would be extremely positive for development ... it is just beyond our fingertips," said Deputy Trade Representative Peter Allgeier.

But diplomats said that when negotiators emerged bleary-eyed from a private "green room" discussion at 5 a.m. there was still no agreement on setting a date for ending farm export subsidies because of resistance from the European Union.

The EU says the United States, Australia, Canada and New Zealand must agree to reforms of their farm export systems first.

The latest draft text on setting an export subsidies cut-off, seen by Reuters, still had the year ��' in brackets.

"It's a sad day when we're getting excited about an end-date in brackets," said Bob Stallman, head of the United States' biggest farm group, the American Farm Bureau Federation.

An official at the talks said the EU was "unhappy with the language in the draft on export competition and domestic support."

The official also said the development package was still "up in the air."

Supporters of a trade deal say it could boost the global economy and lift millions out of poverty, but detractors say it will only bring more profits for rich nations and their companies at the expense of the developing world.

The 149-nation WTO lowered its expectations for Hong Kong weeks ago because of a continuing impasse in the negotiations, launched four years ago in the Qatari capital, Doha.

The WTO needs a blueprint for concluding the Doha round within the first few months of 2006 if it is to have any hope of finalising a treaty by the end of the year.

EU "Arrogance"

The EU has taken much of the blame for the deadlock because of its refusal to offer reduced tariffs on farm goods imports without market access concessions for industrial goods and services from developing countries.

"Agriculture remains the key and market access remains the key to agriculture itself," Allgeier told a news conference.

But the U.S. farm group's Stallman was more blunt: "It's the height of arrogance that the rest of the world should say 'wow'."

The relief group ActionAid said the EU's deal in Brussels on its long-term budget, clinched in the early hours of Saturday, could put European Trade Commissioner Peter Mandelson under renewed pressure to make concessions in Hong Kong.

The budget agreement included a call for the EU's executive Commission to publish in 2008/09 a review of all aspects of EU spending, including farm subsidies.

France, the biggest beneficiary of EU farm subsidies, has insisted all along that the level of agricultural payments must remain pegged until 2013 under a deal reached three years ago.

"Now Peter Mandelson has no excuse for not making serious offers to reform the EU's damaging agricultural subsidy regime at these trade talks," ActionAid said in a statement.

The United States, for its part, was still resisting demands in Hong Kong to give duty-free and quota-free access to some goods from many of the world's least-developed countries.

On Hong Kong's streets, about 100 South Korean protesters shouted "Shame on the EU" outside the building housing the EU consulate and thousands were expected to stage an anti-free trade protest later in the day.

Police beefed up patrols after warnings by Korean protesters that they planned more aggressive demonstrations before the WTO talks end on Sunday. The Hong Kong government said it expects more than 10,000 people to join Sunday's march.

On Saturday Korean protesters vandalised the outside of the U.S. consulate, spray-painting anti-WTO slogans on the walls, and stormed a building housing their own consulate, where they staged a sit-in late into the night.

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