The United States' insistence that any new global trade treaty allow it to increase the amount of subsidies it pays American farmers is "frankly inconceivable," a key WTO official said Monday in an uncharacteristically stark assessment of the organization's moribund round of negotiations.
Dispensing with diplomatic niceties, Crawford Falconer, the World Trade Organization's top agriculture negotiator, also said the U.S. and the European Union needed to budge from their entrenched positions on import tariffs for farm produce, and called on all of the WTO's 150 members to make a clean break with nearly six years of repetition and failure.
U.S. officials in Geneva and Washington said they were still reviewing Falconer's 26-page "challenge" paper, which said it was now or never to deliver on a treaty aimed at adding billions of dollars (euros) to the global economy and lifting of millions of people out of poverty through free trade.
"This is not a passive observation or a series of 'dumb questions.' We are well past the time for that," the New Zealand ambassador said. "It is a matter of admitting the objective facts staring us in the face. If we do not get serious momentum over the next few weeks _ I hesitate to say months _ we will either fail or we will put this whole exercise in the freezer for some considerable time until a better generation than us can thaw it out."
The talks known as the Doha round have struggled since their inception in Qatar's capital largely because of wrangling between rich and poor countries over eliminating barriers to agricultural trade, which developing nations say prevent them from selling their farm goods abroad and developing their economies.
Having already missed countless deadlines, negotiators are now aiming at a year-end date for completing negotiations. But they concede that any treaty will be much harder to conclude after the expiration of U.S. President George W. Bush's authority to send trade deals to Congress for a simple yes-or-note vote without amendments. After the end of June, Congress will be able to pick any agreement apart line by line, making it more difficult for the administration to offer WTO concessions.
"It is frankly inconceivable that the U.S. will come out of this negotiation with an entitlement to spend more on overall trade distorting domestic support than it had when it came in," Falconer said of an October 2005 proposal by the Bush administration to limit its farm subsidies to US$22 billion (euro16 billion) annually.
While the U.S. has held firm on its offer, it actually spent well below that in trade-distorting farm subsidies last year. Washington has refused to provide the WTO with an overall figure since 2001, but estimates place the U.S. handouts last year at a level between US$14 billion and US$15 billion (euro10.3 billion to euro11 billion), according to the international aid agency Oxfam, which campaigns on behalf of the trade interests of poorer nations.
Falconer said he did not believe "there is the slightest chance" that other WTO members would embrace the U.S. position. "My guess is that, if we end up with an agreement at all this year, the (U.S. subsidy) number will be in the teens."
The Bush administration is suggesting some modifications in subsidy programs as part of its proposed farm bill, but several countries have criticized Washington for refusing to make a bold enough offer to prompt concessions from others.
Negotiators for the 27-nation European Union and other potentially lucrative farm markets say they will resist further cuts in tariffs on American beef, poultry and other products until the subsidies are reduced. West African countries have said they will reject any deal that does not adequately address handouts to American cotton growers.
While Falconer criticized the U.S.' defensive position on subsidies, he said movement on tariffs was needed from both Washington and Brussels, which are currently proposing average cuts that differ by roughly 27 percent.
Falconer's solution, an average tariff cut of about 52.5 percent for rich countries, would roughly be in line with an offer by Brazil, India and other developing nations. While the U.S. rejected that proposal in November 2005, the EU said it might be willing to move close to the 54 percent cut called for, but nowhere near the 66 percent level the U.S. has demanded.
"The center of gravity is ... squarely between the U.S. and the EU positions," Falconer said. "This late in the negotiation, it is a reasonable presumption that neither of those positions will in the end actually prevail. So I would have thought that it is a reasonable prediction from any dispassionate observer that the center of gravity is actually somewhere inside those parameters _ or not at all."
Falconer also called for an end to the unrealistically high number of tariff exceptions that some governments are seeking for their farm sectors. While he didn't single out these countries by name, his criticism was directed at the "sensitive product" exceptions demanded by the EU, Switzerland, Norway and others, and the "special product" clause most fervently championed by India.