With only 10 weeks left until an interim deadline expires to achieve formula cuts on agriculture and industrial tariffs in the so-called Doha round, head of the World Trade Organization Pascal Lamy called on key trading partners to make necessary movements or risk achieving a "cheap round."
"All key players will have to move," said Lamy, in a speech at the Institute for International Economics in Washington. "And the good thing is that all of them have said they will move "in concert." All this makes me believe we could soon start to see the shape of a final deal."
Trade ministers decided at the conclusion of the World Trade Organization ministerial in Hong Kong to reach agreement on formula cuts on industrial tariffs and services and to increase agricultural market access by April 30 in order to reach a successful round by the end of 2006.
"We can now build on the elements to achieve an ambitious result in agriculture, but the road ahead is still full of potholes," warned Lamy.
Lamy said trade ministers had made more progress than the Uruguay Round – the last round of multilateral trade talks – but negotiators had much more work to complete in order to narrow the gaps in many areas especially agriculture and industrial products.
The United States confirmed Friday plans to meet with European Union counterparts next week to make progress on talks.
"We hope to have good discussions on the Doha negotiations and on bilateral issues," said Neena Moorjani, spokeswoman for the U.S. Trade Representative office.
Top negotiators from the five-interested parties, which include the United States, EU, Brazil, India and Australia, plus Japan, are also expected to meet in London between March 10 and 12 hoping to hammer out deals ahead of the April 30 deadline.
Lamy said ministers in Geneva have been working out formulas and drafting language to narrow existing gaps in negotiations on industrial products and agriculture since the beginning of this year.
The United States and the European Union have been at odds over how to break the impasse in global trade talks. Last month in Davos, Switzerland roughly 30 trade ministers agreed at the sidelines of the World Economic Summit to move forward on all three areas of negotiations simultaneously in order to meet the domestic demands of key trading partners.
While the blocking issue in the round has been agriculture, issues like the reduction of industrial tariffs and services have become front-and-center through the urging of emerging developing countries and the EU. Lamy said that the Group of 20 developing nations — led by Brazil and India — would need to move on industrial tariffs and services, the United States would have to move on domestic support and the EU would have to move on agricultural market access in order to make sufficient progress.
Earlier this week, congressional members voiced concern over the lack of progress made by the EU to forge ahead in negotiations.
"Our trading partners must realize they must give in order to get," said Sen. Max Baucus, D-Mont., ranking member of the Senate Finance committee during a congressional hearing on U.S. trade policies Thursday. "We've already offered our trading partners quiet a lot, especially on agriculture and I believe it's high time that they followed suit."
Chairman of the Senate Finance committee Sen. Charles Grassley, R-Iowa warned that Congress would "not accept any agreement that fails to provide meaningful market access for U.S. agricultural products in developed and developing countries alike."
U.S. Trade Representative Rob Portman said that despite some progress made in Hong Kong to end export subsidies by 2013, other trading partners have not "match(ed) our offers with equal ambition."
The United States has been adamant that agricultural market access is the key to unlocking the round and has repeatedly called on the EU to make further movements in order to break the impasse in trade liberalization talks.
"We expect significant progress in harmonizing domestic support for agriculture and then we have our manufacturers and service providers that we have to look out for," said Grassley, during the congressional hearing.
The EU, on the other hand, has argued that it will not make further movements on liberalizing agricultural market access, if it does not receive concessions from other trading partners on industrial products.
Brussels have been calling on emerging developing countries, including India and Brazil to show greater flexibility in revising their offers on industrial tariffs and services.
"It is clear…that there is a lot to be done if members are to conclude the round by the end of this year. The workload is formidable but doable, provided all members are ready to apply the necessary political energy," said Lamy.
