July 10, 2009 / 1:27 PM / 10 years ago

G8 injects new momentum in Doha Round push

GENEVA/ROME (Reuters) - The world’s most powerful countries have injected momentum into long-running negotiations over a new global free trade pact by setting a 2010 deadline.

Diplomats said they expected a full calendar of meetings between trade ministers and other officials in the coming months in response to the new target date for completion of the Doha round announced by the G8 plus leading emerging states.

“Things are going to be very busy,” said one developing country diplomat, who spoke on the condition of anonymity.

But some questioned whether the WTO’s 153 members were ready to make new offers to clinch a Doha Round accord, which would cut subsidies and import duties on traded goods and services and help developing states export more.

The communique from the Group of Eight rich nations plus China, India, Brazil, South Africa and Mexico signaled some high-level willingness to wrap up a deal that has stagnated over disagreements about how to treat certain industries and farmers.

Several negotiators said the United States and India, which caused a July 2008 WTO ministerial meeting to fail because of a disagreement over protections for poor-country farmers, needed to show they were willing to make new offers.

“The U.S. position is not clear yet, nor is the extent to which India can offer more,” said a trade official from a developed economy, who asked not to be named. Both countries have had a change of government since last year’s collapse.

U.S. BATTLE

Dan Price, the former White House’s lead player on Doha, said India’s move to host a meeting of trade ministers in early September was a positive sign.

“Past history is littered with good intentions and unfulfilled promises on Doha,” Price, President George W. Bush’s assistant for international economic affairs and now a partner with law firm Sidley Austin, told Reuters in Rome.

“The key point now is that all countries are going to have to make uncomfortable choices between now and next year. The date of 2010 is very welcome and it is very encouraging to see India hosting a mini-ministerial, as it will be them and the U.S. who will be the critical players.”

World Trade Organization Director-General Pascal Lamy has said that the Doha Round has been at least 80 percent agreed since its launch in the Qatari capital in November 2001.

While the negotiations have faltered at various points since then, the onset of global recession has garnered some enthusiasm for completing a deal that Lamy has estimated would give the world economy a $130 billion annual boost.

U.S. presidential politics may also influence future steps.

Traditionally there are a number of Democrats who oppose free trade deals and Obama is likely to need support from some opposition Republicans to approve a pact. Price said he would most probably want to do this before campaigning for mid-term U.S. elections later next year.

“Any election in any country complicates concluding Doha,” he said. “What will be crucial will be to see if the Obama administration will extend the necessary political capital on an issue that is so divisive within the Democratic caucus.”

Major breakthroughs on tricky issues including agricultural and industrial goods will be needed this year for a deal to be completed in 2010, WTO officials have said. The accord would also cover cross-border services and set new trade rules.

As in former WTO accords like the Uruguay Round, the Doha talks require full consensus among all negotiating partners and in all areas of the talks to be clinched.

Editing by Patrick Graham and Elizabeth Piper

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