Progress on a new World Trade Organization agreement is stalled over Europe's inability to reform its common agricultural policy, International Trade Minister Pierre Pettigrew said Sunday.
In a conference call from Sharm el Sheikh, Egypt — where 30 trade ministers met on the weekend — Mr. Pettigrew said the entire future of the so-called Doha Round of WTO talks hangs on the agricultural sector.
"On agriculture, we had a long discussion but made little progress," Mr. Pettigrew said.
"Negotiations are essentially stalled while we wait for the Europeans to complete their internal reforms and to see whether that will allow them to bring some flexibility to the negotiating table."
Agricultural exporters — both in the developed world and in the developing world — are demanding that Europe and the United States dramatically reduce their subsidies, which distort world markets and impede development in the Third World.
Without a satisfactory deal on agriculture, Mr. Pettigrew said, there can be no tradeoffs on industrial tariffs and market access in non-farm productions, nor in areas such as investment, competition policy and procurement, which are of keen interest to both the Europeans and the Americans.
The EU's agriculture ministers failed again this week to forge a deal and French President Jacques Chirac rejected proposals on the table.
Australia's Trade Minister Mark Vaile said he is concerned that the French President is watering down the proposals for agricultural reform within the EU.
"We continue to encourage as much reform as possible in the EU as far as the common agriculture policy is concerned," Mr. Vaile told reporters in this Red Sea resort.
The meeting of ministers, including U.S. Trade Representative Robert Zoellick and EU Trade Commissioner Pascal Lamy, is the first since a series of deadlines for the Doha Round of World Trade Organization talks were missed.
It is also part of the runup to a full WTO meeting in Mexico in September, which could decide if the round finishes on time at the end of 2004. Prior to that meeting, Mr. Pettigrew will host another session in Montreal at the end of July.
But Mr. Pettigrew suggested that countries won't be railroaded into accepting a less than ambitious agricultural package merely to meet a deadline.
"The right deal is better than a quick deal," he said.
Mr. Pettigrew said some progress was made on another key sticking point between the developed world and the Third World: the right of countries to produce generic copies of brand-name pharmaceuticals in order to meet national health emergencies.
"I'm hopeful we will be able to settle this issue soon," he said.
U.S. trade ambassador Mr. Zoellick "is working very closely with the industry to find a long-term solution and I have found him positive about the work that has been done with the industry in the last few months," he added.
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