SHARM EL-SHEIKH, Egypt (Reuters) - The head of the World Trade Organization (WTO) expressed fears over the state of talks to liberalize global commerce on Saturday as trade ministers tried to thrash out the tough issue of agriculture.
The United States urged the European Union to reform its $46.76 billion a year farm policy to give the Doha Round of trade talks a new lease on life and delegates said a fresh paper on agriculture could emerge from the WTO in July.
"The director general (World Trade Organization chief Supachai Panitchpakdi) explained to ministers that he was very worried about the state of play. He made it very clear that time was running out," spokesman Keith Rockwell told reporters, adding the WTO chief had been "blunt and direct."
The June 21-22 Sharm el-Sheikh meeting of around 30 ministers is key in the run-up to a ministerial meeting of the 145-member WTO in Mexico in September, whose success could decide whether the trade round finishes on time in 2004.
The WTO has already missed several deadlines, including how to take the farm talks forward and for a system to give poor states more access to life-saving drugs by waiving patent rules.
Supachai said later that the talks on agriculture, on which the ministers spent two grueling sessions, helped narrow gaps and achieve a better understanding of each country's stance.
Progress in talks on the $500 billion world agriculture market is vital to the trade negotiations as it is one of the main areas seen in need of greater liberalization.
It is a hugely difficult issue for the EU, which subsidizes its farmers heavily, but exporters such as Canada and Australia, as well as developing nations, want movement from Europe and Japan in order to agree on liberalizing other areas.
Highlighting the problems, the Sharm el-Sheikh meeting took place just days after EU farm ministers abandoned efforts to agree on overhaul of agriculture policy until next week.
DRUGS PROBLEMS
Supachai said further farm trade talks are needed to maintain the ambition for as wide a deal as possible but, apparently referring to the EU, take into account political sensitivities.
U.S. Trade Representative Robert Zoellick was more frank.
"While we've been discussing ways to move the negotiations forward, it's become clear that whether we move ahead or get stuck very much depends on the European Union," he said.
The WTO is already considering a draft paper on how to take the farm talks forward. The spokeswoman for European Trade Commissioner Pascal Lamy said another document would be produced by mid-July, when a further WTO ministers meeting is planned, to try to achieve more of a balance between countries' positions.
Rockwell said the WTO chief had also urged countries to deal with issues such as integrating environmental concerns into trade matters and a system to afford protection to certain well-known types of food such as Basmati rice or Darjeeling tea.
As well as farm reform, the trade ministers will discuss a range of topics which have become bogged down at the WTO, such as a system to waive patent rules to let poor nations with no drugs industry import cheap, usually generic, drugs for diseases like AIDS, tuberculosis and malaria.
This is one of those areas close to the hearts of developing nations, for which the Doha Round is supposed to bring greater benefits from the world trade system, as well as leading to greater overall liberalization of global commerce.
But the United States, which has a powerful drugs industry, has blocked a drugs deal, accepted by all other states.
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