Japan hoping to mediate long-stalled WTO trade talks

TOKYO, July 18 Kyodo - Japan will try to act as a bridge between developed and developing countries when ministers from about 30 major trading powers fly into Geneva this weekend in the hope of achieving a breakthrough in the long-stalled Doha Round of trade liberalization talks.

It is widely believed that the gathering will provide the last opportunity for a while to strike a deal on a new framework to further free up global trade under the auspices of the World Trade Organization.

Almost all WTO negotiators are aware that reaching an outline deal by the end of this year is crucial, despite differences in their positions.

If they fail, the talks, launched in the Qatari capital in November 2001, will likely be put on ice again for some time as there will be a change in the U.S. administration in January next year.
The political landscape of other key players is also expected to change, including the European Commission and India, which would make it difficult for the negotiations to be kept on track.

Against this backdrop, WTO Director General Pascal Lamy has called the make-or-break meeting, starting Monday. Lamy's current term as head of the Geneva-based trade body will end September next year.

Akira Amari, Japanese trade minister, told reporters earlier this week that an important task for Japan at the meeting is to prepare the ground for a compromise between industrialized and developing countries, in addition to protecting the country's own national interests.

''In fact, we have received a request of that type from Director General Lamy,'' Amari said. ''As a member of the Asian community, I believe Japan could narrow the distance between developed countries and Asian emerging economies.''

There has been no real multilateral ministerial meeting aimed at reviving the beleaguered Doha Round framework after talks between the so-called Group of Four influential trade powers -- the United States, the European Union, India and Brazil -- collapsed in Germany in June 2007.

Over the past few months, senior officials from the WTO's 152 member economies have mainly worked on sorting out dozens of complex technical formulas regarding how to set tariff cuts and treat farm subsidies.

Last week, the WTO circulated new negotiating texts for the most sensitive areas of agriculture and industrial goods that will serve as the basis of discussions for the envisioned deal.

Although the differences between developed and developing countries remain wide, Lamy, a former European Union trade chief, took a gamble by calling the meeting, believing that the rest will depend on political decisions.

The Doha Round covers a range of areas other than agriculture and industrial goods, including services, anti-dumping rules and development.

Many experts believe that the key component for success in advancing the multilateral talks rests on whether the United States will agree to greater cuts in its farm subsidies as requested by developing countries.

Developing countries are unlikely to make any major compromises over the demand from rich countries for improved market access for their industrial exports if Washington does not affirm a new commitment to scale down its special treatment for U.S. farmers.

For Japan, the handling of so-called ''sensitive products'' in the agriculture negotiations will be paramount.

The latest text for the farm negotiations, delivered by New Zealand's WTO ambassador Crawford Falconer, who is chairing the agricultural talks, states that 4-6 percent of all farm products will be exempted from substantial tariff cuts.

Japan, in cooperation with Switzerland and other farm-product importing countries, has been arguing that sensitive products should account for at least more than 10 percent of the total.

To protect domestic farmers from cheaper imports, Japan currently levies a tariff of more than 200 percent on 7.6 percent of the total, including rice, butter, wheat and sugar.

With regard to non-farm goods, Japan's position is basically in line with other major rich countries who are urging developing countries to slash customs duties by more than the maximum level of 19-26 percent proposed in the negotiating text for industrial goods.

From Japan, Economy, Trade and Industry Minister Amari and Agriculture, Forestry and Fisheries Minister Masatoshi Wakabayashi will take part in the meeting.

They are also scheduled to hold a series of bilateral meetings with their counterparts over the weekend in Geneva.

No concrete timetable has been set for the multilateral meeting.
But Japanese officials say that the meeting is expected to run for about a week.

The ministers from about 30 trading powers, including Brazil, India and the United States, will hold a meeting every day back to back with a session of the Trade Negotiations Committee, which will be attended by representatives of the WTO's 152 members, they said.

It will be an important milestone in the negotiations if the ministers strike a basic deal.

Lamy said the chance of reaching an outline deal on agriculture and industrial goods is greater than 50 percent, when he called the ministerial meeting late last month.

But even if the meeting is successful, it will not be the end of the long road as uncertainties will remain.

An outline deal would still need to be translated into more specific terms and conditions for world trade and they would have to be agreed by a larger number of WTO members by the end of this year.