WTO's Lamy: give Doha negotiators more flexibility

World Trade Organisation (WTO) Director-General Pascal Lamy speaks during a business meeting organised by the Confederation of Indian Industry (CII) in New Delhi September 4, 2009.

GENEVA (Reuters) - G20 leaders must give their negotiators more flexibility to let them reach a global trade deal and conclude the long-running Doha round, the head of the World Trade Organisation said on Monday.

Renewed promises by leaders from the Group of 20 major economies at their Pittsburgh summit to reach a deal were not enough, WTO Director-General Pascal Lamy said. "It is now incumbent upon them to 'walk the talk'," he told the WTO's public forum.

The G20 leaders had backed an intensive programme over the next three months to close the remaining gaps and then assess the possibility of wrapping up a deal next year, as targeted, said Lamy.

Leaders and ministers have made a string of promises this year to conclude the Doha round in 2010, but negotiators are expressing frustration that their governments are not giving them the flexibility needed to reach a deal.

The Doha round is already the longest set of multilateral trade talks in history. It was launched in late 2001 with the goal of helping poor countries to prosper through trade and has suffered many missed deadlines and setbacks.

However, David Shark, deputy U.S. ambassador to the WTO, said the leaders' reaffirmation of their commitment to a 2010 deal had given direction to negotiators, and he dismissed comments that Washington was cool on a deal.

"We are fully committed to a successful conclusion of this round... We're committed to concluding the round in the year 2010," he told a panel discussion at the forum.

China's WTO ambassador Sun Zhenyu also said the G20 had sent an important signal to negotiators. "That shows this is at least already one of the priorities for leaders to consider in their agenda," he told the panel.

But Sun said it would be difficult for Beijing to improve its offer on cutting tariffs any further, as there would be little public support due to trade measures targeting China such as this month's increase in U.S. tariffs on Chinese tyres.

For the same reasons Sun said China would not join a deal to eliminate duties entirely in the chemicals sector, something sought by the United States in a Doha agreement.

GOING GLOBAL

Lamy said a Doha deal, which would cut farm subsidies and industrial and agricultural tariffs, would help to tackle the economic crisis by providing a bulwark against protectionism as well as helping developing countries hit by the global recession.

Under existing WTO agreements, average tariffs could double from current levels, he said. "The Doha Round of trade negotiations would not only open new markets for exporters, but also curtail some of the existing margin of manoeuvre that could take the world backwards," he said.

WTO monitoring had shown that protectionism so far had been of "low intensity", with many measures but of limited impact, he said. But trade policymakers cannot afford to be complacent as rising unemployment lagging an economic recovery would boost protectionist pressures, he said.

States should fight the temptation to "go local", he said.

"We should continue 'going global'... for the simple reason that many consumers have seen their purchasing power decline, and are in need of cheaper, more competitive, goods and services, and not more expensive ones produced behind a national tariff wall," he said.

(Editing by Tim Pearce/David Stamp)