WTO envoys despondent at receding Doha prospect

Pascal Lamy, Director General of the World Trade Organization (WTO) attends a session at the World Economic Forum (WEF) in Davos January 28, 2010.

GENEVA (Reuters) - Gloom and frustration pervaded the World Trade Organization on Monday as the prospects of completing a new global commerce pact this year receded.

The WTO's 153 members had agreed to take stock at the end of March on whether the eight-year-old Doha round could be concluded this year, as called for by political leaders.

But WTO Director-General Pascal Lamy told the general council there were too many gaps and uncertainties in the negotiations to bring in ministers at this point.

Lamy said the decision on whether the Doha talks could be completed this year was a political one to be taken by ministers.

"Given where we are right now, it is also clear, however, that the end of March is too early for that," he said in comments confirming a Reuters report last week.

The decision prompted an outpouring of gloom by delegates, even as they pointed to advances in some technical aspects of the multifaceted negotiations.

DESPONDENT

Egypt said the talks had made no tangible progress since an abortive meeting of ministers in July 2008, and were now stuck in an abyss between rhetoric and reality.

India's WTO ambassador, Ujal Singh Bhatia, told the council the prospects of reaching a deal in 2010 were now in question.

Mexico's ambassador, Fernando de Mateo y Venturini, speaking in English, said he had learnt a new word last week -- "despondent" -- though maybe "angst" was more appropriate. Gaps between countries were now wider than in July 2008, he said.

Unless negotiators worked to narrow them and produced a deal for ministers to close, they risked facing the alternatives of suspending the talks or seeing them fade away, undermining the global trading system, he said.

Lamy said WTO members would take stock of the Doha talks on March 29 and 30, after which ambassadors and senior officials from national capitals would report back to ministers and discuss the next steps, which would need political guidance.

To prepare for the stocktaking and identify the outstanding gaps, the senior ambassadors who chair different aspects of the negotiations will prepare factual reports, while countries holding bilateral talks -- such as the United States and the three big emerging economies of Brazil, India and China -- will also report back, he said.

A Doha deal would cut rich country agricultural subsidies that distort global farm trade, open up emerging economies' markets for industrial goods and help developing countries prosper through more trade.

But the continuing rise in unemployment, even as the world pulls out of the economic crisis, is making many countries have second thoughts about opening up to more trade, while Brazil, one of the keenest supporters of a deal, faces elections.

In the United States labour unions fear a trade deal could hurt jobs, even though the Obama administration is pointing increasingly to exports as a way of regenerating the economy.

Nepal said that least developed countries (LDCs) were paying the price for failure to reach a deal, and called for an "early harvest" -- a call which drew support from China.

This would involve agreeing on and implementing measures of direct concern to LDCs -- such as duty-free and quota-free access for their goods in other markets, big cuts in cotton subsidies and a deal to help them trade more by cutting red tape and corruption and improving infrastructure -- while the rest of the negotiations continue.

The council also agreed on people to head its main bodies in the coming difficult year, including Canadian ambassador John Gero to chair the general council and Nigerian ambassador Yonov Frederick Agah to chair the dispute settlement body, as forecast two weeks ago by Reuters. (Editing by Tim Pearce)