After years of talking, the world’s top trade leaders broke off their debate in Switzerland after the United States couldn’t agree with China and India on opening markets and subsidies, drawing disappointment and some rebuke from European Union officials. The World Trade Organization talks on the conclusion of the Doha round broke off in Geneva on July 29 after nine days amid differences, although officials said the talks could resume autumn. Forty ministers were unable tie up a compromise package aimed at liberalising global trade after China, India and the US failed to agree on the farm import rules. The talks launched seven years ago in Doha were seen as crucial to future world trade - aimed as they were at remedying inequality so that the developing world could benefit more from freer trade. The EU had appealed to delegations to find an agreement, with EU Trade Commissioner  Peter Mandelson warning of a “terrifying prospect” if the talks were to fail. His appeal came as opinions appeared divided among the WTO parties over the issue of opening of agriculture markets, which had appeared to have been resolved in a compromise reached earlier that called for cutting limits of European farm subsidies by 80 percent and US payments by 70 percent. The proposal also involved cuts in tariffs on agricultural imports and on industrial goods. But a row escalated when India and China refused to further open their agriculture markets, not wanting to entirely weaken the applicable mechanisms protecting their farmers. The two countries, saying they were speaking for some 100 developing countries, argued for a customs arrangement to protect farmers in poor countries against excessively high food imports. “The talks have taken a very disappointing turn,” said US trade representative Susan Schwab, while German delegation leader Berndt Pfaffenbach said: “It came as a surprise, and we failed to finalise things today because of major differences which did not stem from Europe.” “An agreement at the multilateral trade negotiations would have been an important boost at the right moment for the world economy,” said Pfaffenbach. He said the German government would work insistently on a resumption of the talks as soon as possible. “We cannot afford any lengthy idle period,” said Pfaffenbach, saying that all WTOmembers would benefit if markets were opened. Ludwig Georg Braun, president of the Federation of German Chambers of Industry and Commerce DIHK, called the breakdown a “harsh setback” for business. “A major opportunity has been wasted, especially considering that the world economy is clouding over,” he said. Amid the impasse, Indonesian Trade Minister Mari Pangestu said nobody wanted the current WTO talks to be broken off, while Brazilian Foreign Minister Celso Amorim urged the WTO participants to shoulder their political responsibility. Schwab accused the two countries of undermining the hard-fought compromise package, saying the US had made great concessions especially in regard to removing its cotton subsidies. Some WTO representatives sympathised with China and India, saying that because they had so many poor to care for, agricultural and food security in these countries had to be strengthened, not weakened by cheap imports. A large portion of poorer developing countries supported the Indian-Chinese position. The Doha Round, named after the Qatari capital where it began in November 2001, has been deadlocked for years. The impasse can be broken only by unanimous agreement between all 153 member countries. The Geneva talks had been described as a lastditch attempt to break the deadlock.

EU's time to assess

The European Commission expressed “profound disappointment” over the collapse of the WTO talks and called for renewed efforts to break the years-long stalemate. Commission President Jose Manuel Barroso said that the EU had worked “for a fair and balanced deal that would have created a win-win situation.” “We did absolutely everything we could to reconcile the different views and find compromise,” Barroso said in a statement. Barroso said he would recommend that EU member states assess the outcome and “prepare for reengagement with our major partners.” Nordic countries also expressed dismay. Norwegian Foreign Minister Jonas Gahr Store, who attended the talks and was also assigned to help broker some issues on patent matters by Lamy, said he was “disappointed over the failure to reach an agreement.” “We came a long way towards a new agreement. But on critical issues the gaps between the key nations was too big,” Store added. Swedish Trade Minister Ewa Bjorling said “all parties have to take their responsibility and see how the Doha round can carry on.” Sweden will continue to press for free trade “but did not expect fast results,” she added. Finish Trade and Development Minister Paavo Vayrnen said he was “disappointed,” over the breakdown saying that “during roughly a week negotiators achieved progress on several issues.” He added that “Finland did not lose anything specific but as a EU country with an open economy we are very interested in making world trade more open.” Store earlier was more hopeful after a compromise seemed to have been reached and said Norway was willing to go along with the deal, although Norwegian farmers feared the proposed tax cuts will mean the end of their industry. The ramifications of the failure were felt around the world. Japanese Prime Minister Yasuo Fukuda said he was unsatisfied an agreement couldn’t be reached. “It is very regrettable that an accord on modalities was not reached at a WTO ministerial meeting despite more than a week of all-out effort by ministers,” Fukuda said in a statement. Fukuda vowed to continue efforts to reach an agreement by collaborating with other WTO members. “Although the chance of concluding the Doha round of free trade talks by the end of this year has receded, Japan, with other member economies, will seriously consider how to promote talks, based on achievements in previous negotiations,” Fukuda said. Japanese Chief Cabinet Secretary Nobutaka Machimura criticised China and India by saying they were only concerned about their own benefits. Machimura urged the two emerging economies to instead consider what benefits a trade deal could bring for the global economy as a whole.