Trade breakthrough close, says upbeat Chancellor

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Gordon Brown heralded an imminent breakthrough in the stalled talks on a new world trade deal, saying a compact could be agreed by the end of the year.

In a move that will put his credibility on the line, the Chancellor gave an upbeat assessment on the state of the negotiations just three months after they collapsed amid bitter acrimony.

He said the world's leading trading nations were "fired up" by the prospect of clinching a deal that could boost the global economy by $300bn. His optimism was echoed by Henry Paulson, the US Treasury Secretary, who said the world's largest economy was prepared to "go further" in offering concessions as long as others came forward.

However, trade experts warned against a repeat of the build-up of hopes over the summer that ended in failure at the G8 summit in St Petersburg in July.

Delivering a news conference after a meeting of the key policy committee of the IMF, Mr Brown said: "I am more optimistic as a result of the discussions we have had over the weekend. We are fired up as a group in wanting both a conclusion to the trade round and a successful outcome, and I believe that is sending a message right across the world.

"I have never had a discussion at all my years coming to the IMF meetings that was so determined to bring the talks to a successful conclusion, so aware of the risks coming from rising protectionist pressures, and so determined that we want not only an early resumption of the negotiations but a successful and ambitious outcome by the end of the year."

He said Pascal Lamy, the head of the World Trade Organisation - which hosts the talks - would be able to make progress by the end of the year. "I believe he will be in a position, with the enthusiasm but also the determination expressed today, to move negotiations forward," Mr Brown said.

But as he spoke, Kamal Nath, the Indian commerce minister, poured cold water on the chances of a breakthrough, saying too many Indians scraped a living from the land for India to accept opening up its market further to imports of farm goods.

"There is no question of India making concessions at all where agriculture is concerned because our issue is subsistence," Mr Nath said. "As I have said before, we are willing to negotiate commerce but not subsistence."

In its communiqué, the International Monetary and Financial Committee of 24 key countries said it was "deeply disappointed" by July's failure.

The WTO said any commitment by finance ministers to throw their weight behind the talks was "extremely welcome".