EC resists Bush over deal on subsidies

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WASHINGTON - George Bush, anxious to proclaim a breakthrough on world trade before the US presidential election, has written to EC leaders warning of 'escalating' trade conflicts unless the Community accepts the latest US proposals on farm subsidies, writes John Lichfield.

'We have stretched as far as possible to meet the EC's concerns,' President Bush says in a letter to EC leaders before today's Community summit in Birmingham. 'The negotiators have done all they can. Now we need the political will.'

'If we seize this opportunity we will be on the path to renewing the world trading system, restoring market confidence and fuelling economic recovery. If we do not, we face the spectre of an escalating trade conflict.'

EC and US negotiators made some progress in Brussels last week but failed to solve disputes over European subsidies on oil seeds and farm exports which have held up a new Gatt (General Agreement on Tariffs and Trade) treaty for nearly two years. The EC wants the US to open up its services sector to non-US bidders. Mr Bush, trailing badly in the polls, has offered his international prestige and experience and his commitment to freer world trade as two of his few positive arguments for re-election.

White House officials and European diplomats in Washington say the administration is desperate to parade a Gatt agreement before the 3 November election. Several European governments, especially the French, are said to be determined to wait until after the election in the hope of negotiating a more favourable deal with an administration led by Bill Clinton.

A New York Times-CBS poll, taken after Sunday's first presidential debate, showed Mr Clinton maintaining a 13-point lead over Mr Bush. The poll of 854 registered voters gave Mr Clinton 47 per cent and Mr Bush 34 per cent. The independent candidate, Ross Perot, widely seen as 'winning' the debate with his cracks about paralysis in Washington, rose modestly to 10 per cent.