G20 launches final attempt to meet deadline for world trade

World leaders launched a final, desperate attempt yesterday to broker a deal to free up world trade and drag millions of people out of poverty and disease.

Ministers of the seven richest countries and many of the most populous developing nations called on all countries to return to the negotiating table after the humiliating failure of the World Trade Organisation.

The current round of talks, launched in Doha in 2001, collapsed in acrimony in September in the Mexican resort of Cancun, apparently shattering any hopes of hitting the deadline for December next year.

But yesterday in Morelia, a Mexican city 1,000 miles from Cancun, the Group of 20 (G20) - 19 industrialised countries plus the European Union - urged the WTO's 148 country members to "re-energise" the talks. It said, in a statement, after the two-day meeting: "We are committed to giving impetus to the multilateral trade approach as one of the most effective ways to promote global growth, reduce poverty and ensure the benefits of globalisation are shared by all.

"We call on all WTO members to quickly re-energise the negotiation process toward the fulfilment of the Doha development agenda, recognising that flexibility and political will from all are urgently needed."

The plea for flexibility may be aimed at the European Union, the Japanese, and the Koreans, whose insistence on the launch of new talks on issues such as new rules for foreign investment, were blamed for the failure of Cancun.

The United States, which was also blamed for not acquiescing to a demand in Cancun by African countries to cut their cotton subsidies, pledged to work with poorer nations. John Snow, the US Treasury Secretary, said: "At this conference, I sensed a renewed interest in restarting and re-energising trade talks."

Ed Balls, the chief economic adviser to the Treasury who was standing in for Gordon Brown, said the failure to secure a new trade round posed a "real threat" to the sustainability of the economic recovery.

"We have to take action to secure a new multilateral trade round ... to tackle the waste of the Common Agricultural Policy, and the scandal of agricultural protectionism," he said.