Hewitt urges last-minute deal on world trade

NEGOTIATORS WERE working into the night to prevent opposition by both rich and poor countries from scuppering a deal to open up world markets.

NEGOTIATORS WERE working into the night to prevent opposition by both rich and poor countries from scuppering a deal to open up world markets.

Ministers from the 147 members of the World Trade Organisation were locked in talks over a deal that would form the basis for detailed negotiations on a new global agreement.

But a final draft triggered accusations by poor countries and anti-poverty campaign groups of a "stitch-up" by rich nations.

Countries were set a "drop dead-line" of midnight last night to agree a framework for negotiations - although hopes of wrapping it up on time were fading. Patricia Hewitt, the Secretary of State for Trade and Industry, said it was "most unlikely" a deal would be done before today. "But I am hopeful that we can agree on a framework across the WTO before the end of the weekend," she said.

She urged countries to sign up to an agreement despite mounting rumours of opposition from some of the world's poorest countries. "I hope that over the next 24 hours everybody will bear in mind that if we do not get a negotiating framework in place now, then work will stop for the next six to nine months," she said.

The US presidential elections in November and a reshuffle of European Commission portfolios in the autumn mean the world's two most powerful trading blocs will be without a trade chief until next year.

Ms Hewitt added: "We cannot guarantee that we will be able to pick up where we would have left off here."

Supachai Panitchpakdi, the head of the WTO, told reporters: "A number of delegations saw improvements, but I have to admit it hangs in the balance."

Ministers were handed a final draft yesterday morning by WTO officials who had worked overnight on Thursday to incorporate proposals by five of the world's most powerful trading blocs aimed at tackling the key issue of farm subsidies.

The 20-page blueprint called for the elimination of farm export subsidies and sets out other principles for reforming agricultural trade - a key demand by developing countries.

It also laid down guidelines for opening up business in industrial goods and services and for launching negotiations on a customs code, as the richer countries would like.

But the wording has run into criticism from both France, which says it goes too far in cutting farm aid, and from developing nations angered by a lack of progress in meeting their demands.

Observers at the WTO's Geneva headquarters said France had reaffirmed its objections to a deal that would see the elimination of all export farm subsidies during a four-hour meeting of European ministers.

However, France lost the support of Italy and Germany, which voiced its support of the plan ahead of the UK, which has traditionally been the most vocal advocate of reform.

Pressure groups said developing countries were angry that their concerns over issues such as market access and subsidies for cotton had not been taken on board.

Moussa Faye, a Senegalese campaigner with ActionAid, said African countries were angry that the contentious issue of cotton subsidies had been wrapped into agriculture.

The US pays $3bn a year in aid to its cotton farmers and countries such as Burkino Faso that cannot compete with subsidised American cotton are demanding reform. "There is no specific commitment to deal with cotton and that's not good enough," Mr Faye said. He said that "logically" West African nations should block the deal. "But the WTO operates in secret and there's a lot of pressurising and arm-twisting," he said.

Celine Charveriat, head of Oxfam's Geneva office, said the deal on offer was "unacceptable" for poor countries. "The text on agriculture does little to address the problem of export dumping, instead introducing dangerous loopholes for yet more subsidies from the US."

Consumers International, a lobby group, accused the rich countries of extending a clause that grants them protection against challenges to farm payments under WTO rules. The protection was meant to expire this year. "It is a licence for the big powers to break the rules," Robin Simpson, its senior policy adviser, said. "We call for immediate clarification."

Meanwhile Kenya and other members of the G90 group of poor states are resisting demands by rich countries that they should sign up to new rules on customs and import procedures aimed at stamping out corruption.

The issue, known as trade facilitation, was one of four so-called "new issues" that contributed to the collapse of the last major WTO summit in Cancun, Mexico, last autumn.