US optimistic on WTO talks if China leads concessions

WASHINGTON - The United States on Thursday expressed guarded optimism about trade talks next week aimed at rescuing the WTO Doha Round if China leads developing countries to make concessions.

By (AFP)

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Published: Sat 19 Jul 2008, 6:14 PM

Last updated: Sun 5 Apr 2015, 12:53 PM

US Trade Representative Susan Schwab said she was heading to the talks under the auspices of the World Trade Organization in Geneva "cautiously optimistic."

"Many of us feel a real sense of momentum," she said at a news conference, citing discussions with officials as they work to break the deadlock on the Doha Round, launched in the Qatari capital in November 2001.

But, she cautioned, "it's not the first time," recalling feeling the same way just before a similar effort -- talks between the US, the European Union, Brazil and India -- collapsed a year ago.

Schwab, who will lead the US team at a gathering of 30 ministers opening Monday, said the United States has "the intent and hope and expectations that there is a deal to be had."

"I think a deal is eminently doable ... it is doable next week," she said.

Still, emerging market economies must make "meaningful market-opening contributions" to achieve a successful outcome of the Doha Round, she said.

China, which joined the WTO in December 2001, just after the launch of the Doha Round, and has seen its exports explode under free trade, needs to show more leadership, Schwab said.

"China has a particular obligation to give back to the Doha Round" of WTO negotiations, she said, noting that China has reaped "hundreds of billions of dollars" since opening their trade system.

The US trade official said she has had "good conversations" with Chinese officials recently and "likes" to think that China is willing to work for a successful outcome.

"Without that contribution it is impossible to imagine a successful conclusion to the Doha Round," she concluded.

Schwab noted mounting resistance in developing countries to a tide of Chinese exports as they seek protection for their domestic sectors.

"China needs therefore to step up and play a leadership role," Schwab said.

The two economic powerhouses are at odds over the ballooning Chinese trade surplus with the United States. Critics in the US say that Beijing maintains its yuan currency undervalued to profit from an unfair trade advantage, an allegation Chinese officials deny.

Topping the agenda at next week's Geneva talks are agricultural and manufacturing trade barriers.

The industrialized countries are seeking greater access to developing markets for their manufactured goods, while in return developing countries want lower farm subsidies and agricultural tariffs in the developed world.

The third pillar of the Doha Round, services, will be discussed in a "signaling" conference aimed at paving the way for further negotiations, Schwab said, likening the negotiations to "three-dimensional chess."

She dismissed suggestions that the Doha Round was pressured by the USelection calendar and the lame-duck Republican presidency of George W. Bush, who leaves office in January after serving two terms.

"This is a round that will come together when it's ready to come together," she said. "With 152 members there is no good time or bad time to close a multilateral deal."

The trade chief said she has had intensive talks with lawmakers of the Democratic-controlled Congress and found strong bipartisan support for a deal, but cautioned: "We need to be able to bring back a package that has some balance between gives and gets."

"The US is willing to do our share and then some to get this done," she said, adding the US has "a very generous offer on the table."

With regard to the thorny issue of farm subsidies, Schwab noted the US proposed spending 60 percent less than its currently allowable rate.

However, critics of US and EU farm subsidies say developed countries are failing to promote a freer flow of food to developing countries.

"In its first 13 years in existence, the WTO has failed to deliver development results for the vast majority of low- and middle-income countries," said Mark Weisbrot, co-director of the Center for Economic and Policy Research.

"New factors such as rising food prices and the international financial crisis -- which originated in the US housing market -- have made governments even more skeptical of international commercial agreements designed by the rich countries."

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