Food aid fight darkens mood as WTO talks open

By Sophie Walker and Ee Lyn Tan

HONG KONG (Reuters) – A transatlantic row on food aid
boiled over and anti-globalisation protesters clashed with
police on Tuesday as troubled trade talks got under way in Hong
Kong.

Deadlocked in negotiations for a free trade accord because
of differences over cutting subsidies and import tariffs, World
Trade Organization (WTO) states shifted their focus to
delivering a package of trade support for developing nations.

But U.N. chief Kofi Annan told ministers of nearly 150
states that they must make real progress on the Doha trade
round at their six-day meeting or disappoint the millions who
“yearn to lift themselves out of poverty.”

Tension between the United States and the 25-nation
European Union burst into the open as the meeting got under
way, with European Trade Commissioner Peter Mandelson calling
for “radical reform” to the U.S. system of food aid for
developing nations.

Washington sends aid donations in the form of domestic
corn, wheat and other commodities, but Brussels says cash is
quicker and less likely to affect the delicate balance of local
trade.

“Food aid for poor countries and emergency relief can be a
tool to advance development and for humanitarian relief,”
Mandelson told a news conference. “But the U.S. programme is
designed to give support to U.S. agricultural producers.”

He also blasted a U.N. newspaper advertisement which said
that restrictions on donations of food to the United Nations
could take food out of the mouths of hungry children.

“I find it shocking that U.N. agencies should be financing
an advert … that is designed to support U.S. trade-distorting
policies on food aid,” he said.

U.S. Trade Representative Rob Portman told reporters he did
not understand the EU “obsession” with food aid. His
spokeswoman, Christin Baker, said Washington had put forward a
proposal to tighten food aid to ensure it does not skew local
commerce.

At the opening ceremony of the talks, dozens of protesters
inside the hall forced WTO Director-General Pascal Lamy to
raise his voice as they chanted: “Development yes, Doha no’.”

CLASH WITH POLICE

Outside, over 100 protesters leapt into Hong Kong harbour
after a march by 4,500 people against trade liberalisation.

“The WTO is driving us to our deaths,” one Korean protester
yelled as the protesters bobbed in the murky waters around a
city which, ironically, owes much of its prosperity to a long
tradition of international trade.

Nine people, including two police officers, were slightly
injured as police used a skin-irritant spray to force back a
group of protesters. But there was none of the intense violence
seen during the last WTO meetings in Cancun and Seattle.

Hong Kong had originally been billed as the last milestone
to an agreement on the Doha trade round, which was launched
four years ago in Qatar with the aim of lifting hundreds of
millions in the developing world out of poverty through
increased trade.

The WTO nations still hope to reach a final deal by the end
of 2006. But, bogged down over how far to open their farm,
services and factory goods markets to more trade, they have
given up plans to seal a blueprint in Hong Kong.

The EU, in particular, has faced huge pressure to make
deeper cuts in agriculture tariffs than the average 39 percent
it has offered. But it has refused to budge without balancing
pledges from developing states to open their markets to
industrial goods.

“The European Union will not make a new offer,” said French
Trade Minister Christine Lagarde, whose country has been widely
criticised for its determination to protect French farmers.

But the Brazil-led G-20 group called in a statement for a
draft deal cutting rich nations’ farm tariffs by April.

“We must move in agriculture for the other areas to move,”
said the developing-country group, which accounts for almost 70
percent of the world’s rural population.

In a speech delivered in his name to the opening session,
U.N. Secretary-General Annan said the time had passed for
“brinkmanship” in the four-year-old battle for a treaty.

“The lack of major gains here … would be a severe
disappointment for poor people around the world yearning to
lift themselves out of poverty,” said Annan, whose speech was
read by UNCTAD trade and development agency chief Supachai
Panitchpakdi.

With main areas of the talks stalled, ministers focused on
delivering trade support to the poorest developing countries as
a sign that they, too, would benefit from more open markets.

“The EU has not come empty-handed,” Mandelson said,
announcing that EU members had agreed to more than double
annual spending on trade-related aid to 1 billion euros.

Japan has announced a $10 billion trade-related aid package
and the United States is expected to outline plans for
increased assistance in a speech on Wednesday.