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Food aid fight darkens mood as WTO talks open

Posted on: Tuesday, 13 December 2005, 07:32 CST

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.

Source: REUTERS

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