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WTO chief raps US, EU on Doha Round trade talks

The chief of the World Trade Organization Thursday criticized a new US farm bill, saying it sent a wrong signal to the Doha Round trade talks, while urging the European Union to show more flexibility.

“I was quite transparent in saying that this farm bill is not sending a great signal that the US are serious about reducing their trade-distorting subsidies,” WTO Director-General Pascal Lamy told a European Parliament committee after meeting visiting US lawmakers in Brussels.

The US Congress last week passed a bill that increases subsidies for farmers and food stamps for the poor amid rising food prices, which analysts said signals that a reduction in US farm subsidies will be difficult to achieve.

The WTO Doha Round trade talks, launched in 2001, have been deadlocked because developing and developed nations cannot agree on agriculture and non-agricultural market access, with the United States facing demands to slash market-distorting farm subsidies. “The only chance you have to trump up this farm bill is the WTO deal which will then necessitate a reform of the US system,” Lamy said. Lamy, former EU trade commissioner, also urged the 27-nation EU to show more flexibility in the ongoing crucial talks intended to conclude the Doha Round this year, after which the US presidential election and other factors may lead to years of further delay.

Last week, the WTO put forward fresh compromise proposals on agriculture and industrial goods trade, but France, Ireland and a few other countries with big farm interests recently expressed strong opposition, claiming that the EU offered too much in the field of industrial goods without reward of improved market access to emerging markets. “Europe is magnifying what it is giving and minimizing what it is getting,” he said, “It’s not true to say that the EU is going to pay in agriculture without getting anything in industrial goods.” Despite little time left, Lamy said the chances of a successful deal this year are 60%. (