WTO talks collapse over a Third World ‘safeguard’

After coming tantalizingly close to a historic trade deal, World Trade Organization talks collapsed Tuesday in a dismaying blow to seven years of efforts to open up the global economy.

Once promised as a recipe for lifting millions of people out of poverty, the end to nine days of high-level talks left no new trade openings for farmers and manufacturers, no global economic boost and no grand deal for Third World development.

It was by all accounts a disaster.

“This is a very painful failure and a real setback for the global economy when we really needed some good news,” said Peter Mandelson, European Union trade commissioner.

His disappointment was shared by top negotiators from the United States, Brazil and India, who have played leading roles since the organization launched its current trade round in Doha, Qatar, in 2001.

Although the talks have struggled before, this failure was perhaps the most devastating. Faced with global unrest from rising food prices, credit problems from shaky financial markets and the threat of economic downturn, negotiators had hoped that a deal this week to open farm and industrial markets would go some way toward alleviating those problems.

The talks hit a snag over an obscure “safeguard” for protecting agricultural producers in the developing world from a sudden surge in imports or a drop in commodity prices.

“In the face of global food price crisis, it is ironic that the debate came down to how much and how fast could nations raise their barriers to imports of food,” said U.S. Trade Representative Susan Schwab, who resisted attempts by China and India to ensure a loophole for developing countries allowing them to increase farm tariffs.

Schwab called the measure “blatant protectionism.”

India’s trade minister, who was blamed by a number of rich and poor countries for his intransigence, said the U.S. demands were unreasonable.

“It’s unfortunate in a development round we couldn’t run the last mile because of an issue concerning livelihood security,” Kamal Nath said.