JP/3/WTO

JP/3/WTO

Doha deal on trade shapes up but hurdles remain

Alan Wheatley and Rawhi Abeidoh Reuters Doha

The United States said on Monday the outline of a deal to launch a new round of world trade talks was taking shape, but India said that rich-country barriers to textile imports could wreck it.

The clash of views reflected the quickening pace of bargaining on the penultimate day of a five-day World Trade Organization (WTO) meeting whose outcome is deemed crucial to boost confidence in the ailing global economy.

"Less than a good deal is better than no deal at all. No deal would give a very bad sign at the time when the global economy is facing recession," said Moroccan delegate Nacer Benjelloun- Touimi.

Ministers from the 142-member WTO are meeting in the Qatari capital on the shores of the Gulf amid tight security following the attacks on the United States on Sept.11.

Armed soldiers guarded the hotel conference center and U.S. marines stood ready on ships offshore.

Negotiators reported specific progress to settle a row over drug patents that has pitted wealthy countries' desire to protect intellectual property rights against poor nations' need for cheap medicine to combat diseases like AIDS.

"The text needs to be put to a higher level now. If it's deemed to be satisfactory -- and there are indications that it may well be -- then that might well open the way for a breakthrough in that area," European Union spokesman Anthony Gooch told a news conference.

Disputes between the world's haves and have-nots have peppered every discussion at the meeting. But a U.S. official expressed guarded confidence that a deal was within grasp.

"We see the pieces starting to fall into place but there is still a ways to go," the official told reporters.

India, however, warned that a refusal by rich countries to open their markets for developing-country textile imports could block agreement on a new round of trade talks.

"There's still a deadlock and it could be a deal-breaker," Indian Commerce Minister Murasoli Maran said.

After a weekend that saw China, the world's most populous nation, and rival Taiwan join the global trading club, officials said frantic drafting was under way to find acceptable language on issues from farm subsidies to environmental rules.

China is accepted into WTO on Saturday, while Taiwan is on Sunday.

The questions are arcane but the outcome of a new trade round, which would take several years to complete, will affect the price and availability of goods in shops around the world.

Millions of workers could lose their jobs, and millions of others find work, as industries rise and fall because of market- opening moves on the table in Doha.

The issue of patents -- covered by the WTO's Trade-Related Aspects of Intellectual Property Rights, or TRIPS in the jargon -- has bitterly divided developed and developing countries.

WTO officials see resolving it as essential to correcting the image that freer trade favors the rich over the poor.

Developing countries, led by Brazil and India, are seeking a waiver on public health grounds of rules that guarantee 20-year patents on medicines.

They say they cannot afford costly Western drugs to treat scourges such as malaria that affect millions and must be able to make or import cheap generic versions without fear of litigation from drug companies or the WTO.

Led by the United States, industrialized countries are reluctant to provide a waiver, fearing its impact on other patents and a threat to the US$300 billion-a-year drugs industry.

One U.S. official reported a "better sense of convergence" on the crucial issue but a European envoy said he doubted there would be a deal until the last minute. "We're not out of the woods yet," he said.

Aside from the drugs issue, developing countries are wary of European proposals to link trade to strict environmental rules, seeing them as back door protectionism. They insist that rich states must honor past market-opening pledges before they can consider taking on onerous new obligations.

Western governments have made much greater efforts than in the past to reach out to developing countries, which make up 80 percent of the WTO's membership, arguing that freer world trade is a recipe for greater wealth that lifts all with it.

"Trade liberalization is an essential ingredient in developing countries' efforts to achieve higher economic growth and reduce poverty," Deputy U.S. Trade Representative Peter Allgeier said.