The world and its poor need a new trade deal

The good news about World Trade Organization talks is that they are back on track, after having fallen apart in Cancun, Mexico, nine months ago. The bad news is that the most that can be hoped for by the end-of-July deadline is an agreement to keep talking.

A recent, broad consensus about the need to resolve differences over agriculture -- the sticking point in Cancun -- means trade ministers will now focus on a framework for further talks. Given the new calls for serious negotiation coming from the European Union, the United States, the Group of Eight and the Group of 20 developing nations, some kind of agreement looks likely. This will buy negotiators another 18 months to complete the current round, rather than having to admit failure and go home empty-handed.

The substance behind the framework and prospects for the round generally are another matter. It all hinges upon real progress in the area of agriculture, and specifically on the elimination of the developed countries annual US$300 billion in market- distorting farm subsidies and tariff barriers. The continued existence of these subsidies harms developing and poor countries most.

Details to look for in the framework agreement include a reasonably short time frame for elimination of subsidies, concessions allowing poor countries to compete in areas where they can produce goods at a fraction of the rich-world cost -- like cotton and sugar.

Were Doha to fail, it would be disastrous for the premier world-trade body. It would also be detrimental to the worlds poorest countries, for whom trade offers far better prospects for development than direct aid.

-- South China Morning Post, Hong Kong