Global Trade Round Could Fail

The current stalemate over agricultural subsidies and other issues could cause global trade talks to collapse unless progress is made at a World Trade Organization meeting in Hong Kong next month, Asia Pacific countries are warning.

A draft statement being discussed by senior officials from the 21-member Asia Pacific Economic Cooperation forum, obtained Sunday by The Associated Press, strongly backs the WTO's current agenda for reducing subsidies and other barriers to free trade.

"We all agree that the Hong Kong ministerial (meeting) will be a critical step in achieving this goal," the draft says. "Yet, we are all seriously concerned that the current impasse in the negotiations may lead to a potential failure of the round."

APEC leaders, including U.S. President George W. Bush, Chinese premier Hu Jintao and Japanese Prime Minister Junichiro Koizumi, are expected to sign off on the statement at the end of their annual summit on Friday and Saturday, though the final wording may change.

The United States, Australia and some other APEC members have demanded greater cuts to subsidies that protect European farmers from outside competition. The European Union has refused, and the stand-off threatens to paralyze the current round of talks at the WTO.

The APEC statement says that while the initial expectations of the Hong Kong meeting may not be achieved, "we should nonetheless not compromise the level of ambition for the whole round" set out in the 2001 Doha Declaration, named for the Qatari capital where it was launched.

"We, therefore, urge all WTO members to make further, meaningful contributions to move the negotiations forward," the draft APEC statement says. "Doing this will require economically and politically difficult decisions by all WTO members."

The 148-member WTO is scrambling to prevent the Dec. 13-18 Hong Kong meeting becoming a repeat of the previous ministerial gathering in Cancun, Mexico, in 2003, which collapsed in acrimony and paralyzed the trade body for months.

But negotiators meeting last week in Geneva and London failed to make progress toward ending the stand-off, and hopes for the Hong Kong meeting have plummeted.

Officials at APEC meetings in Busan, South Korea, say they hope a strong statement from the group's leaders can breathe new life into the WTO talks.

APEC includes seven of the world's 13 largest economies, about 60 percent of the global economy and nearly half of world trade.