European trade chief Peter Mandelson will face increased opposition from EU foreign ministers on Monday when he tells them how he will try to keep struggling global trade negotiations alive.
Some European Union countries, chief among them France, have previously accused the British commissioner of overstepping the mandate they gave him in his determination to wrap up the World Trade Organisation talks.
The Doha round of negotiations for a global trade deal are now in their seventh year, still beset by big differences, but are heading into a potentially decisive next few weeks. Mandelson has long been an advocate of attempts to reach a WTO deal.
But his task of keeping the support of the EU's 27 governments became harder last Monday when new proposals from WTO mediators on how to unlock the deadlock met with howls of protest from European manufacturers. EU producers of cars, textiles, chemicals and other industrial goods were long seen as likely winners from the WTO's Doha round, at the expense of the bloc's farmers.
But now the manufacturers complain that Europe, the United States and other rich economies are being asked to whittle down their import tariffs while competitors in big emerging markets, such as Brazil, China and India, will be shielded.
"Obviously we would like a deal at the WTO but not at any price," said a trade diplomat from an EU state, speaking on condition of anonymity. "Most people now think Mandelson wants to close the deal at any price." That is an allegation that Mandelson has strongly denied, insisting he will not accept a deal that is bad for Europe.
LOT OF WORK TO BE DONE:
On Friday, when EU employers lobby BusinessEurope blasted the new WTO proposals as a "step backwards for trade liberalisation," Mandelson's spokesman said the commissioner agreed "a lot of work needs to be done" on industrial goods.
Another EU trade diplomat said France and other EU countries were likely to complain to Mandelson on Monday that he failed to secure improvements for Europe in the latest WTO proposals, as stressed by EU foreign ministers at a previous meeting in March.
"A number of countries still want to press on," the second diplomat said. "Some of us feel that even if the round is not going to deliver what we once hoped for, it is important for the sake of the multilateral trading system to have a deal soon." But the number of EU states fully behind Mandelson, typically including Britain and the Nordics, was shrinking, diplomats said.
Supporters of the Doha round have said a deal would send a positive signal to nervous financial markets, hit by fears of recession. But the slowing economy has stoked fears around the world about opening up to more competition, costing local jobs.
WTO chief Pascal Lamy has warned that the failure of the Doha round would be a bad precedent for attempts to reach other global agreements in the future, such as on climate change.
Negotiators hope the new proposals on industrial goods and on agriculture will pave the way for a meeting of WTO ministers to seek a long-elusive breakthrough, either in June or July.
Without a deal by then, the Doha round risks years of further delay due to the changeover in the US presidency and the replacement of the European Commission, both in 2009.
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