Trade Talks In Trouble As Deadline Passes

A top US trade official has expressed his disappointment that trade ministers at the World Trade
Organization (WTO) failed to meet an April 30 deadline to agree on how to proceed with trade
liberalization negotiations, which many say must be concluded by the end of this year.

Peter Allgeier, US Ambassador to the WTO, told a meeting of trade negotiators that failure to
meet the April 30 deadline was more than a disappointment; it raises serious questions about our
collective commitment to the Doha Round goals of significant liberalization and reform of trade
this year. Trade officials had set an April 30 deadline to complete the so-called modalities that
would set out the procedures for carrying out negotiations.

A new deadline of July 31 has been set, raising major concerns that it would not be enough time
to reach agreement on a wide range of agriculture, industrial and consumer trade issues.

The end-of-2006 goal to complete the negotiations is considered critical, as that would give the
US Congress time to ratify the agreement under the president’s trade promotion authority (TPA),
which expires in July 2007. Under TPA, what will likely be an intricate trade agreement can only be
given an up or down vote in Congress without any amendments permitted. With the present mood in
Congress with regard to trade, there is no assurance that TPA would be extended.

Both textile manufacturers and importers of textiles and apparel would like to see the Doha
Round move forward, but for different reasons. Textile manufacturers are braced for some tariff
reductions, but they hope the round would result in something more important to them – a
safeguard mechanism that would permit the imposition of import quotas where there is market
disruption or a threat of market disruption. Imports see the tariff cuts that will be proposed as
part of the Doha Round as a way to get the products they need at the best prices from a wide
variety of sources.

Looking at the new July deadline, Allgeier called for negotiators to get serious now and not
backload all the tough decisions until July through inaction. “We can bring the Doha Round to a
successful conclusion by the end of this year if we stay focused on the job at hand and make the
necessary decisions,” Algeier said. “We need to do this in the coming weeks. We do not have the
luxury of postponing decisions on agriculture and manufacturing modalities until the end of July –
we must start to see the shape of the overall package in July.” He added the trade ministers have
an enormous challenge in the days ahead.

However, he said the United States remains committed to the very highest level of success, and
it is prepared to exercise the will, devote the resources, provide the leadership and work with the
rest of the WTO membership.

May 1, 2006