AFP | July 29, 2008

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Talks on a new world trade pact broke down without agreement here Tuesday, delegates said, after more than a week of bitter wrangling.

“The package that we were able to negotiate and agree on Friday night is not going to carry the day,” US Trade Representative Susan Schwab told reporters as she left a meeting of key trading powers, referring to an earlier breakthrough on a deal proposed by WTO chief Pascal Lamy.

New Zealand Trade Minister Phil Goff confirmed that talks had collapsed. “We won’t see a conclusion to the round this year,” he told reporters as he left the meeting.

Ministers had struggled for more than a week to close differences on subsidies and import tariffs to forge a new deal under the World Trade Organization’s Doha Round, launched seven years ago.

Delegates said negotiations stumbled over proposals for import tariff measures to protect poor farmers that would impose a special tariff on certain agricultural goods in the event of an import surge or price fall.

India and the United States were sharply divided over the so-called special safeguard mechanism (SSM).

“The United States and India did not accept the compromise proposals, and arrived at an impasse,” a source close to the talks told AFP, adding that the negotiations had broken down.

Some developing countries such as India wanted that mechanism to kick in at a lower import surge level than has been proposed in order to protect their millions of poor farmers from starvation. Others wanted it to take effect at a higher rate.

India’s Commerce Minister Kamal Nath had dug in his heels over the proposed tariff thresholds, claiming the backing of around 100 developing nations.

With both sides refusing to give way, acrimony had grown on Monday with the United States publicly accusing India and China of holding up progress.

Schwab described the final meeting as “very disappointing.”

“Throughout the last 10 days, and in the months and years prior to this, the United States have shown leadership in trying to get this done. We remain committed to the Doha round,” she said.

“It is critical that we move forward.”

“The gulf between the major parties on the SSM was too wide to bridge,” Goff said. “That was the issue that has prevented these talks moving forward to conclusion.”

9/11 Chronicles Part One: Truth Rising

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