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Trade powers spar over outstanding Doha issues

By Jonathan Lynn

GENEVA (Reuters) - Major trade powers sparred on Tuesday over what needed to be done to finish the long-running Doha round amid a flurry of recent activity to revive the stalled talks.

Ambassadors to the World Trade Organization from Brazil, China, the European Union, India and the United States agreed that much valuable work had already been done on Doha.

But they disagreed whether a lot or a little was needed to finish the talks, launched nine years ago this month to open global commerce and help developing countries prosper through more trade.

All restated long-standing positions, indicating how hard it will be to break out of the current impasse, but also suggesting they were readying for a final round of bargaining.

"They're just positioning themselves. They're marking out territory," said one senior trade official.

The ambassadors, speaking at a WTO workshop on the impact of the Doha round, all agreed that give and take on all sides was needed to finish the job.

Discussions by key WTO ambassadors in recent months to brainstorm on Doha have brought a sense of movement to the talks, stuck since a meeting of ministers in July 2008 broke apart over differences over the core areas of farming and manufacturing.

WTO officials and negotiators hope that leaders of the G20 will reinvigorate the talks when they discuss trade over lunch at the G20 summit in Seoul on November 12.

The main features of a Doha deal would be a cut in distorting farm subsidies by rich countries to end trade distortions that hurt developing nations, while emerging economies would open up their markets for industrial goods. All would liberalize services such as telecoms and banking, which now account for the bulk of economic activity in most states.

VARYING ESTIMATES

Estimates of the value of a deal like that vary widely, and the WTO workshop brought together leading trade economists to discuss the analyses.

Relatively modest forecasts of a boost to the global economy of $50 billion a year from opening up farming and manufacturing could be improved significantly with more ambitious negotiations and liberalization of services.

But the main benefit from a Doha deal could be locking in cuts in tariffs that countries have undertaken unilaterally, preventing protectionist backsliding and providing businesses with certainty for their investments, they found.

In any case, EU ambassador John Clarke said EU member states and the European Parliament would make a hard-headed political assessment of whether a deal created opportunities in different sectors, and created fairer conditions for developing countries, rather than looking at macro-economic studies.

Chinese ambassador Sun Zhenyu said China, which joined the WTO when Doha was launched, was not pushing for any particular concessions in the talks, but would benefit from a strengthening of the global trading system, and warned that the round was not primarily about opening markets for rich countries.

The fact that businessmen were now coming to Geneva to discuss the talks with negotiators was a sign of hope, he said.

"People are talking about a possible window in 2011," he said.

U.S. ambassador Michael Punke said what had been achieved was not insignificant -- but nor was it sufficient, reiterating Washington's call for big emerging economies to do more to open their markets.

"For us, what is very clear is the pain and what is not so clear is the gain," he said, encapsulating a view voiced by most of the others, but which WTO Director-General Pascal Lamy said was a classical negotiating stance.

Ultimately the fate of the Doha round will depend on what the United States agrees with China and the other big emerging countries, although China and the United States have not so far got down to serious bilateral talks, diplomats said.

Brazil had nothing to gain from the industrial goods talks, and the proposals in farming were still disappointing for the world's agriculture superpower, ambassador Roberto Azevedo said.

"In agriculture we're not convinced we're getting a lot but we're moving in the right direction," he said.

(Editing by Charles Dick)

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