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WTO Bali talks seek elusive tariff deal

December 03, 2013, 14:32 UTC+3 BALI
The ninth Ministerial Conference aims to speed completion of the so-called Doha talks on facilitating world trade, locked in stalemate since 2008
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BALI, December 03. /ITAR-TASS/. World Trade Organization ministers convene on the island of Bali on Tuesday seeking a deal to cut trade tariffs on agricultural produce and industrial products. The ninth Ministerial Conference aims to speed completion of the so-called Doha talks on facilitating world trade, locked in stalemate since 2008.

The package sought in Bali includes agreements in three key sections: an accord to equalize support for agricultural producers in WTO states; agreement to streamline customs procedures; and a package of initiatives to bolster developing countries.

Settling the most sensitive issue, support for the agro-industrial complex, is most expected, ending delay blamed on European and U.S. resistance to abandoning agricultural subsidies.

Meanwhile, developing countries insist that the European Union and U.S. abandon export subsidies for agricultural produce and rural support programs, and sign a legally binding document. The first step might be not entire cancellation but a reduction of subsidies.

The EU and the U.S. agree to take these measures only in exchange for easier access to developing markets and are not ready to consider these agreements separately from other Doha round deals.

But compromise on India’s demand for exemptions from its WTO liabilities on wheat purchases for regulated prices considerably below world prices may prove the most difficult task.

In earlier WTO talks, India adopted limits for such purchases. But now it wants changes in the limits, citing the need to support farmers and demanding that these exceptions should be indefinite.

However, its WTO partners are only prepared to consider temporary loosening of the liabilities the country took on for the following four years. This measure would then be subject to prolongation by the 11th Ministerial Conference.

WTO states’ delegations are concerned about the Indian trade minister’s stance, since if it remains the same, the Bali round may also result in failure. India may vote against the whole Bali package if its requirement is not fulfilled.

In the customs section, the countries will be considering an agreement to simplify and unify customs procedures as much as possible.

WTO experts estimate the positive effect of signing this agreement for world trade at $1 trillion. They have calculated that easing the costs of customs procedures alone would cut average spending of exporters to the WTO in both administrative costs and customs duties from 10% to 5%.

Discord on this issue is that developing countries want an unlimited period of transition to a more liberal customs system, with developed countries providing assistance to reform. Developed countries believe the transition period should be limited. Those assembled on Bali reckon on compromise.

Support for least-developed countries is also thought likely to see agreement. This hangs on the possibility of an increased share of quota- and duty-free imports from least-developed nations, selling certain services without restrictions to purchaser-countries in which limitations are in force.

Negotiators believe the Indian issue will top the agenda. If WTO countries make progress on Bali agreements, the Doha round may also be completed soon.

But late in November, WTO Director-General Roberto Azevedo said the organisation’s General Council had failed to agree a package planned to be approved at the ninth conference.

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