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World seeks trade breakthrough in China
(Agencies)
Updated: 2005-07-14 06:45

The G20 initiative is a compromise between the EU, which favored a uniform cut in all farm tariffs, and agricultural exporters such as Australia that wanted high tariffs to be cut the most in order to maximize their market access.

The plan groups tariffs into five bands and then subjects them to a uniform cut.

To the outsider, Tuesday's breakthrough might appear modest and arcane. For a start, the size of the reductions, and exceptions for developing countries, promises painful bargaining ahead. What's more, the EU and Japan said they would press for the across-the-board cuts to be administered flexibly.

The trade round was originally due for completion by 2004. Ministers now aim to wrap it up by the end of 2006, more than five years after it was launched in the Qatari capital Doha.

WTO Director-General Supachai Panitchpakdi welcomed the progress, but said he was worried that a lack of details would enable negotiators to unravel the formula and make it hard to meet the deadlines for an overall deal.

"Everything is conditional upon others, as usual," Supachai said. "I think we should move as rapidly as possible to clinch the deal especially in the key areas of farming."

Japan, a fierce protector of its farmers that levies a 500-percent tariff on rice imports, said it could not accept a proposal to cap farm tariffs at a maximum 100 percent.

"We don't think establishing a tariff cap has good reasoning," said a Japanese trade negotiator.
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