The two-day meeting of the commerce ministers from all over the world are meeting in London that began Monday, to be followed by further discussions in Geneva, will be purported to salvaging the global trade pact from collapsing due to an impasse over agriculture issue.
The trade talks with US and South American countries held recently ended in a failure over America providing subsidy to farm sector and refusing to lower the tariff rates on imports from developing nations including countries from Latin America.
These meetings have been organised as a prelude to a conference of Commerce Ministers from 148 countries to be held in Hong Kong in December. The WTO conference in Hong Kong will complete the ground work for an international agreement on reducing tariffs, quotas, subsidies and trade barriers.
Hong Kong is bracing for violent demonstrations as it was witnessed during WTO ministerial meeting in Seattle, US and in Cancun in Mexico in 2003. The emerging tigers like China, Brazil and India are clamouring that affluent nations must do much more to reduce trade barriers. The United States and the European Union (EU) both have offered to cut down subsidies and slash tariffs. But both accused each other for being inadequate. The US is often called the wealthiest and the stingiest nation in the world.
The world agriculture markets are said to be in a mess with all kinds of distortions and trade distorting measures gripping it ,the experts said. Japan, South Korea and Switzerland are not attending the London or Geneva meetings.
They stiffly oppose significant dismantling of restrictions on agricultural products. These countries have imposed severe restrictions on imports of food.
About the failure of talks about straightening the trade imbalance between US and Latin American countries, President Bush said to satisfy Brazil and other South American countries he needs to cut down subsidies to farm sector in the US and lower tariffs on imports. Such proposals are loaded with political implications.
The US will reduce subsidies and tariffs "so long we get the same treatment from trading partners United States and China will enter into an agreement to limit Chinese textile exports to America", so President Bush said. China sold America textile worth $14.6 billion and bought American textile worth $278 million in 2004..
The overall Chinese textile exports to the US grew by 54 per cent in the first eight months of this year. China sold 700 million pairs of socks to US in the first eight months of this year up from 12 million four years ago and sales of jeans, underwear and other labour intensive items are up tenfold compared with 2004.