HONG KONG, Dec 8 (AFP): India and Brazil, two of the biggest and fastest growing of the developing countries, may hold the key to a deal at crucial World Trade Organisation (WTO) trade talks here next week, the chair of the meeting said Thursday.
Hong Kong industry chief John Tsang said the two developing giants would be asked to make trade-offs to move the European Union from an impasse on cuts to agricultural subsidies, a major obstacle to clinching a global trade deal.
"What we are asking is for some of the more advanced developing economies, such as Brazil and India, to open up a bit more (on industry and services) before the EU can move on agriculture," Tsang told reporters.
Finance chiefs and ministers from 149 countries will meet here next week for the WTO ministerial conference that is hoped to bring close to conclusion the Doha Round of trade talks.
At stake is an agreement to lower barriers to global trade and use the gains to bring development to the world's poorest countries.
The EU's refusal to offer more cuts to subsidies for its farmers has brought pre-summit talks to a standstill and threatens to scupper the round.
Rich nations' subsidies of their farmers prevent poorer, mostly agricultural economies, from selling their farm produce in developed markets, robbing them of vital development income .
However, the EU complains that India and Brazil are not offering a quid pro quo and has demanded the two open up their protected industrial goods and service sectors to foreign investors.
Tsang said trade-offs will be vital to the success of the talks.
Meanwhile report from Geneva adds: World Trade Organisation Director General Pascal Lamy faces a baptism of fire at the WTO's ministerial conference in Hong Kong, less than four months after he took the helm of the global trade body.
Despite the unusual unanimity that surrounded his appointment, the former EU trade commissioner warned straight away that he could not wave a "magic wand" over deadlocked talks on breaking down trade barriers.
But Lamy will, the diplomat added, face a fiery test of his mettle in Hong Kong that is likely to shape the Frenchman's reputation for the rest of his term as shepherd of the 148 trading nations.
A WTO official said the respected European negotiator had to undertake a "paradigm shift" when he arrived to become "everyone's friend, not the negotiating adversary that he was before".
Leaving his old EU cap behind, Lamy recently defended developing nations in their clash with wealthy trading powers, underlining that they formed two-thirds of the WTO's membership.
Message from Hong Kong says: The World Trade Organisation (WTO) meets here next week to salvage a deal to liberalise global trade blocked by an EU and US impasse on cutting massive farm subsides that critics say hurt the poor most.
Preparatory talks have produced only a series of 'you first' trade offers and no basis for an overall deal whereby the developed world would open its agriculture markets in return for free access in the developing world for its industrial goods and services.
The main protagonists-the European Union and the United States along with India, Brazil and Japan-have accordingly downgraded expectations, saying the Hong Kong meeting should keep the Doha Round on course while leaving a final accord for next year.