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Developing states clash at WTO farm talks

REUTERS, Geneva
Developing countries, who are usually allies in world farms negotiations, are split over the preferential treatment that some get when exporting agricultural goods to rich states, trade sources said on Tuesday.
The question of preferences, one of the thorniest facing the World Trade Organisation (WTO) as it seeks a global deal to lower commercial barriers, has been the subject of angry exchanges at closed-door talks on farm trade, they added.
"Things got quite heated," said one source, referring to a debate that began on Monday and carried over into Tuesday morning's session of week-long WTO talks on farm reform.
Some developing countries, often because of past colonial links, face lower tariffs on their exports to some developed country markets, such as that of the European Union.
But any WTO deal on agriculture, part of the overall Doha Round of free trade negotiations, would aim for a significant fall in rich country
tariffs and would erode these advantages.
A partial accord on agriculture, struck last July at the WTO in a bid to save the troubled trade round from stalling altogether, recognised that "the erosion of preferences" had to be addressed, but it did not say how.
The system benefits mainly African, Caribbean and poorer Pacific countries, many of which were once ruled by France or Britain, while Latin American exporters, such as Costa Rica and Colombia, are amongst those saying they will lose out.
Jamaica and Mauritius argued strongly that any accord on tariffs must take account of the potential loss of market share for their exporters, the sources said.
But they quoted a Costa Rican negotiator as telling the WTO meeting that "the economic consequences of preference erosion have been exaggerated."
Tempers were already running high over preferences at the WTO, with Latin American banana exporters threatening the European Union with action over its decision to triple banana duties to 230 euros ($300) a
tonne.
The EU move came at the insistence of African, Caribbean and Pacific (ACP) producers, who had been pushing for a duty as high as 300 euros to stop cheaper Latin American produce from flooding the EU market, where ACP produce enters duty free.
Canada proposed a differentiated approach, with the biggest users of domestic support making the largest cuts.
The EU, which accounted for some 40 percent of all the subsidies given worldwide to farmers, would be in the highest bracket, with Japan and the United States, 19 and 18 percent, respectively, on the next rung down, it said. There was no immediate reaction from Brussels or Washington to the idea.
The WTO's 148 member states are battling to reach an outline accord on the Doha Round by next December's trade ministers meeting in Hong Kong, with the end of 2006 emerging as a possible target date for completing the full negotiations.