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Brazil and India Would Rather Have No Deal than Bad Deal with US and EU

Brazilian Foreign Minister Celso Amorim with Indian Trade Minister Kamal Nath

Brazilian Foreign Minister Celso Amorim with Indian Trade Minister Kamal Nath Ministerial representatives from the G4 group of influential trading players, European Union, United States, Brazil and India, will strive to reach a common position on agriculture, industrial goods and services in the framework of the World Trade Organization negotiations.

These four leading trade powers will meet Wednesday in New Delhi, India, for two days of potentially make-or-break talks to end a deadlock in the Doha Round of global trade negotiations. Japan and Australia are scheduled to join the group in a second stage of talks.

"These talks are timely and important," EU Trade Commissioner Peter Mandelson said in Brussels ahead of the talks. "If we fail (at these talks), Doha's prospects for this year will be lost."

The meeting will be attended by Mandelson, Indian Commerce Minister Kamal Nath, US trade representative Susan Schwab and Brazilian foreign minister Celso Amorim.

"We hope there'll be some movement (at this meeting) but it depends on how far developing countries' aspirations are fulfilled," an Indian government spokesperson said in New Delhi.

WTO is hoping to reach a deal before the end of June when crucial trade negotiating powers granted to the US President George Bush by Congress (Trade Promotion Authority) are set to expire.

If a breakthrough can be achieved by June, a conclusion to the Doha talks – which have been called a once-in-a-generation chance to help bring millions out of poverty – could be reached in about eight months, WTO officials say. Otherwise the Doha round, launched in Doha in 2001 risks years of delay, they said.

An agreement among the world's two biggest trading powers, the US and EU, and two leading developing nations India and Brazil, is seen as crucial to hopes of brokering a compromise among the WTO's 150 members this year.

India and Brazil have emerged as leaders in the developing world's challenge to the wealthy nations to curtail generous farm subsidies as they seek to keep their own agriculture supports.

The official Indian position has been that New Delhi prefers "no deal to a bad deal", particularly if there's no advance in farming subsidies.

The EU and other WTO members have called for Washington to make a new, more radical proposal on cutting farm subsidies while the EU is being pushed for steeper reductions in farm product tariffs.

"We want real, effective reductions in huge farm subsidies by countries like the US which distort world agriculture prices," said the Indian spokesperson adding that "we must have a level playing field so the round's development mandate is fulfilled."

Developing nations are being pressed to open their markets wider to industrial goods and services and the US is seeking fewer farm products on their "protected" list.

But India and other developing nations argue they need their farm tariffs to protect the livelihoods of their huge farming populations. Up to 80% of the workforces in developing nations depend on agriculture.

Mandelson said India, Brazil, the EU and the US need to put solid offers on the table if negotiations are to succeed. "It's the responsibility of the G4 to put the numbers on the table" on reductions in farm support and agriculture and industrial tariffs, he said

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  • Show Comments (8)

  • AES

    Swiss spend as much annually on subsidising three cows as they do on primary schooling for one child
    Cows and kids

    The Swiss spend as much annually on subsidising three cows as they do on primary schooling for one child.

    That, at least, is the conclusion of one of the country’s leading economics professors.

    Silvio Borner, head of Basel Universityˢ۪s department of applied economics, calculated that a single Swiss cow costs SFr4,000 in government subsidies, while the bill for keeping a child in primary school for one year is SFr12,000.

  • AES

    The price of tea in china
    I was extremely impressed with the style of Brazilian designed cars, campared to U.S. cars. In an age of pragmatism smaller and efficient is the objective. Brazilian design is on a par with New York, or Paris, or London, especially graphics. Television commercial design is also well done. The near 67% increase in the Real makes some things practicle to export and somethings not. To have to increase a car at a cost of $20,000 to $30,000 kills the competitive value of product. Just for amusement, what car does Switzerland manufacturer? Brazil no longer needs to export
    to the E.U., China will buy all the soy that Brazil will produce, the buyers are changing, different people have sat down to the table of economic gamemanship. You sell what you can sell to whom you can sell it, at what the market will bear. In my research on Switzerland I was amazed at how much money was made, how many hours the Swiss worked, weekly, the cost of living and the amount the was left for discretionary spending. I was also amzaed that women, in Switzerland, got the right to vote in cantons in1959, the federal level in 1971 and the last canton, Appenzell Innerroden, allowed women to vote in 1990. I was amazed to find that Switzerland became a full member of the U.N. in 2002. I would like to see the the U.N. moved to Lucerne, or the Haag and out of New York, it is a white elephant. And Switzerland is tenth in Gross Domestic Product per capita at purchasing power parity, behind Iceland. Regardless, you are a very neat industrious people. But you are a small people, the size of a city. The problems of a city are not those of a country as wealthy in natural resources as Brazil. We can buy technology, we can buy robotics, but you cannot buy land, or water, or sunlight. Because of the increased value of the Real, Brazilians have begun en mass to travel, to see the world, to see what is possible, to see how much you charge for a box of Swiss chocolates.

  • AES

    Killing the customer
    The U.S. engages in mechanized agronomy and as such out produces, ie production/cost any labor intensive agricultural economy. The U.S. should allow humanitarianly whatever developing nations need to protect their indigenous economic structure. The U.S. is infinitely more flexibile in whom it chooses to sell to or deman from. The playing field is not even. Switzerland subsidezes 70% of its farmers and by consequence pay 67% more for its household food bill than Spain. What good does it do the U.S. or the E.U. to flood developing labor dependent economic cultures with ‘cheap’ goods that kill the economy they seek to benefit from. To make someone poorer is bad economics. Wining is not always wining. Sometimes you have to give to get. Give the poor the opportunity that they particularly need, first food, then planes, then McDonalds, and so forth. What do you bennefit if you kill the customer?

  • Ric

    The USA
    DoesnÀ‚´t care who deals as long as they can continue to handle the shuffling and do the cutting themselves.

  • brazilian guest

    To U.S. Guest, (Very impressed with your writing!)
    No deal to you (TOO) ???
    Hummm you must have been classmates with Bo and Allen Brown. 😉

  • u.s.guest

    “NO DEAL” TO YOU TOO !!!
    TAKE IT OR LEAVE IT MUNCHKIN…..

  • Swiss Pride…LAUGH LAUGH LAUGH

    So Mr.Ch.c once again you are OUTSMARTED and OUTCLASSED
    by a bunch of people with a cephalic mass 100 X the size of yours. What I expected from somebody like you…”The voodoo king of economics…The emperor of backyard macroeconomics… The Czar of Globalization” laugh laugh laugh…all this, only in your own miniscule SICK MIND, of course.
    Let us hear you talk economics Mr.Ch.c with yours NOT so solid fundamentals. Its time for you to turn off the light Mr. Ch.c. À¢€¦take your favorite gun with youÀ¢€¦ go for a long lonely walk and do NOT for Brazil BUT your own country a favor by INSTANTANEOUSLY increasing the Swiss À¢€œper capitaÀ¢€Â IQ for generations to come. 😉

    One can only conclude that “COW TIPPING” is done very very carefully in Switzerland!!! laugh laugh laugh 🙂

  • ch.c.

    From Switzerland……SO WHAT ?????????
    Dont you charge 100 % IMPORT TAXES ON BMWs and MERCEDES ????????
    Funny that in a developing country…BMWs and Mercedes are 2 X more expensive than in developed nations !!!!!!

    The same could be said for high end PCs, tractors and trucks !!!!!!!!!

    Yesssss you do protect your own industries far more than we do !

    Better yet, most of these industries are not even Brazilians, but foreign and they have created millions of WELL PAID JOBS IN BRAZIL !!!!!

    And if you are against the US import tax for ethanol, since you can produce cheaper than the USA, why not apply that same thesis on your cars ??????? Why not close all you car plants and switch them in the EU, USA or…..China ! and if you dont charge taxes, you should be able to buy cars at a lower prices….than TODAY !!!!!!!!

    Ohhhhhh I see, it is not in your interests !!!!!!!!! LAUGH….LAUGH….LAUGH !!!!!

    As to the price difference between Switzerland and SPAIN, there is 1 hole in your theory….A BIG HOLE !!!!!!!!!
    Are brazilians not complaining about the EU subsdizes ??????
    And is Spain…..NOT IN THE EU ??????????
    You are not VERY CLEVER MOST OF THE TIME…….AES !!!!!!!!

    And a final word : doesnt Brazil subsidizes its own farmers…with well below markets rates….through the government owned bank called……BNDES ??????? In fact so much, that they did quite a few times street demonstrations and roads blocades. Because they could not even repay the capital, let alone the interests ! And this since 2004 !!!!!!!

    Thus…..please review your copy and come back with better arguments !!!!!

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