London and Geneva

Geneva - Bilateral discussions among the trade chiefs of the European Union, India, the United States and Brazil held over the weekend in London and Geneva stepped up movement in the Doha Development Agenda negotiations to finalize the possible elements of a deal in the difficult packages of agriculture and market opening for industrials, WTD has learned (WTD, 3/2/07).

But the meetings ended with differences over the coefficient to be used in the Swiss formula as well as "paragraph eight" flexibilities in the nonagricultural market access talks and the treatment of "special products" and the "special safeguard mechanism" for developing countries in the farm negotiations.

The "merry-go-round" of bilaterals included a EU-India meeting on Saturday, an EU-US meeting on Sunday, a conference call between the EU and Brazil on Sunday afternoon and a US-India meeting held yesterday evening.

Today, US Trade Representative Susan Schwab will meet with Doha agriculture negotiations chair Crawford Falconer and then proceed to a session with African trade envoys. Later, she is expected to hold a meeting with World Trade Organization Director General Pascal Lamy and Brazilian foreign minister Celso Amorim.

Brazilian foreign minister Amorim will meet with Indian trade minister Kamal Nath - focusing on the "unity of G-20," sources suggested to WTD.

During the marathon EU-India meeting on Saturday, the two ministers discussed possible elements of a final agreement in agriculture and NAMA - despite the continuation of sharp differences. The biggest difference involves the coefficients in the NAMA tariff-cutting formula - where Brussels is insisting on "15" for developing countries and "10" for industrial nations, while India says such a formulation goes against the July 2004 Doha mandate.

EU Stance on Coefficients

In the London meeting, EU Commissioner Mandelson suggested that Brussels could consider a higher coefficient - if developing countries indicate which specific products would come under "paragraph eight" flexibilities, sources said. However, he ruled out any change in the coefficient of "10" for industrialized countries.

In the US-EU discussions, Brussels reportedly told Washington that it can consider a US domestic farm spending ceiling of between $14 billion and $15 billion in the "amber" and "blue" boxes accompanied by product-specific disciplines, including a combined cap in spending under the two boxes.

The EU wants developing-country members of the Group-of-33 coalition to come off their position - at least somewhat - on having 20 percent of farm tariff lines designated as "special products'. It also wants clearer disciplines on the "special safeguard mechanism" triggers for volume and prices, sources said.

There is a growing sense here that Brussels and Washington have closed many of the gaps in the Doha agriculture package - although differences remain over agricultural market access and the treatment of "sensitive" products.

An EU spokesperson said the Mandelson/Nath was "useful," but declined to spell out details.