Japan hopes to break tariffs deadlock

Shoichi Nakagawa, Japan's trade minister, yesterday pledged to push ahead with informal meetings with other World Trade Organisation members ahead of the next official round of trade talks in December in a bid to break a deadlock in the negotiations over market access for non-agricultural goods.

Ending a day of informal talks with six Asian WTO members, he said the group had agreed to try to reach a consensus on non-farm tariff structures by the end of July in preparation for the official ministerial conference in Hong Kong later this year.

'The benefits to be reaped from these negotiations could help contribute to global economic growth and alleviate poverty,' said Mr Nakagawa, in an interview with the FT. 'We are taking an offensive stance that can bring many benefits to member countries.'

The meeting, the first of its kind, comes as Japan moves to solidify bilateral trade agreements with several Asian countries, including the Philippines, Malaysia and Thailand.

In 2003, 93 per cent of global trade involved non- farm products, according to Japan's Ministry of Trade.

The talks involved trade ministers and senior officials from Hong Kong, China, the Philippines, Singapore, Thailand and Indonesia.

Global trade liberalisation talks under the Doha Round, launched in November 2001, have stalled due to a wide gap among member economies over key issues ranging from tariff cuts to farm subsidies.

The big potential gains from trade liberalisation lie in trade with and within the developing world, as tariffs between the rich trading blocs - the US, Canada, EU and Japan - are generally low.

Four formula-related proposals for harmonising non-farm tariff structures have been tabled since July: one by the US, one by the EU, one by Chile, Columbia and Mexico, and one by Norway.

'There are some differences in positions; we would like to overcome th ese,' said Mr Nakagawa yesterday.

'The success in December in Hong Kong is very critical and some countries have not yet submitted formulas, which we are encouraging them to do. We have decided to keep meeting whenever we have a chance.'

Mr Nakagawa also met with Stefan Johannesson of Iceland, chairman of the WTO's negotiating group of non-agricultural market access, over the weekend. They agreed that WTO trade liberalisation talks should be expedited through ministerial level negotiations.

Separately, Mr Nakagawa said yesterday seismic exploration for gas by Japan in the east China sea had been completed. The next step, he said, was for the government to render a decision on whether to give approval for several Japanese companies to commence drilling.

Japan has protested at China's exploitation of the Chunxiao gas field, 4km on China's side of the line dividing the two countries' exclusive economic zones.