[Comment: The gross factual error in the first paragraph of this story
(i.e., that a 'new round' is due to begin next week) is typical of the
neglect of these issues by Australian media. - BJ]

Page One lead story, Weekend Australian, 27 November, 1999

AUSTRALIA THREATENS TRADE TALKS
By ROBERT GARRAN

AUSTRALIA has issued an unprecedented threat to walk away from the new Millennium Round of world trade talks due to begin next week unless there are big cuts in farm trade barriers.

The warning from Trade Minister Mark Vaile came amid fears that the world's trade ministers would abandon the three-year trade talks, which could boost Australia's exports by billions of dollars.

Trade ministers from the 135 members of the World Trade Organisation gather in Seattle next week to try to launch the new trade round.

But the talks are shrouded in gloom after negotiators in Geneva failed this week to agree on a draft text to launch the new trade round. Veteran observers said they could not remember such a poor beginning to a new trade round.

Mr Vaile's hard line aims to put maximum pressure on the European Union to relent on its demands for an agenda so large it will suffocate the talks.

As leader of the Cairns Group of farm trading countries, Mr Vaile's threat carries more weight than Australia would alone and his stance is reinforced by US support.

But European officials warned privately that Mr Vaile's aggression would make it even harder to find common ground.

Mr Vaile said Australia would gain billions of dollars a year from eliminating trade barriers, but the talks had to promise substantial gains in access to world markets for Australian farmers.

The seven rounds of trade talks since World War II have been the key to the strong global economic growth of the past 50 years, but most of the trade-opening has been in manufactures and little in agriculture.

Officials fear the chasm between the three main groups in the talks – the US, Europe and the Australia-led Cairns Group – may be too wide to close in the three days of talks beginning next Tuesday.

There are fears that the lack of strong and sustained backing from US President Bill Clinton has weakened the prospects of a deal.

A European diplomat said yesterday the US was "riding in the slipstream of the Cairns Group".

However, US goals are much closer to Australia's than in the previous Uruguay Round, a plus for Mr Vaile's agenda.

Mr Vaile told the National Press Club that Australia wanted a three-year round that focused on better market access in agriculture, services and industrial products. But the round must deliver fundamental reform of global farm trade.

"Let's not launch a round at any cost; we've got our national interest to take into account," he warned.

Mr Vaile said talks to negotiate cuts to farm and services barriers would continue even if the new trade round failed, but he was seeking more ambitious goals than those so far agreed, especially in agriculture.

This week he told European trade commissioner Pascal Lamy that the EU "will have to agree to an ambitious mandate on agriculture if it expects others to accept ambitions mandates in other areas".

The US and the Cairns Group want a narrow, more manageable round limited mainly to agriculture and services, although the US also wants a new forum on trade and labour rights and monitoring of environmental impacts.

But the EU wants to add investment and competition policy, issues that critics say will bog the talks down for years.