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Australia wants EU to focus on the real issue

Nick Gentle

Mark Vaile accuses Peter Mandelson of throwing diversionary balls into the air

Australia's trade minister has accused the European Union of employing diversionary tactics to avoid talking about the real issue for the Hong Kong meeting - market access.

Mark Vaile said EU Trade Commissioner Peter Mandelson's repeated attempts to focus debate on export assistance and cotton subsidies were aimed at masking the inadequacy of his bloc's proposals.

'What we would like to see, instead of the EU continuing to throw these diversionary balls in the air, is to get back to the critical issue that we want them to focus on, and that is market access in terms of a formula [for tariff reduction] and sensitive products,' Mr Vaile said.

'The critical element in this is that the Doha mandate calls for improved trade flows - the market access pillar must deliver improved trade flows, new trade flows.'

Suggestions for tariff reductions on agricultural goods ranged from Europe's offer of a 39 per cent reduction, to 54 per cent from the G20 and 75 per cent from the US.

'The 54 per cent only equals what was delivered out of the Uruguay round,' Mr Vaile said. 'The current EU proposal doesn't even do that. It is less ambitious than the Uruguay round.

'That is not addressing the differential treatment between agriculture and industrial products - it is perpetuating it and that is never going to be acceptable.'

Discussions are being based around a formula put forward by Switzerland which would see a ceiling placed on tariffs across all product lines - of 10 per cent for developed countries and 15 per cent for developing - and the total elimination of tariff peaks.

A tariff peak is an exceptional item within the general system of tariffs where a government singles out a particular product for harsher treatment, for example an 18 per cent duty on preserved fish.

Instead of dealing with the issue, Mr Vaile said, the EU team insisted on raising the issues of cotton, export assistance and the structure of a package aimed at improving the lot of the world's least developed countries.

'You hear them talking about all these things but you don't hear them talking about the key issue that is central to this round, and that is market access.'

He noted, however, that when talks about market access swung from agriculture to industrial products, the Europeans suddenly became great fans of tariff reduction.

'Australia takes a very principled stance on this,' Mr Vaile said. 'We are pro-Swiss Formula on both. That is a harmonising formula that brings greater equity into the global trading system.'

Mr Vaile remained upbeat that serious progress towards an agreement could be made before the end of the meeting on Sunday, but it would require greater resolve than was now in evidence.

'It would be fair to say now that the focus has been brought to bear on the critical issues and the political commitment from some quarters - not all - is continuing to grow, and that is a positive,' he said.

'There still are some sensitivities to some issues and it remains to be seen if we can bridge across the gap on those before the end of the weekend.'

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