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World trade ministers prepare for talks -

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World trade ministers prepare for talks

Broadcast: 19/09/2006

Reporter: Helen Brown

Trade ministers from 18 nations are in the Queensland city of Cairns preparing for two days of
intense negotiations to try and find a way to re-start talks about world trade.

Transcript

TONY JONES: Well, ministers from 18 nations are settling into the tropical Queensland city of
Cairns tonight, preparing for two days of intense negotiations to try to find a way to restart
world trade talks. The PM, and the Trade Minister and Deputy PM, Mark Vaile, is asking for the
nations to cut tariffs and the level of support given by individual countries to farmers by a
further 5 per cent. The stakes are high for the so called Cairns Group. It has to find a way to
convince heavyweights, such as Europe, and developing nations like India to come back to the
negotiating table. Helen Brown reports.

HELEN BROWN: Farm leaders have converged on Cairns to meet the ministers and deliver a clear
message.

DAVID CROMBIE: We're calling on the ministers, in their meetings tomorrow, to be ambitious, to be
brave and to deliver.

HELEN BROWN: The farming representatives are worried that talks about the further reform of world
trade won't restart unless some significant changes are made by the 150 participating nations. The
DOHA round, as it's called, stalled earlier this year when the key players refused to further
reduce tariffs or the level of money and support given to their own farmers.

ALEJANDRO DELFINI: DOHA must be relaunched somehow, and the sooner the better. We have a
tremendous, tremendous responsibility.

HELEN BROWN: The Cairns Group was set up by farm exporting nations in a bid to gain fair and
increased access to international markets. Twenty years later the forum has moved back to where it
started. But it could be argued that the stakes facing the group are now much higher.

PETER GALLAGHER: Over the past few years those surpluses and deficits have grown to the point
where, sooner or later, the market is going to adjust them.

HELEN BROWN: The World Bank has come out today and said the trade impasse is a threat to economic
growth. Peter Gallagher was involved in the setting up of the Cairns Group. He says the latest
warnings show how critical the trading situation is compared to 20 years ago.

PETER GALLAGHER: Over the past few years those surpluses and deficits have grown to the point
where, sooner or later, the market is going to adjust them. The best way to guarantee that they'll
adjust smoothly, rather than sort of cataclysmically as they did in the '97 Asian financial markets
crisis, would be reduce to trade barriers.

HELEN BROWN: The US and European Union blame each other for the stand off in negotiations. Already,
the EU's Chief Trade Negotiator, Peter Mandelson, has rejected the Australian plan, describing it
as unfair and unacceptable. That means fast growing nations, such as India, are also less likely to
expose their farmers to greater world competition.

PETER GALLAGHER: There is a serious threat that the European argument to developing countries,
"Look, let's not do this because it threatens your agricultural employment in the short term,"
there is a serious threat that that argument will work.

HELEN BROWN: The head of the World Trade Organisation, Pasquale Lami, has said that if the talks
are to restart, it has to be by around March next year.

The nation's farmers are also having to face the difficulties posed by the weather. The Government
forecaster, ABARE, says a lack of significant rain across grain growing regions means this year's
harvest of crops such as wheat and barley is likely to be down 36 per cent on last year. Farm
leaders say many farmers had already faced a prolonged dry period before this year's dry conditions
set in. Helen Brown, Lateline.