US, India Clash As WTO Talks Collapse

The prolonged Doha round of global trade talks came to a screeching halt on the newest session’s ninth day, following a clash over agriculture between the US and emerging powers such as China, India, and Indonesia. The US and India failed to find a compromise on measures intended to help poor countries protect their farmers against import surges, reported a diplomat. In the seventh year of discussions, negotiators in the Doha trade round are frustrated. "We were so close to getting this done," U.S. Trade Representative Susan Schwab told reporters at World Trade Organization headquarters in Geneva, according to Reuters.

The round could be delayed for several more years if countries do not agree on the core agriculture and industrial goods chapters. Washington had opposed a push from India, China, and Indonesia to secure protective measures for their farmers if faced with sudden surges of cheap farm imports. Developing exporter countries like Uruguay and Costa Rica also rejected the proposal, fearing it would shut them out of growth markets for food in other developing nations.

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Substantial progress that had been made on other agricultural, manufacturing, and services trade issues are held up by the impasse.

"I think it’s a strong negative and it really follows on the heels of a retreat from globalization and trade that were really the building blocks for the prosperity of the last several decades. It’s scary," said Michael Darda, chief economist at MKM Partners in Greenwich, Connecticut.

Due to long implementation periods for the measures under discussion – typically 5 years for rich countries and up to 14 for new developing members like China – the failure to reach an agreement will not have any immediate impact on trade.

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