US farm talks offer gets guarded response at WTO

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GENEVA, Sept 21 (Reuters) Trade diplomats gave a guarded response on Friday to a U.S. offer to slash its maximum farm subsidies but the mediator of the World Trade Organisation (WTO) agriculture talks said he saw significant progress.

''There are real negotiations going on,'' said New Zealand's WTO ambassador Crawford Falconer, who chairs the agricultural negotiations.

Falconer told reporters he was ''reasonably confident'' other trading powers would conform to the ranges of subsidy and tariff cuts he proposed in a July negotiating text, following Washington's indication that it would do so this week.

''They are arguing about what might work,'' he said.

Negotiators have been focusing on agriculture since the beginning of September, when talks resumed in Geneva after a month-long break during which diplomats mulled over proposals from Falconer and his industrial goods counterpart meant to help bring the nearly six-year-old talks to a conclusion.

Diplomats said the shift in the U.S. position on agriculture could spur advances in other contentious areas of the talks, including industrial goods.

Talks in that area, known in trade parlance as ''non-agricultural market access'' or NAMA, restarted at the WTO this week.

''Every sign of progress in agriculture will also be a positive step to make progress in other areas, like NAMA,'' said Eckart Guth, the European Union's WTO ambassador. ''Progress in agriculture should also trigger progress in other areas.'' WTO Director-General Pascal Lamy has said the drive for a global pact known as the Doha Round, which was launched in 2001 to boost cross-border commerce and help poorer countries export their way out of poverty, is at a ''make or break'' stage.

KERNEL OF DEAL Negotiators are aiming for the kernel of a deal by the end of the year, before the U.S. election campaign makes any agreement more difficult politically.

The long-stalled agriculture negotiations got a boost this week when the United States agreed for the first time to cap its trade-distorting farm subsidies in a range proposed by Falconer.

That offer is dependent on other countries also accepting the ranges suggested in the July text, for instance on tariffs.

''We've not rejected the text. We've always said the text is a good basis for negotiations,'' was as far as India's WTO ambassador Ujal Singh Bhatia would go.

Japan's ambassador to the WTO, Ichiro Fujisaki, said Tokyo had not agreed to any figures on farm trade.

''Including ranges, we have never said that is acceptable,'' Fujisaki told reporters at the WTO headquarters.

The farm talks will break for two weeks now as countries work together in small groups and delegates consult with their governments. They resume for two weeks in the week of October 8, when the industry negotiations move on to substantive issues.

''A wise person would use those four weeks as if that's the last time they had,'' Falconer said.

REUTERS MP RK2104

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