EU backs Mandelson to push on with WTO talks

BRUSSELS, July 23 (Reuters) European trade chief Peter Mandelson said he won the backing of EU governments to press on with struggling global trade talks, despite concerns about last-gasp compromise proposals outlined last week.

Mandelson met trade ministers from the 27 European Union countries to discuss the bloc's response to the rescue proposals drawn up by mediators at the World Trade Organisation (WTO).

''There was strong backing for continued engagement (at the WTO) in Geneva and there was backing for the approach of the European Commission,'' Mandelson told Reuters yesterday after the meeting.

''At the same time there are real concerns among some member states about some aspects of the texts,'' he said.

The WTO's Doha round of negotiations for a global free trade deal run the risk of being put on hold for several more years or all-out collapse unless a deal can be struck soon.

The round was launched in 2001 to boost the global economy and help developing countries use trade to fight poverty.

Last week, diplomats chairing WTO talks on the core issues of farm and industrial goods floated proposals to break the deadlock.

Mandelson said the EU was worried by the proposals on how the bloc should open up its protected markets in farm goods that it considers ''sensitive'', such as beef or dairy products.

He said the EU was also concerned that services -- the driver of Europe's economy -- were being overlooked as countries continued to haggle over farm and industrial goods. It also wanted more emphasis on global rules for trade and help for developing countries to build their capacity to export, he said.

''I will write in the coming week to (WTO Director General) Pascal Lamy to emphasise this,'' Mandelson added.

Asked about concerns among European employers and farmers about the texts, he said: ''These texts are not perfect from anyone's point of view. But they spread the pain fairly evenly.'' FRANCE LESS HOSTILE EU diplomats at last evening's meeting over dinner in a luxury hotel in Brussels said only Poland and Ireland repeated their accusations that Mandelson was going too far on agriculture, while his main critic, France, was less hostile.

French Secretary of State for Trade Herve Novelli said the proposals required ''substantial improvement.'' ''The big majority of the member states consider that they are not acceptable as they stand now, and that is also the view of the commissioner,'' Novelli told Reuters. ''The Commission is going to have to work very, very, very hard.'' ''The general view is the texts are a basis for negotiation but we are still far from getting a deal,'' said Manuel Pinho, the economy minister of Portugal, currently EU president.

For the Doha round to be done, the United States will have to cut farm subsidies and big developing countries led by Brazil and India will have to open their economies further.

Negotiations resume this week in Geneva with a view to a ministers meeting aimed at a breakthrough possibly in September.

REUTERS CS PM0517