The World Trade Organization (WTO) adopted a framework agreement in Geneva early Sunday to end export subsidies on farm products and cut import duties across the world, a key step toward the conclusion of a full global treaty which has been discussed since 2001.

The compromise agreement adopted by a consensus of the 147-member body opened way for the revival of the Doha Round trade talks, which was launched in 2001 and has been in trouble since the collapse of talks almost a year ago in Cancun, Mexico.

The framework agreement was reached soon after key members agreed to lower subsidies for farm products, the toughest issue ofthe Doha Round.

After overnight negotiations, the United States, the European Union, Japan and some other rich members agreed Sunday morning to eliminate export subsidies at a date yet to be set and to limit other subsidies and lower tariff barriers.

Agreement to cut agricultural subsidies and impout duties

The framework agreement commits WTO nations to lowering import duties and reducing government subsidies in three major areas of international trade, including industrial products, agriculture and service industries such as telecommunications and banking.

The agreement agrees to eliminate export subsidies and other forms of government support for exports, while considerably cutting other subsidies. It includes a "down payment" that would see an immediate 20 percent slash in the maximum permitted payments by rich nations.

The highest agricultural import tariffs will face the biggest cuts. Meanwhile, countries will have the right to keep higher tariffs on some of the products considered most important to them.

Tariffs on industrial products also will be cut according to a formula, but the exact details have yet to be established. Developing countries will have more time to make the changes.

The deal also approves the launch of new negotiations on trade facilitation, and further facilitating exchanges of goods by streamlining customs procedures.

Framework widely applauded by membernations

"Better late than never," WTO spokesman Keith Rockwell told reporters after the adoption of the agreement, while WTO chief Supachai Panitchpakdi said at a news conference later that "this is a historic moment for this organization."

"The momentum is such that it is difficult not to conclude (successfully)," Brazilian Foreign Minister Celso Amorim told reporters at the WTO's headquarters.

"I think that it is going to be approved," said India's Commerce and Industry Minister Kamal Nath.

Nath said developed countries, such as the United States, the European Union and others, will also benefit by removing heavy agricultural subsidies from their budgets.

"It is incredibly important for Canada and for the world," Canadian Trade Minister Jim Peterson said. "We have a historic opportunity to get rid of agricultural subsidies and open up the world, particularly the developing world," he said.

According to the World Bank, successful conclusion of the roundwould inject billions of dollars into the world economy and lift 500 million people out of poverty.

Fremawork paves way for conclusion of treaty next year

The framework accord will set back in motion the stalled round of trade liberalization treaty talks launched by WTO members in Doha, Qatar, in 2001, but delayed by the failure of the body's ministerial meeting in Cancun, Mexico, in September last year.

The Cancun meeting, or the 5th Ministerial Meeting of the WTO, failed to reach accord as disputes on the agricultural subsidies remained an obstacle for success.

The poor members denounced the rich ones for their yearly spending of 300 billion US dollars in subsidies each year to protect their agricultural producers from cheap imports.

The United States and Europe, who are facing mounting pressure to show flexibility, said they would open their markets if the so-called Group of 20 developing nations softens its demands.

This week's agreement is referred to as a "framework" because it only sets out a series of principles for liberalization but stops short of giving details. The new framework gives focus and direction to the trade discussions, and makes it more likely that a full treaty can be worked out next year.

Source: Xinhua