WTO rich balk as poor demand more

HONG KONG, Friday (AFP) - A WTO development package that aims to boost trade in developing nations by providing duty-free, quota-free access to imports has drawn fire from poor countries.

A block of least developed countries that includes Bangladesh, Nepal and Zambia doubt that a proposal under negotiation at WTO talks here would completely eliminate tariffs and quotas for the globe's impoverished.

The deal, held up as a beacon of hope in the four-year-old Doha round of trade talks that have stalled over EU agricultural subsidies, is only a small part of a general agreement aimed at trade liberalisation.

But with the US balking over free entry of Bangladesh textiles to its market and Japan stuck on rice, the tariff and quota proposal seems to be unravelling as poor countries fear the rich will not make good on their promises.

"I can understand that all countries have separate areas that are sensitive," Zambian Trade Minister Dipak Patel told AFP.

"But duty-free is meaningless when each country decides a number of tariff lines," said Patel, who leads the 37-member coalition of least developed countries that includes the Solomon Islands and Ethiopia.

Least developing countries are already incensed that their small economies are often subject to disproportionately high tariffs and have repeatedly warned they will vote down a deal that does not address their concerns.

"What is wrong with us graduating to middle income countries?" said Patel. "What does it cost rich countries?"

US trade officials have singled out Bangladesh for possible exclusion from full access to duty-free, quota-free privileges because of the strength of its textile industry.

At first glance Bangladesh appears to be punching well above its weight. But while its overall exports are valued at only 2.3 billion dollars, textiles account for two billion dollars of that figure.

The country paid 329 million dollars in import tariffs to the United States last year, while Canada, which exported six times that, paid only 100 million dollars.

Mir Nasir of the Federation of Bangladesh Chambers of Commerce and Industry called the policy "not economically sensible" and blamed Washington politics.

Although US Trade Representative Rob Portman has admitted that domestic politics tie his hands in trade negotiations, he defends the access Washington already grants to developing countries.