Global trade negotiators are likely to miss the June-end deadline for finalising modalities in agriculture and industrial goods as there appears to be no climbdown from the stated position by industrialised US and EU and developing countries led by India and Brazil.

Trade ministers, who meet in Geneva during a mini-ministerial of WTO from June 29 to July 2 to thrash out modalities for lowering farm subsidies and industrial tariffs, are still grappling with wide gaps that look almost unmanageable, trade and diplomatic sources said.

The US has given no indication yet on cutting its massive agricultural subsidies more than its October 2005 offer, while the EU has refused to compromise on giving greater agriculture market access.

India, Brazil and other developing countries have made it clear there could be no trade-off on agriculture and have been insisting on steeper cuts in farm subsidies.

On the other hand, the US and EU want them to lower tariffs on industrial goods to allow greater market access. Trade negotiatiors were to finalise the modalities in agriculture and industrial tariffs by April 30 but the deadline was missed as there could be no compromise.

Sources said it was essential for the US to change its negotiating position to reach a deal in agriculture. "We need movement from the US by the end of July, and every indication is they are not moving," a trade source said. Given these problems on agriculture, non-agriculture market access (NAMA or industrial goods) is unlikely to get much attention at the June meeting. 

The pressure now is more on the US to commit to a bigger reduction in domestic farm support rather than on the EU to make further concessions on market access.

The EU looks more flexible as it has indicated that it may go for deeper tariff cuts, in line with the G-20 offer, while the US has refused to budge.

The best that could be expected at this mini-ministerial would be to agree to another high-level meeting at the end of July, sources said.

While analysts differ over how the failure of this mini-ministerial could affect the Doha round of talks, many observers believe that missing this deadline would greatly increase the risk of missing the July-deadline, when members are expected to reach an agreement in services as well.

If member countries fail to resolve differences in the next few weeks, WTO Director General Pascal Lamy could offer a draft text himself based on his own assumptions of what could be a possible compromise on farm subsidies and market access, sources added.

Missing the June and July deadlines could jeopardise the Doha round of talks, which need to be completed by the end of December this year. Moreover, as the US Administration's Fast Track Authority to get trade deals approved in the US Congress expires early next year, a global trade deal would not be possible and Doha round of talks may drag to 2009.

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