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. Last Updated: 07/27/2016

France Threatens to Exit WTO Talks

DOHA, Qatar -- France threatened Tuesday to walk away from negotiations to launch global trade talks over the explosive issue of farm export subsidies, despite two years of work by the World Trade Organization to recover from Seattle's embarrassing failure.

"Really it is a sort of deal-breaker point," said French Trade Minister Francois Huwart over demands by other nations for an agenda that would see a "phasing out" of the subsidies.

Huwart's comments to journalists came hours before the midnight deadline, after five days of talks among the WTO's 142 members on a declaration that would set out the road map for a new trade round.

The declaration must be agreed to by all members. That didn't happen in 1999 in Seattle -- partially over the same issue -- dooming those talks.

Tuesday morning, negotiators were claiming "positive momentum" from a draft agreement to ensure poor countries have access to lifesaving drugs.

Senior U.S. trade negotiators said that "very substantial progress" had been made over four days of talks and a deal was "definitely very doable."

Trade ministers had the draft of an agreement on access to patented drugs for poor countries, as well as one to include a mandate to look at tightening anti-dumping rules, which developing countries wanted but Washington, worried about its steel and textile industries, had resisted.

Negotiators said agriculture was one of the last main stumbling blocks.

South Korea, Japan and Norway have agreed to a proposed text calling for the eventual "phasing out" of farm export subsidies, leaving the 15-nation European Union, and especially France, essentially alone.

France, which benefits the most from the EU's farm budget, has a strong farmers lobby and a presidential election just six months away.

"We would accept failure of the round rather than a bad agreement," said Jean-Michel Lemetayer, president of France's main farmers lobbying group, who is in Doha.

U.S. and other trade negotiators suggested the EU might be able to agree to talks on a phaseout of subsidies if gains could be made in other areas of importance to Europe, such as environmental and antitrust issues.

But Huwart said France and the EU as a whole would never accept the words "phasing out."

"We must try to find other wording," he said.

The draft being submitted Tuesday also dropped anti-monopoly issues, which developing countries had vehemently opposed. They said it was "extremely premature" for poor countries to try to take on antitrust matters while they are still struggling to find their economic footing.

Many also fear environmental rules would be used as a cover to keep goods from poor countries out of the EU. An EU spokesman said negotiations were continuing on that.

It appeared that developing countries had also managed to keep strong language on labor standards out of the final text.

The draft agreement simply recognizes that the International Labor Organization "provides the appropriate forum for a substantive dialogue" on this issue. The EU had wanted the labor organization to have some direct linkage with the WTO.

Other remaining areas of disagreement involve textiles. India and other developing countries want faster elimination of tariffs and quotas by Western countries.

Indian Commerce Minister Murasoli Maran has called the issue a potential deal-breaker.

However, a senior U.S. negotiator said African countries as well as Pakistan had recognized that U.S. officials could do little without action by Congress.

"We're not refusing to negotiate textiles," he said. "What we're saying is we can't do any more unilaterally."