Key trade ministers say good basis for Doha pact this year

DAVOS/SWITZERLAND: Leading trade ministers on Saturday said there was a "sound basis" for agreeing a new global free trade pact this year amid growing fears about protectionism as the economic crisis bites.

Ministers from 18 economies met on the sidelines of the Davos forum, saying afterwards that they would push to overcome their differences early this year in the so-called Doha Round of World Trade Organization (WTO) negotiations.

"We recognise the major progress made in 2008 towards finalising modalities in the Doha Development Round, which provides a sound basis for an early resolution of the remaining differences in 2009," a declaration endorsed by the ministers said.

There was no permanent US negotiator at the meeting, however, which brought together key emerging powers Brazil and India as well as European and Asian ministers.

Acting US Trade Representative Peter Allgeier endorsed the statement.

Ministers have been struggling to agree a trade deal since talks were launched in Doha in 2001 and regular pledges to make progress and complete the round have come to nothing.

World leaders had pledged in a meeting in Washington in November to agree a framework agreement before the end of 2008, but World Trade Organsiation chief Pascal Lamy called off a mooted December gathering due to a lack of consensus.

Swiss Economy Minister Doris Leuthard, host of the meeting here, set out a possible timetable for talks, saying ministers could meet before a G20 summit in April, then again in June, before a full meeting in Geneva in July.

"All of us have expressed a strong commitment to finalise the Doha negotiations but this is not enough. We need a commitment on the starting point," she told reporters.

"One important element will be in the next weeks and months if every member says yes (to the restarting process), that we do not begin with backtracking. The starting point of our discussion is what we discussed in July, up to December."

WTO members were seen as coming close to agreeing a deal in July in Geneva, but talks fell apart after more than a week of intense negotiating amid mutual recriminations from rich and poor countries.

Fear of protectionism has stalked this year's Davos meeting, with leaders and business officials stressing the danger that the next phase of the economic crisis could be government policies that crimp trade.

The worry is that anger at job cuts resulting from the financial crisis and the use of public money in bailouts could lead governments to enact policies to favour their national companies and close their markets to foreign products.

A new global trade pact is seen by leaders as a way of preventing this, by binding countries into rules that are monitored by the Geneva-based WTO.