Trade ministers from around 30 states met on Saturday to try to breathe new life into global trade liberalisation talks, stalled on issues such as farm reform and access to life-saving drugs for poor states.
Highlighting the difficulties faced by the Doha Round of trade talks, the ministers met in this Red Sea resort just after the European Union again failed to forge a deal to reform its euro 40 billion ($46.76 billion) a year farm support policy.
World Trade Organisation chief Supachai Panitchpakdi said ahead of the meeting that he hoped the Sharm el-Sheikh talks, which include US Trade Representative Robert Zoellick and European Trade Commissioner Pascal Lamy, would be able to find areas of flexibility in countries' negotiating stances.
He was hopeful the EU, whose efforts to reform agriculture policy will be key to the success of the Doha Round, would eventually be able to agree a deal.
"Not being able to agree does not mean there will be no progress. We all feel hopeful there will be some achievement coming out of the Luxembourg meeting," Panitchpakdi said, referring to another round of EU farm ministers talks planned for next week.
EU farm reform is vital as, according to Organisation for Economic Cooperation and Development estimates, it hands out some $100 billion in subsidies each year. This compares with around $40 billion each in the United States and Japan.
The June 21-22 Sharm el-Sheikh meeting is a key part of the run-up to a ministerial meeting of the 145-member WTO in Mexico in September, whose success could decide whether the trade round finishes on time at the end of 2004.
As well as the difficult issue of farm reform, the trade ministers will discuss a range of topics, which have become bogged down at the WTO, such as a system to give poor countries more access to life-saving drugs by waiving patent rules.
US blocking drugs deal
This is one of those areas close to the heart of developing nations, for which the Doha Round is supposed to bring greater benefits from the world trade system, as well as leading to greater overall liberalisation of global commerce.
The WTO is trying to work out a system to waive patent rules to let poor nations with no drugs industry import cheap, usually generic, drugs for diseases like AIDS, tuberculosis and malaria.
But the United States could face criticism in Egypt for blocking a drugs deal, accepted by all other states, as its powerful pharmaceutical industry fears it could give a free hand to developing world producers of generic drugs to steal markets.
"I think it is necessary that we solve the problem for the developing countries, for the poorest countries, and give them the chance to fight against these diseases," said Swiss Economy Minister Joseph Deiss, whose country also has a big pharmaceuticals industry.
"On the other hand, it is important that we maintain efficient research in the pharmaceutical domain and that we can protect this intellectual property," he added.
Both Pakistani Trade Minister Humayun Akhtar Khan and Indian Trade Minister Arun Jaitley said they wanted progress on the drugs issue and how to give developing countries special terms for meeting WTO rules, particularly in agriculture.
"(This) would be of paramount importance in safeguarding the interests of the 650 million farmers, who depend on agriculture for their livelihood," Jaitley said in a statement.
The special terms for developing nations and means of easing tariffs on industrial goods are other issues, which have become bogged down at the WTO talks.
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