WTO Negotiators See Little Chance Of Success

European and US trade negotiators warned Thursday that talks for freeing up more global trade would collapse unless developing countries that are demanding an end to rich-world farm subsidies gave some ground on opening up their own markets to Western goods and services, reports The International Herald Tribune.

"We cannot go on as we are with any reasonable chance of success," said Peter Mandelson, the European Union's trade commissioner, as negotiators at the World Trade Organization appeared to be on course to miss another deadline this weekend toward their goal of a deal by December. Rather than negotiating piecemeal - solely on agriculture, for example - the WTO should have broader discussions focusing on trade-offs between countries and sectors, he said. The US deputy trade representative, Peter Allgeier, supported Mandelson in calling on larger developing countries to offer concessions for the round to be a success.

Besides agriculture, the countries have been unable to reach agreement on a number of other issues, like reducing tariffs on industrial goods, freeing up trade in services and tightening rules to protect intellectual property rights. The WTO General Council - its highest decision-making body - will meet Friday. But the gathering will be a formality, summing up the result of discussions held in Geneva over the past week.

The Wall Street Journal Europe writes that Supachai Panitchpakdi, the departing director-general of the WTO, told delegates significant work will be needed through the autumn if they are to succeed and the situation was "disappointing but not disastrous. "What we need urgently is not just a change of gear in these negotiations but also a change of attitude and approach," he said. "Disappointment must be converted immediately into determination." Talks at WTO headquarters this week are a key part of the process aimed at hammering out an accord at a December ministerial summit in Hong Kong.

Reuters further adds Supachai, who will be replaced as WTO Director General by former European Union trade chief Pascal Lamy from Sept. 1, said that although no deals were reached in July there was a clearer idea of just what political decisions would be needed to achieve an agreement in Hong Kong in December. The 148-state WTO had hoped to announce this month a significant advance in the Doha Round of free trade negotiations, but Thursday's meeting of the Trade Negotiations Committee (TNC) and the executive General Council on Friday have nothing to approve. In statements to the TNC on Thursday, chief mediators for the round, which includes agriculture, industrial goods and services, rule changes and development issues, said tough decisions would be needed in September when negotiations resume.

The Associated Press also notes the latest setback leaves little time for incoming WTO boss Pascal Lamy -- who is holding informal talks with ministers -- to broker the comprehensive draft deal scheduled to be approved at a December Hong Kong summit. Thursday's US Congressional approval for the new Central American Free Trade Agreement could give the global negotiations a belated boost. But ministers and trade diplomats now concede there is no chance of reaching a preliminary agreement by the self-imposed July 31 deadline. Ambassador-level talks at the WTO's Geneva headquarters failed to produce a last-ditch blueprint in time for the planned framework deal to be thrashed out this month.

The Financial Times meanwhile writes that despite the EU and US calling on poor countries for more concessions in those areas, these countries are in the unusual position of escaping most of the blame for stalling the overall round. The Group of 20 developing countries that negotiates on agriculture, led by Brazil, has done a remarkable job of hammering out consensus among different developing world interests. It was their compromise proposal for a broad framework for farm tariff reductions that got the first potentially significant concession out of the EU this year in agreeing to adopt it. Having been criticized by the EU and US when it was formed as a defensive response to their joint proposal on agricultural reform before the disastrous Cancun ministerial meeting in 2003, the G20 has, in the words of Brazil's trade minister Luiz Fernando Furlan, "just kept walking". But unfortunately for those who want the Doha round to achieve broad-based liberalization, the diverging interests of developing countries in goods and services trade mean there is no equivalent to the G20 outside agriculture.

ASEAN Fund For Development Set Up At Ministerial Meeting In Laos

The Thai News Service reports Thailand and other member countries of the Association of Southeast Asian Nations (ASEAN) have agreed to set up an ASEAN Fund for Development and to jointly manage disasters and respond to emergency situations. The agreements were signed by Thai Foreign Minister Kantathi Suphamongkhon and his counterparts from the other nine ASEAN member countries following the 38th ASEAN Ministerial Meeting (AMM) in the Lao capital of Vientiane yesterday.

The new ASEAN Fund for Development was transformed from the former ASEAN Fund, and will be used to support development projects of the 10-nation grouping, aimed to help achieve its ambitious goal of the establishment of the 'ASEAN Community' by the year 2020. The regional development projects have been included in the Vientiane Action Plan, also endorsed by the ASEAN member states at the end of the 38th AMM. Every ASEAN member country--Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam--agreed to contribute $100,000 each to the new fund by the year 2007.

Regarding the agreed joint management of disasters and response to emergency situations, all ASEAN member states will define their cooperative framework to achieve the mission goals and will establish an efficient mechanism to help reduce damage and impacts of disasters on peoples' lives and assets, as well as regional economies, societies, and the environment.

The Associated Press meanwhile reports that Asia's biggest security forum focused Friday on fighting terrorism, keeping the Straits of Malacca piracy free and fending off conflicts through diplomacy as it wrapped up an annual session skipped by some of the region's top diplomats. The forum capped a six-day conference of the Association of Southeast Asian Nations that saw Australia shed past reservations and sign a nonaggression pact with its neighbors, joining efforts to build an Asia trade bloc on a par with those in Europe and North America. The ASEAN Regional Forum planned to adopt a new doctrine Friday empowering its chairman to convene committees to intervene to head off brewing conflicts.

Also in Vientiane, the US, Australia, China, India, Japan and South Korea announced a proposal to help control greenhouse emissions by developing cleaner energy technologies. Environmentalists suspected the nonbinding pact could undermine the Kyoto anti-pollution treaty. And saving the ASEAN bloc from a potentially damaging standoff with Washington, Myanmar agreed this week to forgo its rotating chairmanship of ASEAN in 2006. The US had threatened to boycott ASEAN meetings in the military-ruled country in protest of its human rights record and lack of democratic reforms.

Dow Jones meanwhile adds the Thai foreign minister said Friday that military-ruled Myanmar can't take up the chairmanship of ASEAN until it restores democracy, asserting that “the pressure is not off” the junta just because it relinquished the rotating leadership for 2006. Myanmar, facing heat from the United States and the European Union, announced at the six-day ASEAN meeting Tuesday that it will forgo the 2006 chairmanship of the grouping, saying that will be a "critical year" in its national reconciliation process to restore democracy. But it is generally believed that the junta's decision was designed to save ASEAN embarrassment and a punishing boycott of its meetings by the United States and Europe, the region's close trading partners.

Agence France Presse finally notes Asian foreign ministers on Friday welcomed tiny East Timor as the 25th member of the region's main security forum. East Timor became independent as one of Asia's poorest countries in May, 2002 after a period of UN stewardship following a 1999 referendum to split from Indonesia.

World Bank Rebuked Over Water Deal

The World Bank came under fire Thursday after it was revealed that Indian civil servants were repeatedly overruled by Bank officials in their choice of consultants for a multi-million dollar contract to plan the privatization of Delhi's water supply, reports The Guardian (UK). Documents obtained under Delhi's freedom of information act show the bank intervened to the benefit of PricewaterhouseCoopers (PwC), which had failed to make the grade when the Delhi government put out the tender in 1998.

The contract was to produce a plan to privatize Delhi's water supply, which provides a spluttering service to 1.6 million households in a city of 20 million people. It was eventually won by PwC in the teeth of opposition from Delhi's government officials, who constantly ranked it below other bids. Campaigners say PwC's "blueprint for reform" closely mirrors other water privatizations funded by the World Bank. A number of these have failed to deliver promised benefits, notably in Manila and South America. Arvind Kejriwal of Parivartan ("Renewal"), an anti-corruption group which obtained the documents, accused the World Bank of dictating terms and exercising undue influence over an accountable body.

The correspondence between the Delhi Jal Board, which oversees water supply in the Indian capital, and World Bank officials shows that PwC lost three times to rivals during the bidding process. It did not even make a shortlist until Bank officials insisted that "at least one consultant should be shortlisted from a developing country". PwC is a multinational firm but has an Indian subsidiary registered in Calcutta. Papers show that in the second round of bidding, PwC came fifth out of six consultants and again failed to qualify. The World Bank response was to modify the criteria for evaluation and to ask for an "explanation of what exactly are PWC's shortcomings".

Civil servants wrote that the "project could be in jeopardy if the suggestion of the World Bank were not agreed to". PwC was reinstated with higher marks. In the next round, PwC again failed but was allowed to make the cut after the World Bank chose to ignore an expert who had had serious reservations about the firm's expertise. The company clinched the $2m contract in 2001. Last night the World Bank said the events "were broadly correct but the interpretation put on them is not". "There has been no firm favored or discriminated against in the Delhi scheme," said its operations adviser in India, Rachid Benmassaoud.  

Security Costs Slow Iraq Reconstruction; Contract Excesses Also Hamper Progress

Efforts to rebuild water, electricity and health networks in Iraq are being shortchanged by higher-than-expected costs to provide security and by generous financial awards to contractors, according to a series of reports by the Government Accountability Office (GAO) and the Office of the Special Inspector General for Iraq Reconstruction released by Congress Thursday, reports The Washington Post.

The US, Iraq and international donors have committed more than $60 billion to run Iraq and revive its damaged infrastructure. But security costs are eating away a substantial share of that total, up to 36 percent on some projects, the GAO reported. The higher security costs are causing reconstruction authorities to scale back efforts in some areas and abandon projects in others. Heather Layman, spokeswoman for USAID, said security accounts for an average of 22 percent of a project's cost in Iraq.

GAO investigators did find some bright spots: "The US has completed projects in Iraq that have helped to restore basic services, such as rehabilitating oil wells and refineries, increasing electrical generation capacity, restoring water treatment plants, and reestablishing Iraqi basic health care services," the report's authors concluded. In other areas, developments were less auspicious. Despite $5.7 billion committed to restoring electricity service in Iraq, power generation was still at lower levels as of May than it had been before the US invasion in 2003. In a separate report yesterday, the Office of the Special Inspector General for Iraq Reconstruction reported that more money than necessary may be going into the pockets of government contractors involved in the rebuilding process.

Agence France Presse adds the GAO reported that US government agencies and construction contractors were taken by surprise by the Iraq insurgency and have been forced to spend over $760 million on security. The reports found that civilian arms of the US government and firms involved in reconstruction had expected "benign" conditions after the 2003 war. Instead, construction contractors were forced to hastily seek private security protection as the insurgency built, as the US military was not obligated to protect their operations, the GAO study found. Two years on, there are still numerous reports of the military firing on contractors and security details, and it seems as though the military does not understand the role of contractors in Iraq. In a set of recommendations, the GAO called on agencies of the US government to look into incidents where contractors were fired on by US soldiers, often at checkpoints. They also urged officials to train military commanders in the role of contractors in rebuilding Iraq.

In related news, Agence France Presse notes in a separate piece that Stuart Bowen, the special inspector general for Iraq reconstruction tracking billions of dollars spent by the United States to rebuild Iraq said Thursday he has found millions of dollars worth of fraud by US officials and companies. Bowen said the Justice Department had launched a criminal investigation into the fraud. His previous reports have already highlighted huge sums of missing money. He said how $7 million intended for works such as a police station and a library in the troubled Hilla region south of Baghdad had disappeared. The money came from the Development Fund for Iraq, receipts from oil sales that the US-run former Coalition Provisional Authority used for development projects. Bowen said US officials and contractors were involved but would not identify them because of the criminal investigation.

BBC News meanwhile reports that many doctors in Baghdad are making preparations to leave the country. Scientists, doctors and engineers all feel they have better chances outside Iraq. And the long-term implications of the exodus are troubling. Iraq suffered a massive brain drain under Saddam Hussein, when an estimated four million people fled into exile. “Our best professionals left a long time ago,” says one government official. The government has no precise statistics on the problem. But in June, it announced it would double the salaries of university professors in a bid to keep them from leaving the country.

Commentary: AIDS - We Are All Threatened By This Plague

In a commentary published in The International Herald Tribune, Laurie Garrett, senior fellow for global health at the Council on Foreign Relations, writes that we are entering a new stage in the world's great modern AIDS plague in which long-complacent governments are awakening to discover that the HIV virus, first noticed in 1981, now threatens to foment social unrest, undermine state authority, weaken armies, challenge economies and reverse hundreds of billions of dollars worth of development investment.

HIV is a national security concern, for both the highly-impacted societies and for those that have comparatively smaller epidemics, writes Garrett. Five years ago the global community took its first steps toward acknowledging the profound security dimensions of the pandemic by passing UN Security Council Resolution 1308. Earlier this month, Peter Piot, the director of the UNAIDS Program, and Richard C. Holbrooke, who as the US representative to the UN in 2000 authored Resolution 1308, joined me in calling upon the Security Council to declare the world's HIV/AIDS pandemic a global state of emergency.

Under prodding from Britain, the recent G8 summit meeting in Gleneagles agreed to a debt reduction scheme and a multibillion dollar package of assistance to hard-hit nations. Money isn't enough, of course. Countries that lack nurses and doctors or whose aging clinics lack elementary facilities can hardly be expected to provide complicated anti-HIV treatment to millions of needy citizens. The security dimensions of HIV must be addressed with political commitments that go well beyond cash, argues Garrett.

The Economist meanwhile writes that the ABC slogan so beloved by the Bush administration—Abstinence, Be faithful and Condoms—is, in practice, a slap in the face to many people. George W. Bush’s Emergency Plan for AIDS Relief urges that the use of condoms be confined to people who engage in “risky behavior.” Many groups are reported to be ending or reducing their condom-promotion schemes to qualify for American money. [But] the poor countries that have got on top of nascent AIDS epidemics—Brazil, Thailand, Uganda and Cambodia—have done it by changing behavior. It has proved possible because limits have been set on the endeavor: people have not been asked to act morally, merely in their own self-interest, which happens to be in the interest of society. The lesson for rich and poor alike is that to contain AIDS morality must take second place. Politicians may find it easier to yield to sanctimonious lobbyists than to explain why refraining from judging other people makes more sense. But that does not excuse them. Too many lives are at stake.

The Economist also writes that it is no coincidence that Rio de Janeiro was chosen to host this year's Conference on HIV Pathogenesis and Treatment. Brazil's handling of the epidemic is widely regarded as exemplary. In the early 1990s, the World Bank predicted that, by 2000, HIV would have infected 1.2 million Brazilians. Today, five years after that deadline, the total is just half the Bank's prediction—about 600,000.

Brazil, a predominantly Catholic country, hands out free condoms in abundance. Drug users, too, are treated sensibly. Those who inject are offered regular supplies of clean needles and, as a result, three-quarters of them claim never to share needles with others. Prostitutes are the targets of campaigns intended to promote condom use.

The weekly further writes that Brazilian also law gives all residents the right to the best available drug treatment at no cost. The third lesson is to encourage voluntary action. In 1992, Brazil had 120 charities and voluntary groups devoted to AIDS. By the turn of the century, that had risen to 500. The virtues of voluntarism were recently confirmed when the Global Fund. It found that spending by voluntary groups usually produced the best value for money. Further, one must do the sums. One of the arguments that has sustained Brazil's anti-AIDS program is “if you think action is expensive, try inaction”. The government spent $1.8 billion on anti-retroviral drugs between 1996 and 2002 but estimates that early treatment saved it more than $2.2 billion in hospital costs over the same period. Add that to the GDP loss that Brazil would have suffered if the World Bank had been right, and an aggressive program of prevention and treatment does not seem so costly after all.

The Economist finally notes in a separate piece that several mathematical models discussed at the Conference on HIV Pathogenesis and Treatment this week in Brazil suggest that, without a parallel advance in prevention techniques, the spread of effective treatment might even increase the spread of the virus. One way to combat this risk is to use the network that is being put into place to deliver treatment to preach the message of prevention. Another, which is just as important, is to find out which prevention techniques actually work. There is still, for example, argument about whether it was the wider use of condoms or a reduction in promiscuous sex that curbed the epidemic in Uganda, even though that curbing is held up as one of the successes of the global anti-AIDS program. At the moment, condoms and fidelity are indeed the only prevention techniques around, the weekly suggests.

Also in this edition: Madagascar Must Try To Reap More Of A Benefit From Its Plentiful Gemstones; Briefly Noted

MadagascarMust Try To Reap More Of A Benefit From Its Plentiful Gemstones.These days the vast swathes of brick dirt that gives Madagascar its nickname “the Red Island” are pockmarked by small holes: evidence of the search for sapphires, rubies and other precious stones, writes The Economist. Mining accounts for three percent of the country's GDP and one percent of its export revenues, and provides 500,000 seasonal and full-time jobs in a population of about 18 million. But if the government improves the miners' and cutters' skills and curbs smuggling and corruption, the Malgaches would benefit a lot more.

The World Bank hopes that, properly managed, the industry may yield more benefits to ordinary people than elsewhere in Africa, and perhaps bring in as much as $400 million a year. So the Bank and the government have set up the Mineral Resources Governance Project. It teaches diggers and small traders basic gemology and pricing and trains advanced students to become licensed cutters, so helping local Malgaches to get higher prices for their cut stones and compete against the Thais, who dominate the sapphire market. It may also reduce smuggling.

Briefly Noted…BBC News reports that the result of Uganda's referendum on whether to return to multi-party politics is expected on Friday. Reports say participation was low as few people heeded President Yoweri Museveni's appeal for a big vote in favor of democratic change. The opposition had called for a boycott, dismissing the referendum as a waste of time and money. A BBC correspondent in the capital, Kampala, says a return to multi-party politics is widely predicted.

Agence France Presse writes four of Uganda's main foreign donors have issued an unprecedented direct appeal to the rebel Lord's Resistance Army (LRA) to contact urgently the mediator of stalled peace talks, officials said Thursday. In a radio message being broadcast throughout war-torn northern Uganda 18 times a day, the United States, Britain, the Netherlands and Norway are asking LRA leaders to get in touch immediately with mediator Betty Bigombe, they said. It also announces the creation of a special radio monitoring post at which the rebels can pass a message to Bigombe to re-establish contact with her and salvage sinking hopes for a negotiated end to the conflict in the north.

Reuters reports Zimbabwe declared an end to its controversial demolitions of shantytowns on Thursday, a day after the author of a critical United Nations report on the operation briefed a sharply divided UN Security Council. Vice President Joyce Mujuru's announcement that the blitz had ended is not the first time a government official pronounced an end to the "clean up" of urban areas by bulldozing thousands of illegal structures. Mugabe and some of his ministers have said recently the crackdown was over, but police continued demolitions amid rising international outcry, notes the news agency.

The British government has imposed a travel ban on a Kenyan minister. The High Commission in Nairobi issued an advisory notice to major airlines, warning them not to offer air services to Transport Minister Chris Murungaru, reports BBC News. Earlier this year, Murungaru was demoted from the powerful internal security portfolio after allegations of corruption. The UK government had threatened to enforce a travel ban on Kenyan ministers implicated in corruption.

Egyptian President Hosni Mubarak has confirmed that he will stand in the presidential election on 7 September, notes the BBC. It will be the first time the presidential poll has been open to more than one candidate. The Egyptian government says multi-candidate election will bring greater democracy to Egypt. Opposition groups say it is designed to improve Egypt's image internationally without bringing about real change. A growing number of opposition leaders have said they will boycott the election.

Authorities in India are racing against time to prevent epidemics as the death toll from a monsoon reaches 700 in the region around Mumbai (Bombay), writes the BBC. Rescue efforts are continuing amid concerns that large amounts of debris and animal carcasses might lead to outbreaks of disease. Officials says it is unlikely that many more people will be found alive. The rain on Tuesday was reportedly the heaviest recorded in a single day in India: more than 65 cm (26 inches).

The Associated Press reports scientists say the variety of tuna, marlin, swordfish and other big ocean predators has declined up to 50 percent over the past half-century due to overfishing. For the first time, ecologists and oceanographers mapped the hotspots with the largest concentrations of many big fish species, then and now. Their findings are reported in Thursday's online edition of the journal Science. Researchers who had previously reported an overall decline in the abundance of big fish now say there has also been a significant drop in the number of different types of fish such as tuna and billfish being found in many areas. They did find a few places where fish remain abundant.

Secretary-General Kofi Annan appointed Harvard Professor John Ruggie on Thursday as his special representative to deal with human rights issues involving multinational corporations and other business enterprises, reports The Associated Press.

John Bolton, US President Bush's nominee for UN ambassador, neglected to tell Congress he had been interviewed in a government investigation into faulty prewar intelligence that Iraq was seeking nuclear materials in Africa, The Associated Press notes the US State Department said. Bolton was interviewed by the State Department inspector general in 2003 as part of a joint investigation with the CIA into prewar Iraqi attempts to buy nuclear materials from Niger, State Department spokesman Noel Clay said Thursday. His statement came hours after another State Department official said Bolton had correctly answered a Senate questionnaire when he wrote that he had not testified to a grand jury or been interviewed by investigators in any inquiry over the past five years.

Reuters reports Britain began demolishing one of its Northern Ireland army watchtowers -- symbols of its military presence -- on Friday after a pledge by republican guerrillas to end their armed campaign revived peace efforts in the province. The move came as part of commitments by Britain and Ireland to fulfill promises delayed by the Irish Republican Army's past failure to disarm. Pulling down the eight hill-top watchtowers along the Irish border is one of the actions long demanded by Irish nationalists to normalize life in a province slowly emerging from a 30-year conflict in which 3,600 people died.