After six days of public posturing and haggling, negotiators at the World Trade Organisation's Hong Kong ministerial made almost no progress on the issues at the heart of the Doha round of trade talks: cutting farm tariffs, freeing trade in industrial goods and opening services markets. A deal cleared by the Ministers set 2013 as an end date for farm export subsidies, extended some help for the WTO's poorest states and offered little to African cotton producers. Agreement in Hongkong is seen as vital to WTO hopes for a draft trade treaty early in 2006, which could inject billions of dollars into the global economy and lift millions out of poverty.

The reactions were predictably different. "The relief in the room is palpable. Everyone shares the sense we've succeeded, not completely... but with an impetus to finish the Round in 2006 - says the noting in the conference diary of Pascal Lamy . While developing countries gave it a cautious welcome. "India welcomes this final revised draft. From going round and round about we now seem to be setting course to a development agenda," said Commerce and Industry Minister Kamal Nath who represented India.

A result of six days of tough negotiations and bargaining between rich and poor nations, came the compromise text, that was approved by the full 149-state membership gathered for a ministerial conference in Hong Kong. It proposed eliminating export subsidies on cotton--a sensitive issue for the United States--in 2006, and proposed April 30, 2006, as a deadline for reaching a draft pact for the wider Doha trade round. It left open the possibility of dismantling rich nation cotton subsidies, a key African demand, at a faster pace than would eventually be agreed for all farm goods under a final deal.

The Hong Kong ministerial meeting had initially been scheduled to sign off on a Doha draft, but differences were so great between states going into the conference that the WTO opted to lower the bar and seek a more modest pact. For Least Developed Countries (LDCs), the text offered duty-free and quota-free access on at least 97 percent of all their goods by 2008, falling short of their demand for 99.9 per cent.

"We agree to ensure the parallel elimination of all forms of export subsidies and disciplines on all export measures with equivalent effect to be completed by the end of 2013," the declaration said. An accord on when to end export subsidies would remove one of the major obstacles to progress in the WTO's Doha round of free trade talks, even if the compromise fell short of the 2010 date that major agricultural goods' exporters like Brazil, Australia and Argentina had been seeking. It is possibly because of the fact that the CAP in EU ends in 2012 and under the French and the Irish pressure the media savvy EU Trade Commissioner successfully ensured that any effort to cap subsidies would be dropped till then.

The so-called development package to the LDCs was in part a symptom of the lack of progress in the main agenda. The package is less generous than it is made to appear by the developed nations and possibly was a way to score political points. The EU, which already gives duty-free and quota-free access to the poorest countries under its "Everything but Arms" programme, and which produces little cotton, saw a chance to embarrass the Americans and divert attention from Europe's own refusal to make deeper cuts in farm tariffs. The Americans offered just enough on cotton and on duty-free access to avoid being painted as enemy of the LDCs.

Most of the development oriented NGOs criticized the so-called gains for developing countries, duty free and quota free, as just little crumbs that will not make up for the price millions of farmers, fisher folk, Indigenous Peoples and others in the developing world will have to pay as a result of the rest of the deal. Developed countries can earmark up to 3 per cent of products - or tariff lines in WTO terminology - where the facility would not be granted. The standard industrial classification used by all member countries specifies 5,000 tariff lines at a high degree of disaggregating. If 3 per cent of this number, or 150 tariff lines, were to be taken out of the scope of duty- and quota-free access, all products of export interest to the LDCs, notably textiles and garments, would effectively be eliminated. For example a country like Bangla Desh would totally lose out if just 3-4 products like tea jute and textile/garments figure in the 3 per cent. Pledges of aid for trade also sounded grand: an extra $10 billion from Japan; a doubling of America's annual commitment, to $2.7 billion, by 2010; a big rise from the EU, too. However, no one seems to know if this truly is new money or what it will be used for. This leaves plenty of room for disappointment-and therefore for obstruction from the poorest countries if a broader deal in future could be a possibility .

The demands of LDCs and developing countries on Annex C in the services sector was rejected under pressure fro developed countries. Annex C threatens to force developing countries into plurilateral negotiations, new disciplines on domestic regulation, and the possibility of an agreement on government procurement on services. These outcomes would have a devastating impact on the ability of countries to build their services sector, to regulate services in the interest of their own people and to ensure access to quality public services for all. Many developing countries have voiced their opposition to this fundamental change in the flexibility provided by the existing GATS infrastructure.

There is also a fear that any move to open markets in farming and natural-resource sectors, will benefit the world's largest corporations, but are likely to have adverse impact on poor and indigenous people, whose only source of livelihood is based access to natural resources . It would be back to negotiations in Geneva now, in next 4-6 months a little away from public and NGO glare and if the developing countries do not show the resolve of Cancun they would suffer in the bargain.