WTO talks collapse over import rules

A bid by the world's major trading powers to salvage trade talks collapsed on Tuesday after the United States, Indiaand China failed to agree on farm import rules, according to officials.

The failureof the discussions between seven commercial trading powers likely signals the end to efforts by the World Trade Organizationto gainan overallglobal tradepact.

The WTO has been trying since 2001 to secure a deal on the rules governingtrade. Butthe prospects for such an agreementhave been damaged by continualdisagreements between Western nations and emerging economic powers, such as India and China, over manufacturing and agricultural rules.

In mid-July, trade officials from a smaller group of countries began meeting in an effort to get the large WTO talks back on track.

This most recent setback, however, could mean the larger negotiations will also fail, a senior source told the Associated Press.

TheUnited States and the European Unionhave been pushing hard for a reduction of tariffs on manufactured products and the lessening of restrictions on farm trade.

India and China, however, have been demanding emergency powers that would allow those countries to protect domestic farmers against import surges from other countries.

These newly-industrializing powers say they need theserightsto prevent small-scale farmers from beingpounded by global agricultural producers, who could drive produce prices down.

Canada defends supply-management regime

The United Stateshas argued that such rules could wind up raising farm tariffs in those countries, an unacceptable result from Washington's perspective.

For its part, Canada has consistently defended this country's supply-management regime, a system of rules and production quotas that, critics say, keeps consumer prices for products, such as chicken, overly high.

"There's no doubt this is a significant setback,"federal AgricultureMinister Gerry Ritztold reporters during a conference call from Geneva. "But we will push ahead with our trade agenda."

Canada will now focus on negotiating more bilateral deals with other countries and trade blocks,said International Trade Minister Michael Fortier.

Canadian farmers sounded alarm bells over a possible failure to get atrade deal.

"To not get a new WTO agreement would mean tariffs can be raised and domestic supports increased to further distort trade," said Darcy Davis, president of the Canadian Agri-Food Trade Alliance, a group representing Canadian beef and pork producers and grain growers.