Breathing life into struggling world trade talks, the United States has signalled its willingness to limit trade-distorting farm subsidies to a level between US$13 billion and US$16.4 billion, the World Trade Organisation's (WTO) lead farm trade negotiator said yesterday.

Crawford Falconer of New Zealand said Washington made the move contingent on other countries accepting proposed cuts in agricultural tariffs. The U.S. has never said publicly it could accept a cap on payments to American farmers below around US$23 billion.

The question of rich countries' farm subsidies has been a major stumbling block in the WTO's six-year effort to liberalise world trade.

Cutting tariffs

"I thought it was very con-structive," Falconer said at the WTO's Geneva headquarters, where he has been chairing intensive agriculture talks, since the beginning of September, aimed at bridging differences between rich and poor nations over proposed subsidy and tariff cuts. "That probably justifies three weeks of work in itself."

Sean Spicer, spokesman for the U.S. trade representative in Washington, said he could not immediately comment.

Several WTO diplomats present at the meeting confirmed that chief U.S. farm trade negotiator Joe Glauber said Washington accepted the proposed subsidy range if other countries agreed to Falconer's plan for cutting tariffs on farm products.

For the 27-nation European Union, for example, that would mean a reduction of its highest farm tariffs by 66 per cent to 73 per cent.

The global trade talks known as the Doha round aim to add billions of dollars to the world economy and lift millions of people out of poverty.

But they have repeatedly stalled since their inception in Qatar's capital in 2001, largely because of wrangling over eliminating barriers to farm trade and, more recently, manufacturing trade.

New proposals

Two new proposals, one by Falconer and another by chief industrial trade negotiator, Don Stephenson of Canada, were released in July in an attempt to force countries into bargaining.

The drafts also aimed to erase a major failure in June by the U. S. the E.U., Brazil and India to hammer out the blueprint of a deal, which is already three years behind schedule.

At that meeting, officials said the U.S. indicated it was willing to limit annual farm subsidies to US$17 billion, an offer that was rejected by Brazil and India.

"We would have liked to have had more clarity on where in the range the U.S. was willing to go, but I think it's an important initial step," said Ambassador Clodoaldo Hugueney of Brazil, a major agricultural exporter that has been one of the most adamant that Washington deliver real cuts in subsidies.

Washington spent only US$11 billion on trade-distorting subsidies last year, but the Bush adminis-tration wants flexibility in the event that greater assistance to farmers is needed because of a decline in world agricultural prices.

Subsidies criticised

Critics of the subsidies say they drive down prices, making it impossible for small farms to compete in international markets, and more difficult for poorer countries to develop their economies by selling their agricul-tural produce abroad.

- AP