Diplomats in charge of world trade talks challenged countries on Tuesday to abandon long-held positions and make very painful compromises on farm and industrial goods to salvage a deal.
Their proposals are seen as possibly the last chance to save the so-called Doha round of trade talks, which has lurched from crisis to crisis since it was launched in Qatar in 2001 to help lift millions of people out of poverty.
In an attempt to break the deadlock, diplomats chairing the WTO negotiations floated detailed texts spelling out ranges of cuts for farm subsidies and a formula for import tariff cuts for agricultural and industrial goods.
Some of those narrow ranges or target numbers or technical draft text will be very painful, for sure. But that pain will be required to get agreement, said New Zealand's ambassador to the WTO, Crawford Falconer, who chairs the agriculture negotiations.
While countries will undoubtedly find faults with the new texts, what separates members today is smaller than what unites them, WTO Director General Pascal Lamy said.
It is essential that members focus efforts into overcoming those differences, Lamy added, noting there was already an impressive deal within reach.
Under Falconer's plan, the United States would have to cut a ceiling for farm subsidies to between $13 billion and $16.4 billion a year, lower than its offer of $17 billion.
The European Union would have to cut its highest tariffs on farm imports by 73 percent, more than its offer of 60 percent.
Don Stephenson, Canada's ambassador to the WTO and chairman of the industrial goods talks, said countries needed to search for balance between their competing interests.
This text is a bridging exercise, he told a Geneva news conference after proposing developing nations should accept deeper cuts to manufacturing tariffs.
The texts leave many difficult issues unresolved, but provide a framework for countries to work toward a final agreement by early 2008.
Both chairs deserve a lot of credit putting together papers that are going to challenge everybody, but are not completely out of the universe, a Bush administration official said.
Developing countries would have tariffs for industrial goods below 12 percent on average and only a handful would have them above 15 percent, although the poorest countries would be permitted to maintain higher average duties.
Developed countries should cut tariffs to below 3 percent on average, with peaks, or individually high duties, under 10 percent, Stephenson said.
Trade diplomats say reactions to the proposals from WTO countries will determine whether the Doha round can be wrapped up in 2007. WTO chief Pascal Lamy has warned that without a deal this year, the talks could be put on ice for several years.
The EU welcomed the proposals as a useful step forward, but warned it had important concerns and other significant issues in the negotiations that are not included in these texts.
The United States, India and Brazil, other core members of the WTO, said it was too early to comment, although Washington said it hoped the new texts could pave the way for a deal.
U.S. business groups called the texts a sign of progress, but urged negotiators to push for a final formula that would require advanced developing countries like Brazil, Argentina and India to make deeper industrial tariff cuts.
Disputes over farm and industrial goods have dogged the Doha round negotiations for years.
If the chairs' proposals are well-received, diplomats say trade ministers could be called to Geneva this fall for another try at concluding the deal that the World Bank says could add $96 billion annually to the global economy.
This deal is still doable, Stephenson said. This deal is still within the members' grasp if they want it.
(Additional reporting by William Schomberg in Brussels)