EU treaty casts shadow over Doha deal

As the future of the European Union's (EU's) reform project hangs in balance following Ireland's rejection of the Lisbon Treaty, doubts are being cast whether Brussels will be able to sell the Doha agreement to its member states, trade diplomats said.

EU leaders congregated in Brussels yesterday to bring the Lisbon Treaty, which aims to bring fundamental reforms in governing the 27-member body, back on the rails. The treaty was resoundingly defeated by Irish voters last week on several grounds that include, among other things, their opposition to providing market access for beef, pork and dairy products to leading farm exporters like Brazil, Argentina, Australia and New Zealand.

Although EU Trade Commissioner Peter Mandelson campaigned hard to convince the Irish farmers that their interests would be protected at every cost and agreed to include a veto for accepting the final Doha commitments, he was unable to allay the fears harboured by Irish farmers, said an Irish farm trade analyst in Geneva.

Ireland has a history of rejecting treaties, especially when they are pushed hard by successive governments and Brussels, the analyst said.

The Lisbon Treaty has to be ratified by all 27 members in order to come into force. However, indications are that it is unlikely to take effect on January 1, 2009, as scheduled, because of the Irish slippage.

On Wednesday, Britain managed to endorse the new treaty by choosing parliamentary approval over referendum. There are still eight other EU member countries that need to endorse the treaty.

Significantly, the defeat of the treaty could not have come at a worse time for Mandelson, who is the main force behind the ongoing efforts to finalise the modalities agreement in Doha agriculture and market-opening for industrials.

"It is like the Doha cake being readied for a party on the terrace and suddenly the house lady is screaming about the fire in the kitchen," said a trade envoy from an industrialised country. If the EU is busy fire-fighting on account of the rejection of its main reform project, it may not be the best time to sign on another project, which is being opposed by farmers in France, Ireland, Portugal, Poland, Italy, and Spain, the envoy said.

On July 1, the presidency of the EU shifts to France, which is not a keen supporter of the Doha project. French President Nicolas Sarkozy said the focus of the French presidency would be tackling immigration, boosting European defence capabilities, developing a strategy for the security of European energy suppliers and fresh efforts to address the climate change issue. He has not indicated how France will lead Europe in concluding the beleaguered Doha agreement.

Besides, several European industry coalitions are angry over lack of adequate market access opportunities in the three big, emerging markets