MercoPress. South Atlantic News Agency

No Deal in Free Trade of Americas Talks

Deputy ministers from 34 nations in the Americas failed to reach agreement Friday on a framework for the Free Trade Area of the Americas, stymied by differences on the contentious issue of U.S. farm subsidies.

"The negotiations have reached an impasse ... we have not agreed on any text," Argentine negotiator Martin Redrado said after four days of meetings in this colonial city 65 miles southeast of Mexico's capital.

The talks in Puebla followed November meetings in Miami when negotiators came up with an outline for an accord that was dubbed "FTAA-lite," a two-tier approach in which all countries would sign on to basic trade rules, while those that chose to could open their markets further.

World Trade Organization talks in Cancun collapsed in September over the same farm-subsidies issue.

In the Puebla talks, the Mercosur nations ? led by Brazil and Argentina ? demanded measures like compensatory tariffs to protect their markets from the price effects of domestic U.S. farm payments. U.S. officials insist the farm topic should be negotiated within the WTO.

The Mercosur countries dropped twin demands for an end to all farm subsidies, and a 15-year phase-out of tariffs on all products. They reportedly offered to allow tariff or quota protections for about 10 percent of goods, something the United States had wanted.

"This is not a new Cancun, because (the negotiation process) will continue," Redrado said.

But Redrado said that without an agreement on agriculture ? and implicitly a U.S agreement to abandon most farm subsidies ? there would be no FTAA.

The negotiators agreed to attempt a new round of talks in 30 to 40 days to try and resolve their differences.

"We see this as a failure for them," activist Alberto Arroyo of the Continental Social Alliance said of the talks. "This is very similar to what happened in Cancun, as regards agriculture."

Despite the lack of a final agreement, negotiators did decide to stick to their 2005 deadline for a final accord, and agreed that smaller, less-developed countries would need special help to compete in a hemispheric pact.

Agricultural subsidies have been a sticking point in free trade negotiations around the globe. The Mercosur nations say subsidies rob their farm sectors of foreign markets and make their own farmers unable to compete domestically.