The failure of the world's leading industrial nations to resolve differences on trade left the future of global liberalisation talks in Cancun, Mexico, later this year hanging by a thread last night.
Hopes that the G8 summit in Evian would provide political impetus to break the deadlock in the World Trade Organisation (WTO) negotiations were dashed after the rift between the United States and the European Union over agriculture proved too wide to bridge.
Rather than risk the already tense annual gathering of G8 leaders erupting into a full-scale row, the summit pledged to complete the talks on schedule by the end of 2004, but skirted round all the issues that have so far prevented progress.
Despite the failure to make a breakthrough on trade, the leaders expressed confidence that the world economy was poised for recovery. The French President and summit host, Mr Chirac, and the US President, Mr Bush, said their economic discussions had been "very positive". Mr Tony Blair, the British Prime Minister, said there was agreement among the leaders that structural reform in Europe was the key to faster growth.
The statement on trade called for a "further substantial opening of trade in all areas" and urged better market access for all WTO members, particularly poor countries, but left trade ministers with the task of settling disputes on agriculture, low-cost drugs for poor countries, liberalisation of trade in services and cuts in tariffs when they meet in Cancun in early September.
A communique on trade mentioned neither American complaints about an EU ban on genetically modified food imports, nor disputes over support by the US and the EU for their farmers.
The G8 leaders called for fairer trade for poor countries, but, following opposition from the US, made no reference in their statement to a proposal by President Chirac for rich states to suspend subsidies on farm exports to Africa.
With time running out before the Cancun meeting, Mr Blair admitted that finding an agreement would be hard.
The round of trade talks launched in Doha in November 2001 has been stalled since the deadline at the end of March to set the framework for agricultural negotiations was missed.
"The G8's statement on trade is completely vacuous. There is nothing new in it," said Mr Justin Forsyth of Oxfam.
Mr Barry Coates of the World Development Movement said: "The G8 have repeatedly refused to end their abuse of the system through massive agricultural subsidies and barriers to exports of processed goods and textiles. Yet they are pushing developing countries to open up their markets. They are playing fast and loose with the multilateral trading system." - (Guardian Service)