7 Dec 2013

Historic global trade deal agreed

9:18 pm on 7 December 2013

The World Trade Organisation (WTO) has agreed on its first-ever global deal aimed at boosting commerce. Analysts say it could add $1 trillion to the global economy.

The agreement - reached in Bali after marathon negotiations between trade ministers from 159 nations - simplifies trade procedures and also makes it easier for the poorest countries to sell their goods by reducing export barriers and allowing such nations more scope to use subsidies to safeguard food supplies.

It is seen as an important step for the WTO, which has struggled to make new trade agreements since being founded in 1995, the BBC's economics correspondent reports.

"For the first time in our history, the WTO has truly delivered," says WTO chief Roberto Azevedo. "This time the entire membership came together. We have put the 'world' back in World Trade Organisation.".

One major sticking point had been India's insistence that it should be allowed to subsidise grain, under its new food security law. The United States and other members had said the programme broke WTO rules. An eventual compromise was found calling for a solution to the issue within four years.

Cuba had also threatened to veto the package, because it said it did not do enough to press the US to lift its trade embargo on the island; but it was eventually persuaded to accept the wording of the agreement.

US trade representative Michael Froman had urged the WTO's member economies to work past their differences.

"Leaving Bali this week without an agreement would deal a debilitating blow to the WTO as a forum for multilateral negotiations," Mr Froman said. "If that happens, the unfortunate truth is that the loss will be felt most heavily by those members who can least afford it."