Lamy

WASHINGTON, United States (Reuters):

Prospects for a quick resumption of world trade talks appeared dim on Friday after World Trade Organisation director general Pascal Lamy warned that negotiations were on the brink of failure.

U.S. trade officials denied a report they had privately told trading partners they were prepared - if others made matching concessions - to offer US$5 billion more in farm programme cuts to get the talks going again.

U.S. Agriculture Secretary Mike Johanns also said differences in the world trade talks were so great he doubted Lamy could come up with a plan to bring parties together.

fundamental differences

"There's some pretty fundamental differences here," Johanns told reporters before meeting with Lamy.

"Just in agriculture, there's a big difference. I just think it would be very, very difficult for Lamy to put together a text to bridge that kind of gap," Johanns added.

Some trade experts believe only Lamy can break the impasse in world trade talks by putting together a draft plan that would become the blueprint for a final deal. One of Lamy's predecessors took a similar step in 1991, when the previous round of world trade talks were stuck.

Lamy, in an editorial on Friday in the Wall Street Journal, said the five-year-old round of world trade talks risked total failure after being suspended in July over differences in how far to cut farm subsidies and tariffs.

"There comes a time in every negotiation where the prospect of failure looms. For the Doha round of global trade negotiations, that time has nearly arrived," Lamy wrote.

He exhorted the United States to make further cuts in farm subsidies while pressing the European Union, Japan, Brazil and others to make concessions as well.

However, U.S. officials denied a report in BNA, a Washington-based news publisher, that the United States had privately told trading partners it was willing to reduce its previous proposal for a US$22.4 billion cap on overall U.S. trade-distorting domestic support down to US$17 billion.

"We have not signaled a readiness to reduce to US$17 billion or any other number," said Gretchen Hamel, a spokeswoman for the U.S. Trade Representative Susan Schwab.

At the same time, the United States has never said its previous offer was a "take it or leave it" proposal, Hamel said. "Negotiations were suspended, but talking was not. Ambassador Schwab continues to look for a way forward."

Schwab plans to press for progress in the negotiations at the annual Asia Pacific Economic Cooperation summit meeting later this month in Hanoi, Hamel said.

Johanns conceded the world trade "talks are on life support," but said the United States remained committed to the Doha round and restarting trade negotiations.

Lamy also met with Schwab, White House budget director Rob Portman and others while in Washington. Hamel declined to provide details of what Schwab and Lamy discussed.