Brazil and India Offer Trade Concessions to Industrial Nations Amid Global Trade Talks

The Group of 7 of the world's leading industrialized nations called for "renewed momentum" in international trade liberalization on Saturday, as Brazil and India made a surprise offer of trade concessions to challenge the rich nations to find a solution. The offer, which involves opening their markets further to industrial goods and services, is conditional on the United States and the European Union further dismantling protection of their agricultural markets.

Key Takeaways:

• Brazil and India have made a surprise offer of trade concessions to the world's leading industrial nations, conditional on the US and EU dismantling protection of their agricultural markets.
• The offer involves opening their markets further to industrial goods and services, but only if the US and EU reduce their agricultural subsidies.
• The Group of 7 finance ministers welcomed the Brazilian and Indian offers, but the US gave no indication of how it would respond.
• EU nations are divided on the issue, with Britain speaking out in favor of new cuts in Europe's farm support, while France denied any change in the EU's position.
• Gordon Brown, the British chancellor of the Exchequer, said success in the trade talks could increase global income by $300 billion over the next 10 years.
• The G-7 finance ministers warned that trade protectionism was a risk to world growth and called on China to make its exchange rate system more flexible.
• The offer exposed fresh divisions among European countries, with Britain and France holding different positions on agricultural subsidies.
• The meeting was part of efforts to restart trade talks and break a stalemate in the World Trade Organization talks, which are scheduled to begin on December 13 in Hong Kong.

Statistics:

• The trade talks could increase global income by $300 billion over the next 10 years.
• The EU's agricultural subsidies are a key point of contention in the trade talks.