WTO in 'crisis' after talks fail, Lamy says

"I will not beat about the bush," Mr Lamy said after the meeting in a statement. "We are now in a crisis."

He stated that the 149 WTO members now seemed to be faced with the real propsect of a Doha development round not taking place.

"This is serious, not only for the agriculture and industrial tariffs, but also obviously for the round as a whole if we want to conclude it by the end of this year," he said.

Mr Lamy also explained that in the next few weeks he would bilaterally establish intensive diplomatic contacts in search of an agreement.

"The gaps are not unbridgeable and there is no panic," the Frenchman said.

EU trade commissioner Peter Mandelson, who deals with WTO negotiations on behalf of the European Union agreed on the problematic outlook.

"If we don't turn things around in the next two weeks, we will not make a breakthrough this summer and then we will be facing defeat," he said according to the BBC.

The almost five year old Doha round of WTO talks, which started in the capital of Qatar in 2001, has already missed several deadlines and was meant to end in 2004.

A ministerial meeting in December last year failed to reach an agreement but set a deadline for a deal in April which was then postponed to this weekend in Geneva.

US trade representative Susan Schwab said the impasse "does not mean that the Doha is dead."

The Indian minister of industry, Kamal Nath, who is one of most outspoken critics of the richer countries and who returned to India without waiting for the final outcome of the meeting said, according to La Vanguardia, that "there was no necessity" to hide that the meeting of Geneva "has been a failure."

Australian prime minister John Howard today blamed the EU for the near collapse of the trade talks, saying it was European intransigence on agricultural protection that was putting the negotiations at risk.

The Doha round aims to boost the global economy and help pull millions of people across the world out of poverty by liberalising trade in agriculture, industry and services.

To save the deal, according to Mr Lamy, the US must reduce the subsidies Washington pays to its farmers, while the EU must lower the duties on agriculture imports and the G-20 group of developing countries, led by Brazil and India, must open up access to its industrial markets.