Agricultural protection is the deal-breaker for the World Trade Organisation and if progress is not made, could lead to a breakdown in other trade talks, Prime Minister John Howard says, reports Asia Pulse.

Speaking after the two-day Asia-Pacific Economic Co-operation (APEC) leaders’ summit, Howard said it was remarkable that member countries had signed up to a statement of principle that progress needed to be made on agricultural protection.

“Agricultural trade is the deal-breaker for the WTO,” he said. “If we don’t get progress on that, we’re not going to get progress on other fronts.

Mr Howard told ABC radio that for the first time in years, a generous offer of tariff reductions had come from the United States.

The US has proposed that developed countries cut their farm tariffs by between 55% and 90%, while an EU counter-offer would limit tariff cuts to less than 40%, with the top tariff set at 100%.

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The EU also wants up to 176 tariff lines on so-called sensitive products excluded from the overall cuts.

“Even America’s fiercest critics on trade would have to acknowledge that the American offer goes a long way, and reciprocity from the European Union is clearly now needed,” Mr Howard said.

He said Japan’s signing of the statement of principle was very significant.

“Japan, as you know, has quite high levels of agricultural protection,” he said.

“Japan is a very valuable trading partner of Australia’s, and I want to put that on the record again and again, but there is no doubt we would like to see lower agricultural trade barriers in Japan, and the fact that Japan has signed up to this declaration of principle is very significant, and all the roads, in a sense, now are all signposted in the direction of Brussels.”