Highly undiplomatic exchanges between the European Union and the United States over the vexed question of cotton subsidies have threatened to obstruct agreement at the already tough parallel talks on general agricultural liberalisation at the World Trade Organisation’s Hong Kong summit.

On day three of the meeting, Peter Mandelson, the EU’s trade commissioner accused the US of tying an offer to reduce cotton payments to Brussels “meeting their demands on agricultural market access”.

This, said Mandelson, “takes tactical negotiation to fresh heights”, adding “they are putting up a smokescreen to dodge commitments made (on cotton) in 2004”. The linkage threatens to complicate discussions on food liberalisation, because the cotton issue is highly emotive, with developing countries, led by west African governments, making it a key condition of striking an overall WTO Doha Development Round deal.