World Trade Organisation talks in Cancun, Mexico have collapsed after rich and poor countries failed to agree on key agricultural reform issues.

After five days of arguments over farm reform, the talks finally caved in when poor countries refused to discuss proposed new rules aimed at cutting red tape and corruption to facilitate trade, reported Reuters.

The EU and US both admitted that the failure of the talks meant that it would be difficult to meet the WTO’s deadline for a comprehensive reform of world trade by the end of 2004.

“It is hard for me to believe, in the position we are now, that we will be able to finish on time,” US Trade Representative Robert Zoellick said. 

Some poorer nations, meanwhile, saw the collapse of the talks as a show of strength by developing counties, proving that they would not be forced into a deal by the EU and US.

“We have always alerted people that unless they listen to the developing countries … this is what will happen,” Malaysia’s trade minister, Rafidah Aziz, was quoted by Reuters as saying.

Others, however, saw the breakdown as another delay, hampering progress on the issue of agricultural subsidies.

“It’s very sad to see this collapse, but I think we developing countries need to work harder to gain more power for future negotiations,” said Vichai Sriprasert, president of the Rice Exporters Association of Thailand.  “We can only hope that they will listen to us.” 

Manuel Lamata, president of the United Federation of Sugar Producers in the Philippines, said developing countries were unable to compete against subsidised developed countries. 

“It is about time the first world countries realise they cannot just step on the poor countries,” he said. 

On the issue of farm reform, Zoellick said the talks had collapsed because some poor countries had demanded concessions from the EU and US without offering anything in return.

“A number of countries just thought it was a freebie…Now, they’re going to have to face the cold reality of that strategy and come home with nothing,” Zoellick said. 

Trade officials said they would meet in Geneva to discuss whether or not the talks can be revived.