The Cancun Ministerial Conference of the WTO is the Agricultural Ministerial. Never before has agriculture so dominated the trade talks. The negotiations on agriculture embodied all the classic WTO tensions between rich and poor countries, complicated by divisions among advanced countries themselves. At stake are tariffs and farm subsidies which the WTO trade round seeks to remove. The question is how? How fast? And by how much?

WTO Director General Supachai Panitchpakdi explained the purpose of the Cancun Ministerial: "Our meeting here in Cancun is not to conclude the Doha Development Agenda (the new round of trade negotiations). But we do need to leave in a few days time having created the climate and conditions under which the negotiations can conclude successfully by January 1, 2005."

He said the ministerial required ministers "to make key political decisions," and that "we cannot keep postponing decisions," reflecting the lack of progress before the conference was held.

If Cancun was about agriculture, then why did Hong Kong bother? One good reason is that under the current trading system, everything is related to everything else. Hong Kong's major trade interests is in reduction of industrial tariffs and liberalization of trade in services, but these cannot proceed if there is no progress in agriculture, as all of them come under the new round of WTO negotiations called the Doha Development Agenda.

Another reason to be in Cancun was that Hong Kong officially offered to host the next ministerial. No city would want to be hosting a failing trade round.

As Secretary General of the Hong Kong Coalition of Service Industries, I was interested primarily in the services negotiations. The Global Services Network, the private sector coalitions of service industries and similar bodies, took advantage of the ministerial to organize meetings and seminars to promote the WTO's General Agreement on Trade in Services. I also gave a briefing to some members of the GSN on the Mainland Hong Kong Closer Economic Partnership Arrangement (CEPA).

The ministerial was also the first for Mainland China to attend as a full delegation, led by Minister of Commerce Lu Fuyuan (when the Accession document was signed in Doha, China was still an observer.) The Chinese delegation clearly meant business, and actively contributed to the negotiations.

As with all previous ministerials, the officials were joined by a wide range of non-governmental representatives, many of whom are expressly anti-globalisation and anti-WTO in nature. There were some demonstration but barring one or two incidents, these were all peacefully conducted.

The head of Hong Kong's trade delegation was Financial Secretary Henry Tang, who was appointed by the Ministerial Conference as a "Friend of the Chair" to be in charge of the negotiations on industrial tariffs, otherwise called "non-agricultural market access," or NAMA.

The "Friends of the Chair" were to guide the negotiations on five contentious subjects, including -- besides agriculture and NAMA -- development issues, wine and spirits, and "Singapore Issues." The latter refers to four subjects that were brought forward from the Singapore Ministerial, namely, trade and competition policy, trade and investment, transparency in government procurement, and trade facilitation. Later, another group was added to address specifically issues related to cotton trade and subsidies.

The aim of the conference was to produce a declaration to guide the Doha Development Agenda to its conclusion before January 1, 2005. A draft declaration, widely acknowledged to be full of holes, had been prepared well before the Cancun meeting to start off the process.

Most of the negotiating time was spent on agriculture. The main contention centred around the "framework of modalities" (i.e. an agreed methodology) to be established to enable WTO members to negotiate cuts in agricultural tariffs and export subsidies. After three full days of talks, by Saturday morning (September 13) a revised draft was produced, which switched the negotiations into a higher gear.

Twenty-four hours later (Sunday morning), despite much rhetoric, a deal on agriculture was beginning to emerge. Many were beginning to bet on a successful end to the conference. However, things took a different turn as attention shifted to the "Singapore Issues." Developing countries did not want to launch negotiations on these issues advocated by countries like the EU and Japan.

Though a contentious problem, the Singapore Issues should not have been in the same league as agriculture. In the previous Ministerial in Doha, a similar stalemate was reached, but it was broken by an additional day of negotiations. Many people expected that the Cancun talks would be similarly salvaged by "stopping the clock" for 24 hours, but to their surprise, the WTO negotiators declared on the same day (Sunday afternoon) that the division was so big that agreement was not possible. The conference thus ended without adopting the draft declaration, and only a brief six-paragraph statement was issued.

In a nutshell, they beat the most difficult issue (agriculture) but the Cancun talks died of a side-effect (the Singapore Issues).

This is not to say the Doha round is completely lost. Mr Supachai will see Cancun as another occasion for decisions to be postponed, and he has set December 15 as the new deadline for another effort to be made to rescue the Doha talks.

As to Hong Kong hosting the next Ministerial Conference, the offer is still on the table. The present score is that out of five ministerials, two have failed (Seattle and Cancun). Both Hong Kong and the WTO will hope that the next one will be a resounding success.