WTO talks end in deadlock after Brazil blocks deal

World Trade Organization talks have ended in deadlock after Brazil blocked a bid by the US and other countries to extend a moratorium on customs duties for electronic transmissions, dealing a fresh blow to the embattled trade body.

WTO Director-General Ngozi Okonjo-Iweala said the e-commerce moratorium had expired, meaning countries could apply duties on electronic goods such as digital downloads and streaming.

But she said the WTO hoped to restore the moratorium and Brazil and the US were trying to reach an agreement.

"They need more time and we didn't have the time here," she said.

Expectations had been low going into the meeting, but failure to even agree to extend the e-commerce moratorium was a serious setback to the WTO, which has been struggling to remain relevant as countries increasingly work around it.

The marathon talks at the meeting in Cameroon made progress on drafting a plan for broader reform of the organisation, though agreements were still pending.

WTO talks would continue in Geneva, conference chair and Cameroon Trade Minister Luc Magloire Mbarga Atangana said.

They are expected to be in May, WTO officials said.

Britain's Business and Trade Secretary Peter Kyle said failure to reach a collective decision was "a major setback for global trade".

The talks were seen as a test for the WTO's relevance after a year of trade turmoil and major disruptions due to the Iran war.

But ministers could not agree to extend the moratorium by more than two years following objections from Brazil, diplomats said.

Diplomats had been working throughout Sunday to close the gap between Brazil, which had originally sought a two-year extension, and the US, which wanted a permanent one, by drafting a proposal for a four-year extension with a one-year sunset buffer, concluding in 2031.

Brazil later proposed a four-year extension, diplomats told Reuters, with a review clause halfway through, but that was not supported.

Developing countries have opposed a lengthy extension, arguing the moratorium denies them potential tax revenue they could invest back into their countries.

A US official said Brazil had opposed a "near-consensus document".

"It's not US versus Brazil. It's Brazil and Turkey versus 164 members," a US official said.

"The US wanted the sky," a Brazilian diplomat told Reuters, adding that Brazil wanted to remain prudent in extending the moratorium by only two years, as in previous ministerial conferences, given rapid changes in digital trade.

Another diplomat said US Trade Representative Jamieson Greer made delegates "uncomfortable" as he suggested there "would be consequences" if the US did not get a long-term extension to the moratorium.

Business leaders lamented the outcome of the talks, with International Chamber of Commerce Secretary General John Denton saying it was "particularly concerning at a time of real strain on the global economy".

John Bescec, Microsoft's director of customs and trade affairs, said business was expecting more certainty and predictability.

"Instead, we got the exact opposite," he said.

Getting a deal on the e-commerce moratorium was seen as key to securing support for the WTO from the US, which has retreated from global multilateral institutions under President Donald Trump.

The reform debate comes amid efforts to rework WTO rules to render subsidy use more transparent and make decision-making easier.

The US and European Union argue China in particular has taken advantage of current rules to their detriment.