Development at Stake

This column was distributed internationally by the Inter Press Service, Columnist Service, July 2004. http://ipsnews.net/weekly.asp?Dir=Next

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Current trade talks in Geneva aimed at reviving negotiations on lowering
global trade barriers, which have floundered since the collapse of the
fifth ministerial in Cancun, are a reminder of the crisis of inequity and
hypocrisy within the WTO, which have afflicted the organization from the
very beginning.

The text put before the 147 members on July 16 endorses the reprehensible
treatment of development issues in the WTO. For example, the draft
callously disregards the concerns of the developing countries in the field
of agriculture. Agriculture being an area where developing countries might
compete head-on with the industrialized nations - the draft asymmetrically
panders to the interests of the politically influential corporate
agriculture in rich countries like the U.S. at the expense of millions of
poor farmers across the Third World. It enables rich countries to protect
their markets in 'sensitive' products from import competition from
developing countries while encouraging export dumping at artificially low
prices by proposing a framework for new blue box subsidies to accommodate
its richest members.

In addition, the draft openly discriminates by adopting a non-committal
approach to the Special and Differential treatment needs, sensitive
products and special safe guard mechanisms and leaves them for a "post
framework stage." At the same time, the draft overlooks the demand of
African countries for the Cotton Initiative to be treated on a stand-alone
and fast-track basis, and instead, adopts the U.S. demand to consider this
issue under the broader agriculture negotiations.

Using its powerful influence on the World Bank, IMF, and international
trade agreements, the U.S. has already pressured poor countries into
removing subsidies that favor local producers, and lowering tariff charges
on foreign imports. With its own subsidies intact, the U.S. dumps cheap
subsidized food into developing nations, ravaging the livelihoods of small
farmers. The numbers are alarming: For example, the U.S. exports corn at
prices 20 percent below the cost of production, and wheat at 46 percent
below cost. The result is that the U.S. farm subsidies cost poor countries
about $50 billion a year in lost agricultural exports - that's the same as
total of rich countries aid to poor countries.

The draft fails on several other accounts. It does not mention the Doha
mandated review of TRIPS to prevent monopolies in agriculture and
pharmaceuticals. TRIPS have denied farmers and citizens access to
affordable seeds and medicine, and promoted piracy of biodiversity and
indigenous knowledge. In other areas such as Non Agriculture Market Access
(NAMA) issues, it reproduces the same text that was rejected by the
developing countries in Cancun on grounds that it would deepen their
crisis of deindustrialization and unemployment. In services, the text
advocates for swiftly moving forward with market access negotiations
instead of respecting the right of developing countries to regulate trade
in services.

Supachai Panitchpakdi, WTO director-general is keen to have country
members reach agreement on the broad principles for cutting subsidies and
import tariffs by July 31, ahead of the U.S. presidential election and
changes in the European Commission, that will put trade negotiations on
hold for months. With the rejection of the draft by the Indonesian
government which represents the G33, and growing discontent among other
member countries, the General Council Chair Ambassador Oshima has
announced that the formal meeting of the General Council would be
suspended on July 27 before the agenda item on the July package is
discussed, ensuring most of the negotiations will take place in an
"informal mode." Whenever Third World governments have balked at U.S. and
EU dictated WTO proposals, they have been shown into a darkened room where
they are bludgeoned with threats to cut off preferential market access,
suspend aid, or otherwise have their arms twisted.

However this tactic does not work as already proven in Cancun. The crisis
of Cancun has been deepened by the double standards of the WTO. The truth
is that the draft July package pulls a reverse Robin Hood: robbing the
world's poor to enrich American and European corporations and will remain
deadlocked as it continues to fail the development needs of the poor.

* Anuradha Mittal is the founder and director of the Oakland Institute, a
non partisan research, analysis and advocacy group.