Latest update May 10th, 2024 12:59 AM
Jul 31, 2008 Editorial
After nine days of wrangling over the farmers’ protection issue, the World Trade Organisation (WTO) talks in Geneva have “collapsed”.
The specific issue supposedly concerned a “special safeguard” that developing countries such as China and India demanded to deal with sudden surges of imports or drops in prices. The developed countries opposed this proposal.
The special safeguard, however, may be the occasion for the collapse of the round but not its cause. For the latter, we need to examine the context in which the Doha Declaration was adopted.
Launched in November 2001, the Doha round of multilateral trade negotiations represented an ambitious attempt to use trade as an instrument of development: hence the term, “development round”.
The round, which initially was supposed to conclude by the end of 2004, had dragged on primarily because of the intransigence of the developed countries.
The previous nine rounds had all studiously excluded any meaningful discussions on agriculture – the bedrock of the underdeveloped world.
The developed world, in the meantime, had instituted intricate systems that doled out incredible amounts of subsidies to their farmers, which then placed farmers in developing countries at a severe disadvantage.
The major contentious issues, not surprisingly, involved reforms in agriculture, in trade, linking trade and labour standards (particularly those related to child labour), and finalisation of a Multilateral Agreement on Investment.
We can understand the welter of legislation enacted in our own country in these areas in the last decade. It was also during the 1999 Seattle Ministerial Conference that the growing influence of developing countries on the multilateral forum was felt –especially Brazil, Russia, India and China, the so-called BRIC countries.
Developed countries came to realise that unlike in the past, developing countries, particularly these bigger ones, could no longer be taken for a ride. Multilateralism was acquiring some teeth.
The Doha Declaration represented a compromise between the positions of developed and developing countries.
The former agreed to liberalisation of trade in agriculture and to address special needs of the latter in Non-Agricultural Market Access (NAMA) and trade-in services, but did not define the modalities of the reforms and the timeframe within which the same were to be carried out.
In short, whatever commitment developed countries made, was couched in vague, non-committal terms. It was still an uneven street.
The Doha Declaration provided for negotiations aimed at substantial improvements in three areas related to trade in agriculture: market access, export subsidies and trade-distorting domestic support.
However, it was felt that the offers of reductions of tariffs by the developed countries were merely symbolic, in light of the vast reductions that had already been instituted, and so were not reciprocal to the sacrifices demanded of the developing countries.
At Geneva, the major protagonists were India and the US. India directed several alliances of developing countries such as G-20, G-33 and NAMA to ensure that the “development dimensions” of the Doha Round were safeguarded.
On the other hand, the US, the European Union and other developed countries mounted pressure on the ‘large and developing economies’ like India, China, Brazil and South Africa to throw open their markets globally for both agricultural and industrial goods. India and China’s refusal to blink will redound to the developed world’s benefit very shortly.
There have now been three collapses of WTO talks at the Ministerial level in as many years so there are all expectations that the talks will be resuscitated.
However, in the meantime the developed nations will focus in cutting bilateral deals with the weaker individual or regional blocs of nations.
One analyst pointed out that in the EU-ACP arena here, the former is bent on imposing EPAs on the latter. “In the 2000s, the exports of food and agriculture from the European Union countries to their traditional trade partners in Africa, the Caribbean and the Pacific (ACP) have increased by almost 40 per cent; but exports of the same goods from the ACP countries to the EU have actually fallen in the same period.”
The alternative of the multilateralism of the WTO is the bilateralism of the EU-drafted EPA: it was a case of the old fashioned tale of the shark and the sardines.
As a country, and as a region, we need to assist in getting the Doha round back on track for the sake of our own survival. We need some big friends.
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