WTO agreement in Geneva
The World Trade Organization (WTO) members approved a plan on Aug 1st to end export subsidies on farm products and cut import duties around the world. The consensus among the 147 nations veils the intense dispute that broke down the negociations in Cancun, Mexico in September of 2003.
Cancun was held to complete the Doha round (2001) and concentrated on four main areas - agriculture, industrial goods, trade in services, and a new customs code. Developing nations formed a alliance and refused to sign a proposed agreement which they felt favored the rich nations, particularly on agriculture.
Take the case of cotton. The livelihood of some 10 million West African is dependent upon cotton farming. Benin, Burkina Faso, Mali and Chad produce cheap, high-quality cotton, often using traditional methods, but are unable to compete against subsidized competition from the mighty United States. American cotton producers receive USD$3,9 bn in subsidies from Washington each year.
In Geneva, the US, the EU, Brazil, and Japan agreed to eliminate export subsidies at a date to be set, to limit other subsidies, and to lower tariff barriers. The plan includes a "down payment" that would see an immediate 20% cut in the maximum permitted payments by rich nations. Developing countries also won the right to protect "special" products crucial to the well-being of their economies. In return, wealthier nations won better access to markets in developing nations, particularly for industrial goods.
Some major NGOs downplay the agreement. The development aid charity Oxfam International pointed out the agreement has no timeline, and so African nations are dependent on the good will of the USA. Celine Charveriat, Head of Oxfam Internationals Geneva office said: "Presented as a breakthrough, the text on agriculture does little to address the problem of export dumping, instead introducing dangerous loopholes for yet more subsidies especially from the US. (...) After days of closed door negotiations, rich countries have delivered a deeply unbalanced text as a take or leave it option. This puts developing countries in the unfair position of having to accept a bad deal or reject and get blamed by the US and EU for failure."
Despite having right on their side, constituting the majority and forming a coordinated block, developing countries have less pull in negotiations. "We don't really have a choice. African countries come under a lot of pressure both from industrialized countries and their own governments not to jeopardize food aid or bilateral agreements," said one African Union representative, on condition of anonymity, quoted in www.iol.co.za.
This deal opens the way for full negotiations to start in September. The next WTO ministerial meeting will be December 2005, in Hong Kong.
Cancun was held to complete the Doha round (2001) and concentrated on four main areas - agriculture, industrial goods, trade in services, and a new customs code. Developing nations formed a alliance and refused to sign a proposed agreement which they felt favored the rich nations, particularly on agriculture.
Take the case of cotton. The livelihood of some 10 million West African is dependent upon cotton farming. Benin, Burkina Faso, Mali and Chad produce cheap, high-quality cotton, often using traditional methods, but are unable to compete against subsidized competition from the mighty United States. American cotton producers receive USD$3,9 bn in subsidies from Washington each year.
In Geneva, the US, the EU, Brazil, and Japan agreed to eliminate export subsidies at a date to be set, to limit other subsidies, and to lower tariff barriers. The plan includes a "down payment" that would see an immediate 20% cut in the maximum permitted payments by rich nations. Developing countries also won the right to protect "special" products crucial to the well-being of their economies. In return, wealthier nations won better access to markets in developing nations, particularly for industrial goods.
Some major NGOs downplay the agreement. The development aid charity Oxfam International pointed out the agreement has no timeline, and so African nations are dependent on the good will of the USA. Celine Charveriat, Head of Oxfam Internationals Geneva office said: "Presented as a breakthrough, the text on agriculture does little to address the problem of export dumping, instead introducing dangerous loopholes for yet more subsidies especially from the US. (...) After days of closed door negotiations, rich countries have delivered a deeply unbalanced text as a take or leave it option. This puts developing countries in the unfair position of having to accept a bad deal or reject and get blamed by the US and EU for failure."
Despite having right on their side, constituting the majority and forming a coordinated block, developing countries have less pull in negotiations. "We don't really have a choice. African countries come under a lot of pressure both from industrialized countries and their own governments not to jeopardize food aid or bilateral agreements," said one African Union representative, on condition of anonymity, quoted in www.iol.co.za.
This deal opens the way for full negotiations to start in September. The next WTO ministerial meeting will be December 2005, in Hong Kong.
posted by André Levy @ 12:22 PM
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