Africa, Development & Aid, Economy & Trade, Food and Agriculture, Global, Global Geopolitics, Headlines, Poverty & SDGs, Trade & Investment, Trade and poverty: Facts beyond theory

TRADE-AFRICA: Liberalisation Eroding Poor Countries’ Advantage

Stephanie Nieuwoudt

CAPE TOWN, Mar 17 2008 (IPS) - The trade liberalisation of the past couple of decades is eroding the advantage that least developed countries (LDCs) enjoy in export markets as duty and quota free access has become less valuable.

This is according to Trudi Hartzenberg, executive director of the non-governmental Trade Law Centre for Southern Africa (Tralac) based in South Africa.

‘‘The fact is that significant tariff liberalization has already occurred in the last couple of decades – both in the World Trade Organisation and in the negotiations to establish free trade areas. With such liberalisation the value of even duty-free quota free market access declines. The advantage that LDCs enjoy in export markets is thus continuously being eroded,’’ Hartzenberg told IPS.

&#39&#39Under these circumstances other factors such as technical standards and sanitary and phytosanitary standards become more important. LDCs face real challenges in meeting these standards. They don&#39t have the capacity to meet the standards or to certify that they have met the standards in many cases.

‘‘These are some of the supply-side issues that constitute the real barriers to market access in a liberalised trade environment. Supporting LDCs to develop this capacity can make a big difference to assist them to take advantage of duty free, quota free market access,’’ Hartzenberg added.

Her comments come after a conference of LDC trade ministers held in Maseru, Lesotho, two weeks ago.


Hartzenberg said that the value of the Maseru meeting will be seen as the Doha Round talks at the World Trade Organisation (WTO) continued. ‘‘Several influential figures such as European Union trade commissioner Peter Mandelson and Pascal Lamy, director general of the WTO, participated in this meeting.

‘‘Pledges are always made to assist LDCs. It may well be important to follow up to secure assistance, for example to meet the demanding standards set by the European Union and other trading partners. In many respects though, nothing new may be said, but the profile of LDC concerns may be raised in certain respects, and this is important," she stressed.

Lamy in his address at the meeting said that ‘‘LDC-specific priorities are now well known to everybody’’, adding that they will have to promote their issues vigorously at the Doha negotiations.

Mark Pearson, programme director of the Regional Trade Facilitation Programme (RTFP), saw a few positive signs in the discussions at the meeting. There was further commitment to get the duty free, quota free and rules of origin provisions implemented. The RTFP was initiated by the UK’s department for international development.

Lamy has said that LDCs will benefit from duty-free, quota-free treatment on 97 percent of their exports. Rich countries will eliminate their cotton export subsidies and reduce other forms of trade distorting support. Cotton exports from LDCs will receive duty-free, quota-fee treatment.

The duty and quota free issue is important as WTO members in 2005 removed all tariff and quotas on 97 percent of imports from LDCs.

While the remaining three percent seems negligible, analysts point out that LDCs produce and export very little. The goods that they do export are vulnerable commodities like clothing, textiles and leather which meet with strong competition from countries like China. These products are often not included in the 97 percent.

At the meeting, the LDCs asked developed countries to identify the remaining three percent in their draft commitment schedules.

Pearson told IPS that the ministerial declaration adopted at the meeting re-affirmed the importance of allowing LDCs special treatment in the area of services as well as focusing on LDCs’ ability to improve competitiveness.

‘‘The importance of maintaining long-standing preferences to LDCs in their attempts to use trade as a development tool was also highlighted,’’ Pearson said.

At the meeting the ministers warned that sector-specific liberalisation initiatives in the industrial goods negotiations at the WTO risked eliminating the margin of preference that LDC exports are receiving.

Should tariffs on fish and fish products be eliminated at the non-agricultural market access (NAMA) talks, as the industrial goods negotiations are known as, it could be devastating for LDCs which are dependent on fisheries.

The LDC ministerial meeting took place at a time when there were serious doubts whether the Doha rounds would be concluded successfully. But on March 13 the WTO issued a statement that nations have agreed on the mechanics of how to seal a deal in the Doha Round. Ministers are reportedly now clear on what is required for a successful conclusion of the talks.

Since the Doha Round started, there have been regular ministerial meetings in different regions where trade ministers talk about their expectations and how to take the talks further. The February meeting was the first LDC ministerial in nearly three years.

 
Republish | | Print |


born darkly epub