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WTO-SPECIAL: Lack of Size Matters
By Sanjay Suri
LONDON, Dec 3 (IPS) - Small island states have learnt to fear more than a
tsunami. They are preparing themselves for being swamped by a tidal wave
of devastating imports if world trade ministers cannot come to an
agreement that protects their interests.
Small can be really small. Not all are quite like Tuvalu, with a
population of 11,000 or so. You have a relatively large nation by way of
Maldives with a population of about 350,000. And there are many more such
giants relative to tiny Tuvalu, with a population running into a few
hundred thousand.
They are a few people, but in quite a few countries, though. And they
fear they will be forgotten when the world talks trade agreements, and
that agreements once made will swamp them, and no one else in the world
will notice.
The fears of small states hit the headlines after the tsunami at the end
of December last year. Those concerns that these island countries could
be simply swamped by the sea dominated an international meeting on small
island states held in Mauritius early this year.
That meeting had sought to take forward the 1994 Barbados programme of
action for the sustainable development of small island developing states
(SIDS). No one seemed to have taken much notice of the Barbados agreement
until the tsunami came along.
''My country is like a can of tuna fish,'' Maldivian foreign minister
Fathulla Jameel had said, ''because it comes with an expiry date.'' Now
that fears of another tsunami have receded, countries like the Maldives
are beginning to fear cans of fish packed in Western countries sold
cheaper than production costs in developing countries because of both
domestic production subsidies and export subsidies offered by rich
governments.
Few of these small countries have an effective voice at the Commonwealth,
and many are not sending any representatives there at all. The
Commonwealth, a grouping of 53 countries that were once a part of the
British Empire, is now stepping up to speak for them at the trade
ministers meeting in Hong Kong later this month.
''The Commonwealth will not be at the table at the WTO (World Trade
Organisation) meeting,'' Winston Cox from the Commonwealth told
IPS. ''But we will provide assistance and expertise for member countries
so that they are not at a disadvantage at the table.''
Cox will be particularly well placed to strengthen the case of small
island states. He is deputy secretary-general in charge of WTO issues at
the Commonwealth, he is from Barbados, a small island state with a
population of 280,000, and he was formerly director at the World Bank.
''A major concern is going to be to ensure special and differential
treatment for small and vulnerable countries,'' he said. ''They will be
looking for better market access, looking for recognition that their size
of the international trade is so small that they cannot have any
distorting effect on world trade at all.''
The small states, and those representing them, will seek to make sure, he
said, that ''they are not pushed into actions that will destroy their
economies.''
Many of these countries have just one commodity to sell, and when that is
hit, the national economy faces ruin. Such dangers have emerged starkly
with the new risks to banana and sugar exports from many of these
countries.
''The economy of Dominica (pop. 69,000) has been devastated because of
the challenge to the EU (European Union) banana policy,'' Cox said. An EU
decision to reduce preferential access to bananas from African, Caribbean
and Pacific (ACP) nations following a WTO ruling has hit many of these
countries hard.
''Many countries exporting sugar to the EU will see a decline in the
price of the sugar they export as a result of reforms of the EU sugar
policy,'' Cox said. ''EU farmers are getting a completely different level
of compensation through these reforms than the farmers in these small
countries.''
Many of these countries face threats to services too.
The Commonwealth is looking to support financial services offered by
small countries like St. Kitts and Nevis (pop. 39,000). The Organisation
for Economic Cooperation and Development (OECD), a grouping of 30 rich
countries, has been pushing for a crackdown on services offered by many
of these countries, which it considers tax havens and centres for money
laundering.
''These countries would like to be able to provide services to the rest
of the world,'' Cox said. ''Most of these economies have entered into
double taxation treaties with other jurisdictions, which legitimises tax
behaviour between two countries.''
Among the less noticed campaigns at Hong Kong this month will be the one
that seeks to show that lack of size matters.
(END/2005)
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