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TRADE: WTO Blocs Displeased with Draft Plan for Farm Talks

Gustavo Capdevila

GENEVA, Feb 13 2003 (IPS) - The draft of proposals for the prickly negotiations on agriculture at the World Trade Organisation (WTO) has brought contrary reactions, although nearly all parties admit that the document could put the talks back on track.

The leaders in international farm trade – European Union, United States and the anti-subsidy countries of the Cairns Group – voiced their divergent objections to the proposed modalities for the talks presented by the chairman of the WTO agricultural negotiations committee, Stuart Harbinson.

Most delegations from developing countries put off commentaries about the text, but the non-governmental groups that tend to support the position of that bloc say Harbinson’s proposals will have a negative effect on what has been dubbed the Doha Round of multilateral trade talks.

Celine Charveriat, the Geneva representative of Oxfam International, the Britain-based humanitarian organisation, says the draft of proposals would be a "litmus test for the credibility of the WTO."

But she added, "If accepted, these proposals could spell the death of the so-called Development Round," the name the wealthy countries insist on for the negotiations launched by the WTO ministerial conference in late 2001 in the Qatar capital.

The range of reactions to Harbinson’s report reflects the weight that the WTO members give the talks on farm trade, the sector lagging farthest behind in the liberalisation process of the international economy.

Also brought to light are the divergence of interests setting the highly subsidised farm sectors of the European Union, United States, Japan and most industrialised nations, apart from the bloc of poor countries, where farming is practically the only source of employment and sustenance.

The Cairns Group is in a league of its own. It advocates the low or non-existent subsidies for farm production and exports as practiced by its membership: Argentina, Australia, Bolivia, Brazil, Chile, Canada, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Paraguay, Philippines, South Africa, Thailand and Uruguay.

In contrast, the industrialised nations of the Organisation for Economic Cooperation and Development (OECD) together spend a billion dollars a day to shore up their competitiveness in farm exports and sustain their agricultural sectors.

Crisis-stricken Argentina, a Cairns Group member, has gone to the other extreme. Last year it introduced a tax on agricultural exports, known as "retentions", as a means to collect revenue to pay off foreign debt and deal with fiscal imbalances.

Such contrary and vehemently held positions will make Harbinson’s a sensitive and difficult task, commented Argentina’s chief negotiator, Alfredo Chiaradia.

But Harbinson’s mission is set in the declaration signed by the WTO ministers in Doha, which calls for reforms to reduce and ultimately eliminate obstacles for farm imports, and also takes aim against export subsidies and domestic support for farmers.

The text that the negotiations chairman presented incorporates these ideas, but at levels that have left nearly all parties to the talks dissatisfied.

The EU complained that most of the changes would harm farm trade for industrialised countries.

The European bloc criticised the fact that Harbinson’s proposals make no mention of non-trade, farm-related concerns, such as rural social development, environmental protection and food security. The EU has used such arguments to prolong its protectionist policies.

The Doha Declaration did not give those issues high priority, as is reflected in the Harbinson text.

The United States, meanwhile, demanded tougher action against tariffs and subsidies, the two protectionist tools most used by the EU, Japan, Norway, South Korea and Switzerland.

Commentaries coming from the Cairns Group included criticism that the chairman’s proposals are not ambitious enough. New Zealand’s trade minister Jim Sutton says export subsidies should be eliminated immediately.

Oxfam’s Chiaradia noted that Harbinson’s report, in reference to access to markets, includes the possibility of allowing exceptions for certain strategic products, with smaller tariff reductions.

Each country would be able to designate which "sensitive products" could be given smaller reductions, she explained. The EU would likely list dairy products, meats, and temperate-climate grains.

The Thailand-based NGO, Focus on the Global South, took a dim view of Harbinson’s draft text, asserting that "the negotiation modalities put forward in the paper are a sham. They are intended to give a green light to transnational agri-business to take over developing countries’ agriculture markets."

The stance of Focus on the Global South, explained the group’s Geneva representative Aileen Kwa, is that the document ignores the proposals of developing countries that seek to protect their farmers against dumping (a disloyal trade practice) and to address the problems of rural unemployment and food insecurity.