Development & Aid, Economy & Trade, Global, Global Geopolitics, Headlines

WTO-CANCUN: South Seeks Life Buoy for Farm Trade Talks

Gustavo Capdevila

GENEVA, Aug 19 2003 (IPS) - A group of developing countries is discussing an initiative that could be the last chance for averting failure of agricultural trade negotiations at the WTO ministerial conference next month in the Mexican resort city of Cancun.

Trade officials from Argentina, Brazil, China, India and Kenya are working in Geneva on a document that aims to consolidate the issues of critical interest to the developing South.

The text is to be presented Wednesday, said Brazilian representative Luiz Felipe de Seixas Correa, so that the delegation chiefs can discuss it in the afternoon session of the preparatory meetings for the Cancun conference.

The group of developing countries – which includes the powerhouses of the developing world – are drawing up what is considered a counter-proposal to what the world’s farm trade powers, the United States and European Union, presented last week.

Coexisting in the group are countries that are on the offensive for liberalising agricultural trade (Argentina and Brazil), and others that have taken a defensive stance to protect their large peasant farming sectors, as is the case of India and Kenya, noted Argentine trade representative Alfredo Chiaradía.

The authors of the initiative propose to put the pressure on the EU and United States so that they reconcile themselves to negotiating at the WTO (World Trade Organisation) a reduction of their export subsidies and domestic supports for farmers, two areas that both trade powers defend with what critics say are weak arguments.

The counter-proposal reportedly puts less emphasis on a reform of the EU and U.S. policies on controlling access of agricultural products to their markets.

In an assessment of the EU-U.S. farm trade proposal presented last week, India representative Kesava Chandrasekhar noted that the text is cautious on the matter of domestic supports, but is ambitious with regard to market access.

As far as export subsidies, Chandrasekhar commented that the mandate of the last ministerial conference, held in 2001 in Doha, Qatar, is clear that this trade distorting practice must be eliminated.

Any text for an agreement need not repeat that mandate, as does the EU-U.S. proposal, because the negotiations should be limited to the matter of the timeframe for removing export subsidies, stressed India’s representative.

At the same time, the proposal by Argentina, Brazil, China, India and Kenya would harmonise the developing world’s interests through the adoption of the concept of "special and differentiated treatment" for poor countries and the authorisation to apply protections in the cases of products considered strategic for their economies.

The discussions of the group of developing countries, headed by Brazil, have been underway since the weekend, involving officials in their capitals and their missions in Geneva.

The document comes at a point in WTO negotiations on farm trade have become bogged down, threatening the entire Doha Round, which also encompasses matters related to industrial tariffs, services, intellectual property, public health, and other issues of particular interest to the developing world.

The Doha mandate established the basic elements for the entire Round of negotiations, and that the WTO members states, which now number 146, were to approve by lasts Mar. 31 the "modalities" for the farm trade talks slated to conclude by the end of 2004.

But as has occurred in many other areas of the Doha Round, the deadlines came and went without the parties finalising agreements.

In the case of the agricultural talks, it was believed that the deadline would force an agreement on the modalities before the ministerial conference Sep. 10-14 in Cancun.

But this week the possibility emerged that the modalities – the definition of the specific characteristics that the agricultural agreement will have – would not even be approved in CCancun.

Dissatisfaction with the EU-U.S. initiative has led the delegations from many countries to say it would be more appropriate for the ministers to merely approve a "framework" document on modalities at the Cancun conference.

The framework agreement would define the key aspects for reform of the WTO Agreement on Agriculture, as the decision adopted by the trade ministers in Doha did.

The framework idea was proposed Monday by Stuart Harbinson, of Hong Kong, chairman of the WTO Committee on Agriculture, who consulted numerous delegations at the behest of the WTO General Council chairman, Carlos Pérez del Castillo, of Uruguay, who is presiding over the Doha Round.

Harbinson said the framework text should be "faithful to the Doha mandate," include the key concerns of the member states, and "constitute a clear step forward in the negotiations."

The stagnation of the farm trade talks has tied the hands of the groups negotiating the other points on the Doha Round agenda because most of the WTO members are making progress in agriculture a condition for negotiating other areas.

Argentine negotiator Chiaradía reckons there has been little if any progress on the non-farm issues, although, "They keep talking," he said.

But in some areas there has been backsliding, he added, such as in market access for no-agricultural products, where negotiations are underway to reduce tariffs for industrial goods.

Those talks seemed to be advancing at a faster pace than the rest, but they suffered a reversal after the EU, United States and Canada presented their joint initiative, commented Chiaradía.

The counter-proposal for agricultural trade appears to have created tensions amongst countries that are otherwise on the same team.

Argentina and Brazil’s partners in Mercosur (Southern Common Market), Paraguay and Uruguay support the text, but it would imply a distancing from the Cairns Group, a bloc of countries that rely heavily on farm exports and are opposed to protectionist measures.

Cairns Group coordinator, David Spencer, trade representative from Australia, declined to make specific comments on the matter when consulted by IPS. "We will be considering it overnight. We’ve been informed what’s going on. But we are not in a position to say anything."

The two-week process of prior negotiations for the Cancun conference is nearing the end. Pérez del Castillo announced that on Friday he would present a draft of the final ministers’ declaration so that it can be discussed by the WTO General Council, to meet Aug. 25-26.