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WTO-CANCUN: Trade Ministers Arrive Amidst Gloomy Forecasts

Diego Cevallos

MEXICO CITY, Sep 9 2003 (IPS) - On the eve of the WTO’s Fifth Ministerial Conference it is difficult to find anyone who predicts a happy ending, one with loud applause for its success, as occurred at the Fourth ministerial two years ago in Doha, Qatar.

The forecasts of World Trade Organisation officials, of trade ministers, analysts and representatives of civil society groups range from moderate optimism to total failure, due to the inability to reach prior agreements on farm trade, a key issue in the trade-liberalising negotiations.

WTO director-general Supachai Panitchpakdi says that, unlike what some observers have suggested, the meeting of the organisations 146 member states is not a question of winning and losing.

"It will be neither a success nor a failure," the official told the Mexican newspaper El Universal, referring to the Sep. 10-14 meeting of trade officials in the resort city of Cancun, on Mexico’s Caribbean coast.

The aim of the Cancun meet is not to initiate or wrap up trade talks, Panitchpakdi stressed.

Eduardo Ramos, director of international programmes at Mexico’s economy ministry, said in an IPS interview that "spectacular decisions" should not be expected in Cancun, because it is a follow-up meeting and that discrepancies persist among the member countries.

The objective of the Cancun ministerial conference is to advance the trade-liberalising talks laid out in what is known as the Doha Development Agenda, defined by the WTO ministers at their fourth conference, held in November 2001 in the Qatar capital.

The Doha Agenda, which sets January 2005 as the negotiations deadline, aims to bring developing countries closer to the presumed benefits of free trade through measures that must be adopted unanimously by the 146 WTO members.

If the Doha Agenda is implemented and if the farm subsidies applied by the nations of the industrialised North are gradually eliminated, global welfare would improve to the tune of 748 billion dollars, says the WTO in its 2003 annual report.

Trade growth associated with the reduction of agricultural subsidies – which amongst the rich nations of the North total almost a billion dollars a day – would allow a reduction in poverty worlldwide of no less than 13 percent by 2015, according to the WTO.

Germán de la Reza, expert in trade and integration, told IPS that "the conversations between the United States and Western Europe to reduce agricultural subsidies have not let up, which suggests that their representatives will have an additional proposal to announce in Cancun."

"No country wants the ministerial conference to fail, because at stake is a great deal of previous effort and resources as well as interests," said the expert.

But the discrepancies in the farm trade talks do not seem to be attenuating. A bloc of 20 developing countries, led by Brazil, is demanding that the EU and United States go farther in dismantling their systems for supporting farmers and subsidising agricultural exports than proposed in an EU-U.S. initiative last month.

The tensions reached the point that EU agriculture commissioner Franz Fischler said the demands of the 20 countries gave "the impression that they are circling in a different orbit."

If the group of developing countries continues "their space odyssey, they will not get the stars, they will not get the moon, they will simply end up with empty hands," said Fischler.

Robert Zoellick, the U.S. trade representative, in regards to the discord, warned that if the WTO negotiations fail, Washington would hammer out trade deals with those countries that want to "move forward".

Oxfam International, the Britain-based humanitarian organisation, states in its report "Running into the Sand in Cancun", that the Fifth Ministerial Conference is the final opportunity for industrialised countries to comply with what has been dubbed the Doha Round of negotiations.

"Failure at Cancun would do to the WTO what the Iraq war did to the United Nations: undermine its influence and marginalize it," says Oxfam.

The Latin American Economic System (SELA, for its Spanish initials) joined others with its hardly optimistic predictions, stating that it is unlikely that the trade ministers in Cancun will achieve positive results, given that the preparatory talks could not resolve key differences between the industrialised North and the developing South.

Among those who forecast a total fiasco – some of whom admit that this is their goal – are various civil society organisations that are participating in the People”s Forum for Alternatives to the WTO, a count-event of nearly a thousand groups taking place parallel to the official meet in Cancun.

"We are staking our bets on the complete reformulation of the WTO," so a complete failure of the ministers’ conference "would be best," Héctor de la Cueva, spokesman for the Mexican Network of Action Against Free Trade, told IPS.

Thousands of delegates from non-governmental organisations (NGOs) and independent activists, who say they are against the globalisation model being negotiated at the WTO, are gathering this week in Cancun’s parks and plazas, while the ministers meet at a modern convention centre.

The objective of many participants in the alternative forums and protests is to "derail" the ministerial conference.

Mexican economy official Ramos is calling upon the trade representatives to make the greatest effort to attain agreements. "Mexico, as host, is drawing on all its abilities to bring the different parties together," he said.

The agreement reached last week on facilitating poor countries’ access to low-cost, generic medicines is an example to be followed, said Ramos.

The official noted that the WTO members, after two years of negotiations, agreed Aug. 30 that developing countries can import generic drugs for fighting health emergencies such as HIV/AIDS, tuberculosis, and malaria.

Generics are identified by their active ingredients and are much cheaper than their trademarked equivalents, owned by transnational pharmaceutical laboratories.

However, on other trade issues, like industrial tariffs, market access, intellectual property, investment and agriculture, among others, negotiations are still pending – and time is up for any pre-conference accord.

Gobind Nankani, vice-president of the poverty reduction network of the World Bank, says the success of the Doha Round is of crucial importance because it could "make a difference for millions of poor people around the world."

An agreement on reducing farm subsidies is essential, he said, noting that the sums the rich countries give their farmers is greater than the combined gross domestic product of Africa and is six times the total spent on development aid worldwide.

But the path of the negotiations has not yet been able to eliminate farm supports or produce accords on other issues, meaning that "the strong and open trade" that the WTO says is necessary for global development remains in its nascent stages, just like the Doha Round itself.