By Gustavo Capdevila
DAVOS, Switzerland, Jan 22 2004 (IPS)

The director-general of the World Trade Organisation rejects the idea of separating agriculture from the rest of the issues in the Doha Round as a means to kick-start the foundering multilateral negotiations.

Supachai Panitchpakdi, WTO chief and former prime minister of Thailand, argues that the majority of the 147 member countries would not agree to conclude the round of talks without finding a solution to the thorny question of agricultural trade.

In an IPS interview, Supachai said Thursday: "Agriculture is a standard, it is a measurement" of the outcome of the Doha Development Round, the tag given the trade liberalisation process agreed at the WTO ministerial conference in the Qatari capital in November 2001.

In addition to agriculture, the round encompasses talks on trade in services, industrial tariffs, special and differentiated treatment for poor countries and implementation of pending aspects in favour of the developing South.

The agenda also includes the so-called Singapore issues: trade in investment, competition policy, transparency in government procurement and trade facilitation.

The World Economic Forum, during its annual meeting of corporate executives, financiers, economists and government leaders this week in the Swiss alpine resort of Davos, organised a debate Thursday on the challenges of the Doha Round.

"Agricultural issues should be separated out in the negotiations so that progress can be made on the other issues," said John H. Tyson, chairman and CEO of the U.S. corporate giant Tyson Foods.

U.S. economist Dani Rodrik, of Harvard University’s John F. Kennedy School of Government, said he thinks "too much emphasis is being put on the farm subsidy problem."

Most industrialised nations, with the European Union, United States and Japan in the lead, together spend an estimated billion dollars a day on production and export supports for their farm sectors.

Development activists blame the subsidies for pushing hundreds of millions of peasant farmers out of the market, mostly in marginalised regions of developing countries, and for aggravating the problems of extreme poverty and hunger around the world.

Joseph Deiss, president of the Swiss Confederation, noted in a Davos Forum address that there are 1.2 billion people in the world forced to survive on incomes of barely a dollar a day.

Rodrik, an economist who experts from the developing countries usually listen to with great interest, told those gathered for the debate that "the focus of a true development round should not be agriculture at all."

The negotiations launched in Qatar were dubbed the "Doha Development Round" by the trade ministers from industrialised countries. Many of the ministers from the countries of the South made it known that they would prefer to see the results before accepting that name.

According to Rodrik, there are other areas, besides agriculture, which are "hardly discussed at the moment and could bring far more immediate benefit to developing countries than the removal of farm subsidies in the EU and the United States."

For example, the negotiations on trade in provision of services encompass transborder movement of labour. An agreement in this area would allow people from poorer nations to move temporarily to richer countries to work, he said.

"Even a modest agreement could bring an additional 200 billion dollars annually to developing countries, largely in the form of remittances" that the temporary immigrant workers send to their families in their countries of origin.

But the WTO chief maintains that, despite the possibilities of advancing in other trade issues, most of the member states do not want to stop the talks on farm trade, they do not want to conclude the Doha Round without agriculture.

"They want to know how far we can go with agriculture before they give in other areas," said Supachai.

He acknowledged that negotiations on other issues are less complicated, such as market access for industrial goods. But there is a push to continue with the agricultural trade question, he said.

The Doha Round, underway since January 2002, suffered a serious setback at the WTO ministerial conference last September in the Mexican resort city of Cancún.

Although the failure of the meet to produce any agreements was blamed on disputes related to the Singapore issues, the five-day conference accentuated the divide separating the rich countries from the poor on the farm trade issues.

Two weeks ahead of Cancún, in response to a joint declaration by the EU and the United States on agriculture, a new bloc was founded within the WTO, the Group of 20 developing countries, now led by Brazil, with the active participation of Argentina, China, India and South Africa.

Rodrik commented that the positive outcome of the last ministerial conference was the emergence of the G20, "and the fact that they stuck together in Cancún despite strong pressure.

The new bloc is "perhaps very good news for the future of the world trade system," he said.

He criticised the current consensus-based system in effect at the WTO, in which negotiating rounds are based on the notion of "single undertaking", in other words, no final agreement until all issues on the agenda are resolved.

That system "was reasonable in the past, when trade rounds were seeking agreements on tariffs and other broader issues," but is inefficient for negotiating matters that have impacts on the domestic fiscal and financial policies of the countries involved, said Rodrik.

The progress of the Doha Round will be scrutinised this week in Davos by a group of trade ministers convened by Swiss president Deiss, who also serves as Switzerland’s minister of economy.

Yu Yongding, director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, said the process of global trade liberalisation has reached a "dialectical moment" in which industrialised countries "have to make sacrifices and introduce unpopular domestic adjustments."

These changes must be introduced especially in the area of farm subsidies, said the Chinese expert. "If you are always concerned about votes (in domestic elections), you will never reform."

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