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TRADE: Poor Countries Demand Action

Stefania Bianchi

BRUSSELS, Dec 8 2005 (IPS) - The African, Caribbean and Pacific group of countries need proof that development truly is at the forefront of negotiators’ minds at the World Trade Organisation talks in Hong Kong next week, says a leading European parliamentarian.

“They want actions to match the fine language on sustainable development, governance and social cohesion,” Glenys Kinnock, British Socialist member of the European Parliament (MEP) and chair of the Parliament’s delegation to the ACP-EU Joint Parliamentary Assembly told IPS in an interview. “We face a watershed in Europe’s relationship with the ACP.”

Kinnock said the group of 78 African, Caribbean and Pacific (ACP) countries are feeling “increasingly marginalised and neglected”, and in Hong Kong “they will argue for better market access and for a recognition that their share of international trade is so small, in most cases, as to be irrelevant.”

Kinnock says the ACP countries share a “crucial and common concern” arising from their heavy dependence on European markets for the export of their agricultural commodities.

“They are suffering from the effects of falling prices, from their specialisation in exports of low value, and most of all, from the erosion of their preferential market access to Europe,” she said.

Trade ministers from 148 member countries of the WTO will meet in Hong Kong Dec. 13-18 to attempt agreement on the stalled Doha Development Round of trade talks, named after Doha in Qatar where the talks were launched four years back.

The negotiations are aimed at freeing up trade in a range of sectors from agriculture to manufactured goods and services. Developed nations want developing countries to open up their markets to industrial goods and services in exchange for any concessions on agriculture.

Agricultural tariffs and subsidies are the main obstacles to a new international trade agreement. EU tariffs on agricultural produce from developing countries raise the price of those products. At the same time, subsidies handed out to European farmers artificially lower the price of European agriculture produce. This makes most agricultural goods from developing countries uncompetitive.

As a self-confessed “veteran” of the Doha talks, and then of further talks that broke down in Seattle in the United States and then in Cancun in Mexico, Kinnock says she has a sense of “déjà vu” as she prepares for the meeting.

“Tensions are beginning to grow, just as levels of ambition are lowered,” she said. “The situation is clearly grim. How now can we avoid the kind of spectacular and shambolic collapse we have already seen twice before? If there is no progress, despair and hopelessness will set in.”

Kinnock says she will spend a great deal of time between her ACP contacts and European negotiators.. She said ACP countries now have an “unprecedented international identity, thanks to their prominent role at the WTO and in the group of 90 countries, which comprises the ACP nations, the African Union, and the least developed countries (LDCs).”

This group gained visibility when it defended the positions of the poorest countries during the failed WTO ministerial conference in Cancun, Mexico, in September 2003.

“They are well aware that the multilateral trading system is failing to make the essential contribution to their efforts to eradicate poverty in sub-Saharan Africa, as well as in the other marginalised countries in the Caribbean and the Pacific,” Kinnock said. “They would have wished that preferences could have been maintained until all domestic and export subsidies that so seriously affect their commodities were removed.”

Kinnock says recent WTO adjudications on sugar and bananas indicate the difficulties for ACP countries.

European Union (EU) agriculture ministers have agreed a 36 percent cut in the price of imported sugar over a four-year period starting July 2007. Kinnock says this “draconian” arrangement will threaten hundreds of thousands of livelihoods in the Caribbean..

“The adjustment is simply impossible for them, although they are making efforts to modernise, restructure and diversify. In the Caribbean alone, the losses are expected to be more than 130 million euros (154 million dollars),” Kinnock said.

“The sugar states are not supplicants – they are part of a partnership which is a legally binding arrangement. They naturally resent the fact that European beet farmers, drinks manufacturers and refiners are protected,” she added.

Last month Guyanese President Bharrat Jagdeo said “the agreement amounts to a betrayal which proves that the EU cannot be trusted.”

Kinnock says bananas have provided a “further test of our seriousness about honouring our mandate” on the Doha Development Round.

Under its new banana regime, Kinnock says Caribbean banana-exporting countries will lose the “predictability and stability” essential for production and shipping of fruit.

Ultimately, Kinnock says negotiators must ensure that the WTO Hong Kong talks have development and poverty reduction at their centre. “In the year of Make Poverty History, we should be ensuring that for so many developing countries we don’t make poverty the future.”