TRADE: Brazil and India Dubious Ambassadors of the Poor

By Sanjay Suri Reprint | | Print |

Sanjay Suri

LONDON, Mar 10 2006 (IPS) - As the ‘G6’ trade talks begin in London, questions are growing louder how far India and Brazil can speak for the poorest countries.

The two-day talks beginning Friday among the ‘G6’ as they have come to be called count India and Brazil as representatives of developing countries talking to the United States, the European Union (EU), Japan and Australia.

These talks follow an earlier round of ‘G4’ talks in London before the Hong Kong meeting of ministers from member countries of the World Trade Organisation (WTO). Japan was only an observer at the earlier meeting, and Australia was not around.

These talks are not formally a part of the WTO negotiating process, but have become a parallel process attempting to break the deadlock in the WTO talks. The developing world says the developed have not done enough to cut agricultural subsidies, and the developed that the developing countries are not committing themselves to enough access for industrial goods and services. There is a range of contentious issues, but principally around this difference.

Goods from industrialised countries can severely disrupt labour and market forces within developing countries to varying degrees. Given this variance, many say that Brazil and India, the more advanced among the developing countries, should not speak for the poorest.

”Brazil and India clearly don’t speak for the poorest countries of the world,” Peter Hardstaff from the World Development Movement (WDM) told IPS. ”Brazil and India speak for Brazil and India, and any kind of coalitions that they get involved in like the G20 group on agriculture.”

The poorest countries have a problem with this kind of meeting in London because they are excluded, and not a part of these talks, he said. ”So there’s a real problem when you get these so-called mini-ministerials where a small group of countries come together even though it includes Brazil and India, to try and stitch up a deal.”

There are signs already that Brazil and India are not best qualified to speak for the rest, Hardstaff said.

”The outcome of the Hong Kong ministerial meeting last year was essentially a bad deal, it locked in a lot of really problematic agreements that are going to adversely affect developing countries, so it’s really hard to know how that’s going to be turned around. It looks like there is little prospect for a really positive development outcome, which is supposed to be the big theme of this round of negotiations.”

The European Union has very little flexibility to go much further on agricultural subsidy reform and agriculture market access, he said. ”And what the European Union is demanding that developing countries do, particularly the big developing countries, is to open their markets to European industrial products, open their markets to European service multinationals, and in return they say that maybe they can go a little further on agriculture.”

If the developing countries agree, they would be ”forced into a position of giving up their long-term development policy option in return for some potentially short-term gains in agriculture.”

But that seems to be where these talks are going, Hardstaff said. India and Brazil appear to be ready to start making deals with the major players. ”That in turn could have adverse effects on other poor developing countries.”

Hardstaff added: ”It is difficult to see how this kind of meeting which is essentially trying to come up with a stitch-up between six of the major players in the WTO is the right way to take decisions. The WTO has a membership of over 140, and yet we have six of the major players trying to stitch up a deal.”

But with 140 ministers hard to get at a negotiating table, others say the poorest countries need effective voices to speak for them, and that India and Brazil are doing that job, not always in their own national interest.

”India is keen on the success of the WTO,” Commonwealth Business Council director-general Mohan Kaul told IPS. ”It is keeping the developing countries’ interests very much at heart. On agriculture, some of it does not benefit India directly, but India is taking on the leadership role with that, and it is trying to facilitate discussions with the developed countries, particularly in trying to understand their political compulsions and trying to get a solution.”

India is well placed for that role, he said. ”It provides the interface in this transition, between both developed and developing countries. It has gained the trust of both parties.”

Hardstaff does not see India playing this leadership role. ”India’s position is quite confusing for me because India seems to be prepared to open up its markets in agriculture, open up its market in industrial products, that could adversely affect a lot of poor people in India. In return what India seems to want is Europe and the U.S. opening markets to Indian service professionals. That is going to benefit a relatively small group of people who are already more affluent.”

At the London talks ”we are going to see the Europeans demand that Brazil and India go further in opening their markets for industrial products,” he said. ”If they do, maybe Europe and the U.S. will go a little but further on opening their agriculture markets. What I can’t see is how in the long term this is going to be good for the poor in the developing world.”