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DEVELOPMENT: ‘New Trade Geography’ May Democratise Int’l Arena

Mario Osava

SAO PAULO, Jun 18 2004 (IPS) - What occurs in the larger developing countries – China, India and even Brazil – increasingly impacts the industrialised world, which will have to do more to include their poorer peers in international decisions if they are going to have legitimacy.

This summarises the opinion that came out of Brazilian Foreign Minister Celso Amorim’s conversation with IPS as he took stock of the eleventh sessions of the United Nations Conference on Trade and Development (UNCTAD XI), held in Sao Paulo this week.

UNCTAD XI was very productive, as were the numerous parallel meetings it attracted to this Brazilian metropolis, says Amorim.

Progress was made by what is known as the P5 (Five Interested Parties) that could unblock the ever-troubled farm trade talks in the World Trade Organisation’s Doha Round. The ”parties” are key players in the agricultural debate: Australia (representing the Cairns Group), Brazil, European Union, India, and the United States.

The Group of 20 (G20) developing nations opposed to farm subsidies, a bloc that emerged just prior to the disastrous WTO ministerial meet in Cancún, Mexico in September 2003, reaffirmed its unity and detailed some of the concepts it will defend.

And Mercosur (Southern Common Market) and the EU reached some understandings. The South American bloc, comprising Argentina, Brazil, Paraguay and Uruguay, and the Europeans have been negotiating a free trade agreement in fits and starts.

Amorim spoke with IPS about the relationship between trade negotiations like these and the larger trend towards democracy in international relations, such as in the G8 (Group of Eight industrialised countries) and the U.N. Security Council. Following are excerpts from that interview:

– You have been talking about a new “geography of trade”, but given what is happening in the world, as evidenced by what took place during UNCTAD XI, isn’t it something broader? A shift in the global balance of power?

– I hope you are right. We are working to strengthen our bargaining position and that of other developing countries, in both the economic and political spheres. I think the G20 is today an undisputed and indispensable actor and, not only that, it is perceived as constructive in trade negotiations, which have completely changed. I participated in the previous trade rounds in which countries like Brazil and India played a role, but the big decisions were taken by the European Union and the United States, sometimes with Japan and Canada. The developing countries came in merely to add a comma here, an accent there.

But not any longer. We are part of the fundamental negotiations, even those that involve the (EU and United States), such as the question of maintaining parallelism between the two in eliminating subsidies and other forms of support for agricultural exports. Of course we don’t have the capacity to dictate anything, but we are often able to contribute to the negotiations between them.

– What do you think of the talk of China’s possible entry into the G8? Will something concrete come of this?

– I didn’t see anything specifically about that, except a statement by the Italian prime minister saying that China and India might be admitted. I learned through my sources that there were discussions, though very cursory, about the possibility of expanding the group. But in those same conversations, France, for example, mentioned Brazil. Other people I spoke to, who are well informed, said nothing has begun in any sort of decisive process.

– Wouldn’t this potential inclusion of China, Brazil and India in the G8 be recognition that there has already been a significant redistribution of power in the world? And not just economically speaking?

– I think it is recognition that they can’t make decisions (on global matters); the G8 can’t, even in regards to its own expansion for a G11 or G12, because things have to be resolved in a more institutional manner. The same goes for preparing work that afterwards will have to be discussed institutionally. They can no longer bring together seven rich countries, or eight with Russia, to take a decision.

Today’s world is very complex. What is happening in China, in India and in Brazil will have impacts in the rich countries. (Our inclusion in the G8) wouldn’t be just to do us the favour of recognising our importance, it would be important for those countries themselves.

– Would the G8’s possible admission of China, for example, cause divisions in the groups of developing countries, like the G77 (Group of 77 developing countries) or G20?

– If it were the admission of just one country, whichever it was, it would indeed have that implication. But not the admission of a group, even if it is small, three or four – China, Brazil and India. Perhaps an African country as well – we can’t ignore Africa. And an Arab country. It depends whether it is going to expand to G10, 12 or 15.

– Would that alter the nature of the G8?

– Certainly. It would change it for the better. It would be a bit more democratic because it would have a greater diversity of opinions. And also more effective, because it would be seeing the real situations that exist in the world. Today there are developing countries whose GDP might not be as high as the developed countries – in some cases it is, if you consider purchasing power – but whose ability to influence, positively or negatively, in the international exchanges is greater.

That is in relation to the European countries, for example, which, because they follow a more or less unified policy, they might individually wield a good deal of weight economically, but politically are subject to a single set of rules. In most developing countries, that doesn’t happen.

– But wouldn’t that divide the G20 or G77? Would it be possible to participate in an expanded G8 – a grouping of wealthy nations – and also in the G20, which are all developing countries?

– The G20 is the greatest success in the history of humanity in terms of the creation of international groups. It is not yet a year old and everyone talks about it as if it were a group that should handle issues beyond farm trade. The G20 has obvious potential, but it was created for the agricultural trade negotiations in the WTO. If we could maintain the cohesion of that group for other negotiations, so much the better.

If you were to take a closer look, there are countries in the group that have disputes amongst themselves on other issues. They are united in the fight to end agricultural subsidies and for greater market access of developing countries. Although the objective is agriculture, we have a similar viewpoint on the issues of the (WTO’s Doha Round). But we would never be able to draw up a platform on all the issues. On the Singapore issues (pending from previous rounds), we have different positions within the G20. The problem didn’t come up because it was better resolved by the G90 (a group specifically opposed to inclusion of the Singapore issues in current negotiations).

– Are there also differences in the G20 about access to agricultural markets?

– There could be differences in terms of nuances. Our interests are not identical, but we know that if we are united we can wield influence in the negotiations on fundamental questions. If we are disunited and defending individual interests we won’t have any influence at all. We won’t make any gains in those fundamental issues or in other areas.

– Will this reorganisation of the international trade arena help towards the expansion of the U.N. Security Council? Is it a similar trend?

– I think the Security Council will have to be democratised sooner or later. It is a trend because there is a perception, among developing and developed countries alike, that if the Security Council is to maintain legitimacy, if its decisions are to be heeded and supported, it is essential that the U.N. members see it as a body that represents the community as a whole. Clearly there will be differences about how it should be done, but there is no doubt about the need to reform the Security Council. There is no doubt that it is impossible for the Council to continue with its five permanent members, which are the five that have been there 50 or 60 years. But the details of reform will not be easy. We will have to continue debating. It is an important moment because (U.N. Secretary-General Kofi Annan) has created a High Level Panel which could foster the conditions for reform or some sort of transition.