Rich and poor countries Saturday night pledged to secure a new global trade accord by the end of next year after a week of intensive negotiations and banished immediate fears of a new era of protectionism by agreeing to cut deep into the Wests lavish farm subsidies, reports the World Bank press review Monday.
Negotiators described as “historic” an 11th-hour deal in Geneva which ended almost a year of wrangling between the developed and developing world over the shape of a new trade liberalization agreement designed to offer access to lucrative western markets for poor nations.
Pascal Lamy, the European Unions trade commissioner, said he was now hopeful that the talks could be completed by the time trade ministers next meet in Hong Kong in December 2005, following last-minute concessions by both Washington and Brussels to appease the developing world.
Under the agreement signed in Geneva, the 147 members of the WTO agreed to a framework for liberalizing trade in agriculture, manufacturing and services, as well as updating customs procedures that have remained unchanged for more than half a century. Negotiators agreed to eliminate export subsidies and other forms of government support for farm exports, but provided no timetable for reform.
Under pressure from Brazil and India, the EU and the US also offered a “down payment” that would see an immediate 20 percent cut in the maximum permitted payments by rich nations. The highest agricultural import tariffs will face the biggest cuts, although no figures have yet been agreed upon. Nations will have the right to keep higher tariffs on some of the products they consider most important.
The Financial Express of India noted Sunday that India claimed victory at the WTO for being able to successfully protect its interests in agriculture and other key areas.
According to an official release, the WTO framework meets Indias key demands aimed at preserving the countrys domestic policy space by providing for special products; special safeguard mechanism; and special and differential treatment in respect of market access in agriculture. Also, India has scored with the dropping of the three Singapore Issues relating to investment, competition policy and government procurement from the Doha agenda.
The New York Times writes that for developing countries that had succeeded in transforming the seemingly dull issue of farm subsidies into an international cause celebre complete with rock-star patronage, the WTO agreement was a moment of triumph.
The global campaign – amplified by the World Bank, the United Nations and the charity Oxfam International – helped push representatives of the advanced economies to give in to pleas to cut back some of their 300 billion US dollar in annual subsidies and supports that have pushed down commodity prices, impoverished farmers in the developing world and prevented them from competing on the world market.
The Financial Times also notes that the Group of 90, a coalition of mostly poor countries that triggered the Cancun collapse by rejecting EU and Japanese demands for new trade rules, seems to have secured a better deal than they would have in Mexico.
The new accord goes much further than proposals in Cancun to meet the groups development concerns, including a commitment to tackle the vexed issue of US cotton subsidies “ambitiously, expeditiously and specifically”. The G90 has agreed to negotiations about one set of new WTO rules – for simplifying customs procedures – on the understanding that poor countries will not have to make unaffordable commitments.
In Geneva, poorer nations came better prepared and disciplined than in Cancun. African countries, which precipitated the final collapse in Mexico, fielded a capable and level-headed negotiating team headed by Rwanda. It kept the continent more or less united while reining in its more militant representatives.
In contrast to previous WTO meetings, many poorer countries bargained hard on the nuts and bolts of international trade policy. Although they won only part of what they wanted – for example, on US cotton subsidies – they kept their tempers and threatened no mass walkouts. That suggests a learning process is under way that may reduce an important stumbling block in future negotiations.
Meanwhile the West African countries left Geneva on Sunday with the promise that their struggle against US cotton subsidies will be taken into account by the WTO but with no concrete guarantees that their struggling workers face a rosier long-term future.
The WTO and African delegates see the accord from a political and upbeat standpoint, welcoming it as the “first step” towards an actual reduction in US subsidies. But an analysis of the facts shows that there is nothing concrete in it in terms of dates or figures, and that it is entirely dependent on the goodwill of the Americans.
– This will change absolutely nothing for rural Africans who are sinking into poverty, said development aid charity Oxfam International.
Sunday pressure groups said that the deal did not guarantee reforms to help the poorest countries. “There are no cast-iron commitments here and no clear timeline for reform,” said Celine Charveriat, head of Oxfams Geneva office.
– The lives and jobs of millions of people depend on these talks but rich countries are still failing to show leadership, pandering instead to vested interests and forcing developing countries to adopt a strategy of damage limitation, added she.
Larry Elliot of The Guardian commented Monday that developing countries may have left Geneva encouraged that the US and the European Union have promised deep cuts in farm support, but they have little concrete yet to show for their efforts.
Brussels and Washington are experts in obfuscation and delay, superb at extracting the maximum political advantage from the smallest of concessions. There are no cast-iron commitments and no clear timetable. The US says, for example, that it will do something about its subsidies to cotton farmers, but is vague about the what and when.
Kilde: www.worldbank.org
