|
|
|
|
|
With the missing of mini-ministerial deadline, and World Trade Organization talks in a limbo, developing nations are in a fix. India has made it clear to the WTO Director General Pascal Lamy as well as to the developed world that clash over farm subsidies by the US and Europe bodes ill for all. A look at the evolving trade strategies of the developed and developing nations. The missing of April 30th deadline for WTO talks is bad news for developing countries, who have missed their target for a deal on the mathematical formulas for reducing customs duties and other trade barriers, such as the subsidies to US farmers which have put Washington under the spotlight. The talks have been held up by persistent arguments, as developing countries press for greater access to wealthy markets for farm produce and rich nations in turn demand freer trade in industrial goods and services. The deadline had been part of a timetable set at a WTO conference in Hong Kong last December, in a drive to complete the Doha Round by the end of 2006, two years later than originally planned. The failure is a throwback to the World Trade Organization (WTO) ministerial in Hong Kong last December where the meeting made little progress toward making trade work for development. A more serious implication for the long-term future of a global trade regime, however, is the dissent the Hong Kong meeting revealed within the ranks of developing countries. The rich countries stonewalled on the most basic commitments to open their markets while lack of cohesion among the developing countries forced them to make steep concessions. Incoherence at the global level is a result of the collapse of the so-called Third World as an entity. The Third World has become divided into roughly 30 major trading nations-including China, India, Brazil, South Africa and Thailand-with substantial populations benefiting from trade, and the rest consisting of small, landlocked or poor nations that are not integrated into the world economy. G-20, a coalition of medium and large developing countries, was formed during the last WTO meeting in Cancun through the leadership of Brazil, India and South Africa, and served as a substantial counterweight to the rich countries, especially on issues relating to agriculture. Due to extraordinary political pressure exerted by the US and others, the G-20 has now withered to become a G-12 or even less. The G-33 is another grouping of developing countries led by Indonesia that has focused on issues such as special and differential treatment for the products of poor countries. Members of these coalitions have increasing disparities in levels of development. Large continent-sized countries such as India, China and Brazil have huge economies and a leadership position in sectors such as agriculture or textiles. Such nations play along with the Third World coalition so long as it suits their interests. Exacerbating this shift was the establishment of a special negotiating group consisting of the EU, the US, Australia, Brazil and India, which took over finalising draft text on the package of agreements containing the WTO General Council's decision on how to carry forward the agenda from the Cancun meeting in 2004 and played a strong role in smoothing disagreements in Hong Kong. In Hong Kong, the rich countries-especially the EU-refused to cut most subsidies for agriculture, which are largely domestic. The ostensible agreement by the EU to reduce export subsidies by 2013 is not a concession but a legal obligation that the EU has tried to postpone. Domestic subsidies and market access, much bigger issues for developing countries, were not even touched. The rich countries also refused full market access to the exports of poor countries, such as textiles, and chose to protect their domestic industries-a privilege denied to developing countries. On top of this, the rich countries extracted serious concessions from developing countries. The developing countries were forced to agree to harsh tariff reductions and free trade obligations in non-agricultural products, for example, fisheries. This agreement also threatens to eliminate all so-called non-tariff barriers, including measures for environmental protection or community development, and compels developing countries to negotiate trade in services from a position of weakness. Taken together, these measures pose the danger of further de-industrialising and impoverishing the Third World. India is spearheading a drive among developing nations to ensure that the WTO address "biopiracy" at this year's meetings. Along with countries like Brazil and China, India is seeking to prevent the international pharmaceutical industry from exploiting its native plants, animals and traditional remedies. Countries like India perceive biopiracy as a threat, particularly if a blockbuster drug, based on plants and animals from its jungles, is discovered and none of the profits return to India itself. The reality is that the interests of small and large, trading and non-trading, developing countries do not coincide anymore, if they ever did. For many smaller countries, especially in Africa, negotiating market access to commodities, such as cotton, is difficult, entangled with larger issues of domestic subsidies by the rich countries to their farmers. The WTO no longer represents poor or developing nations. Its rules force Third World countries to rush headlong into the global economy. Local firms and farmers are unprepared for global competition, and their governments cannot assist them, confronting restrictions that rich countries never faced during their early stages of growth. WTO procedures, among the most undemocratic in world politics, make a mockery of the principle of equality of states.
|
|
Issue Contents Write to us Subscription Syndication INDIA TODAY |
INDIA TODAY PLUS © Living Media India Ltd |
 |
