Christian Aid laments feeble trade round for world’s poor

Christian Aid laments feeble trade round for world’s poor

-19/12/05

By Dr Claire Melamed, Christian Aid.

The World Trade Organisation’s sixth ministerial in Hong Kong might not have crashed as spectacularly as those at Seattle and Cancun. However, the deal will have as little impact on the world’s poor people.

As expectations for the meeting were scaled down during the past week, the one thing many believed might come out of this meeting was a deal on granting market access to products from the poorest countries.

But in the end, even that failed to materialise. Rich countries left themselves so many exemptions that what was agreed is unlikely to lead to many new exports from the poorest countries to rich ones.

The rest of the deal puts all the difficult decisions off – to be negotiated at the WTO’s HQ in Geneva – but it does make it harder for poor countries to win concessions once there.

On services, one of the most controversial aspects of this weeks’ discussions, WTO members have accepted tough new disciplines that will affect the kind of deals developing countries are able to negotiate and are likely to make them liberalise more – not something that will necessarily be in the interests of poor countries.

Rich countries have finally agreed an end date for agricultural export subsidies. By 2013, there should be no more payments supporting exports from rich country governments to their farmers and food companies.

This is a step forward – but one that is more symbolic than real, as the actual cuts in subsidies that will result are tiny – less than 5% of the total amount that the EU and others pay to their farmers.

On the important question of other payments to farmers in rich countries, the text makes it less likely that there will be significant reforms on domestic support. Poor countries will also get no more access to rich countries’ agricultural markets as a result of what’s been agreed here – they will have to negotiate that in Geneva before a single tariff comes down.

On industrial products where rich countries were pushing the poorer ones to lower their tariffs, the deal could prove bad news for developing countries. The imposition of a so-called ‘Swiss formula’ – the calculation used to bring down tariffs – was a measure developing nations had been arguing hard against throughout the conference.

When the negotiating over numbers starts in Geneva, it is likely that this ‘Swiss formula’ will mean poorer nations will have to cut their protective tariffs more than rich countries.

However, there were a few glimmers of hope in a bad week. The alliance of big developing countries – the G20 – that was so decisive at the last WTO ministerial in Cancun held together here, and was joined by the group of smaller developing countries, the ‘G-90’.

The new group, inevitably tagged the ‘G-110’, contributed to a stronger developing country negotiating position. A minor but significant victory saw poor countries resist attempts to set limits on the number of crops that can have special protection to help poor farmers.

The deal coming out of Hong Kong will make things tougher for developing country negotiators in Geneva, and any promise of actual gains from this Ministerial has evaporated in the face of outrageous intransigence by the rich countries.

The year 2005 was supposed to be the year that trade rules were reformed to ‘make poverty history’. But at the end of the year, there are no definite changes except a date for the end of export subsidies – probably the best trailed promise in the history of trade talks and one the EU has used all year to extract the maximum concessions from everybody else.

In 2006, the real business of reforming trade rules will start again in the back rooms of the WTO building in Geneva. The Hong Kong deal will make it less likely that the Doha round will be a real ‘development round’, as promised when it was launched in 2001.

This is a sorry return for a year of global campaigning. The world should be shocked that once more self-interest has dominated – to the extent that rich countries could not even make the most minimal concessions to the poorest countries.

If the EU and the US could not bring themselves to deliver a plan that would have given so little, how on earth will they make the concessions required to give poor people a decent chance to turn their lives around through fairer trade.

The auspices for Geneva are not good.

Claire Melamed is head of trade policy at Christian Aid, a UK-based international development, relief and advocacy agency.

[Also on Ekklesia: WTO heading for slow suicide, says church agency 19/12/05; Anger spills over at WTO in Hong Kong 18/12/05; Trade justice hangs in the balance 17/12/05; Poor countries unhappy at British trade talks tactics 17/1/05; World Trade deal only worth one cent a day says Christian Aid; Christian Aid laments receding trade talk hopes; Christian Aid warns of trade talks walk-out after leak]

Christian Aid laments feeble trade round for world’s poor

-19/12/05

By Dr Claire Melamed, Christian Aid.

The World Trade Organisation’s sixth ministerial in Hong Kong might not have crashed as spectacularly as those at Seattle and Cancun. However, the deal will have as little impact on the world’s poor people.

As expectations for the meeting were scaled down during the past week, the one thing many believed might come out of this meeting was a deal on granting market access to products from the poorest countries.

But in the end, even that failed to materialise. Rich countries left themselves so many exemptions that what was agreed is unlikely to lead to many new exports from the poorest countries to rich ones.

The rest of the deal puts all the difficult decisions off – to be negotiated at the WTO’s HQ in Geneva – but it does make it harder for poor countries to win concessions once there.

On services, one of the most controversial aspects of this weeks’ discussions, WTO members have accepted tough new disciplines that will affect the kind of deals developing countries are able to negotiate and are likely to make them liberalise more – not something that will necessarily be in the interests of poor countries.

Rich countries have finally agreed an end date for agricultural export subsidies. By 2013, there should be no more payments supporting exports from rich country governments to their farmers and food companies.

This is a step forward – but one that is more symbolic than real, as the actual cuts in subsidies that will result are tiny – less than 5% of the total amount that the EU and others pay to their farmers.

On the important question of other payments to farmers in rich countries, the text makes it less likely that there will be significant reforms on domestic support. Poor countries will also get no more access to rich countries’ agricultural markets as a result of what’s been agreed here – they will have to negotiate that in Geneva before a single tariff comes down.

On industrial products where rich countries were pushing the poorer ones to lower their tariffs, the deal could prove bad news for developing countries. The imposition of a so-called ‘Swiss formula’ – the calculation used to bring down tariffs – was a measure developing nations had been arguing hard against throughout the conference.

When the negotiating over numbers starts in Geneva, it is likely that this ‘Swiss formula’ will mean poorer nations will have to cut their protective tariffs more than rich countries.

However, there were a few glimmers of hope in a bad week. The alliance of big developing countries – the G20 – that was so decisive at the last WTO ministerial in Cancun held together here, and was joined by the group of smaller developing countries, the ‘G-90’.

The new group, inevitably tagged the ‘G-110’, contributed to a stronger developing country negotiating position. A minor but significant victory saw poor countries resist attempts to set limits on the number of crops that can have special protection to help poor farmers.

The deal coming out of Hong Kong will make things tougher for developing country negotiators in Geneva, and any promise of actual gains from this Ministerial has evaporated in the face of outrageous intransigence by the rich countries.

The year 2005 was supposed to be the year that trade rules were reformed to ‘make poverty history’. But at the end of the year, there are no definite changes except a date for the end of export subsidies – probably the best trailed promise in the history of trade talks and one the EU has used all year to extract the maximum concessions from everybody else.

In 2006, the real business of reforming trade rules will start again in the back rooms of the WTO building in Geneva. The Hong Kong deal will make it less likely that the Doha round will be a real ‘development round’, as promised when it was launched in 2001.

This is a sorry return for a year of global campaigning. The world should be shocked that once more self-interest has dominated – to the extent that rich countries could not even make the most minimal concessions to the poorest countries.

If the EU and the US could not bring themselves to deliver a plan that would have given so little, how on earth will they make the concessions required to give poor people a decent chance to turn their lives around through fairer trade.

The auspices for Geneva are not good.

Claire Melamed is head of trade policy at Christian Aid, a UK-based international development, relief and advocacy agency.

[Also on Ekklesia: WTO heading for slow suicide, says church agency 19/12/05; Anger spills over at WTO in Hong Kong 18/12/05; Trade justice hangs in the balance 17/12/05; Poor countries unhappy at British trade talks tactics 17/1/05; World Trade deal only worth one cent a day says Christian Aid; Christian Aid laments receding trade talk hopes; Christian Aid warns of trade talks walk-out after leak]