WTO:  RICH, POOR NATIONS AT ODDS  OVER  FARM  TRADE

[PHOTO AT LEFT - NO TO LIBERALIZATION: Demonstrators hold placards during a protest against World Trade Organization talks being held in Hong Kong, calling on world trade leaders to junk liberalization which they say has led to the dumping of cheap goods that unfairly compete with local products. Photo by VAL RODRIGUEZ]

HONG KONG, December 14, 2005 (STAR) By Rocel C. Felix - Rich and poor nations were at odds as a World Trade Organization meeting opened here yesterday, with trade ministers saying a breakthrough is unlikely on the thorny issue of agricultural trade that has held up negotiations for months.

An impasse over farm trade has brought the negotiations to a virtual halt, with developing nations accusing the US, EU and other rich economies of not cutting agricultural tariffs and farm subsidies enough, effectively keeping out poorer nations that depend heavily on agriculture as an income source.

At the start of the sixth ministerial conference of the World Trade Organization (WTO) the G-33, a group of developing countries led by the Philippines and Indonesia, are pushing hard for the adoption of "special products (SP)" or sensitive products category that will have no minimal tariff reduction, and the use of special safeguard mechanisms (SSM) to stem the negative impact of import surges and chronically low world prices on their domestic agriculture producers.

"These are the two critical issues for agriculture-based economies like the Philippines and this is where we expect the talks to get really tough but at this point, there is no lowering of ambitions and we donít have room for trade-offs," said Philippine Agriculture Secretary Domingo F. Panganiban.

Panganiban and other agriculture ministers from developing countries agree that developing nations should be able to craft their own trade policies based on their own development strategies and these include being given the flexibility to determine appropriate tariff measures and safeguards.

This rests largely however, on how the WTO talks in global agricultural trade trade will shape up.

EU Commissioner Peter Mandelsonís view however, reflects the western worldís disparate view of an acceptable free trade agreement.

"Developing countries should also make industry and trade part of their development policy, we are willing to do business. If developing countries also raise their ambitions in areas outside of agriculture. The exclusion of other areas of trade will defeat that ambitions we are trying to achieve, there must be a balance of ambitions."

The EU has stressed repeatedly that its further opening up of its agriculture sector hinges on developing countries agreeing to advance talks on non-agriculture market access or NAMA which includes manufacturing products, fuels, mining products, fish and fishery products and forestry products, among others.

The EUís bottomline position of reducing its trade-distorting subsidies, along with the USí own proposal to cut its tariffs and subsidies in five years however, with a number of exceptions does not sit well with poor countries.

"Our concern is that fair trade is being defined by the developed countries as equalizing tariffs which is not only unfair but deceptive," said Alyansa Agrikultura chairman and former Philippine Agriculture Undersecretary Ernesto OrdoŮez.

Ordonez said developing countries want the rich countries to eliminate years of trade-distorting domestic support and export subsidies that create artificially low prices of agricultural produce that are dumped in poor nations.

While the US, EU and Japan committed in the WTO 2004 July framework to reduce their maximum subsidy levels by 20 percent to $156 billion, this is still higher than their 2000 actual subsidy level of $118.1 billion.

In contrast, developing countriesí subsidies for their farm sector pale in comparison to the perks enjoyed by farmers in the western world.

The Philippines for instance, has one of the lowest subsidies for the agriculture sector in Asia. Worse, its existing applied tariff rates are already very low compared to WTO bound rates. If the WTO talks on agriculture again favor developed countries, the Philippines will be forced to further commit to lower tariff rates.

"The rich countries are trying to limit the issue on tariffs but what poor countries are going for are the elimination of their export subsidies and domestic support which has created this uneven playing field. For poor countries like the Philippines, we should not agree to anymore bound rates for products that are currently unbound," stressed OrdoŮez.

Bloomer stressed there can be no pro-development round without meaningful progress on agriculture.

"What is on the table now from the EU and US is not good enough," he added.

Oxfam also warned that any progress on agriculture that Ministers might make at the meeting was in danger of being cancelled out by damaging agreements on services and industrial market access.

"The content of the proposals on industry and services is extremely worrying and the pressure being put on poor countries to make further concessions is unacceptable. There is nothing here for development and unless rich countries reduce their demands and grant developing countries room to protect jobs and fledgling industries, the results will be devastating."

Philippine Agriculture Undersecretary Segfredo Serrano said developing countries are facing a major handicap because of their diverse positions, especially on NAMA which the EU and US are trying to take advantage of.

He said however, that the fragile G-33 coalition is still focused on trying to achieve real reforms in global agricultural trade.

"We donít want a status quo," he said.


Chief News Editor: Sol Jose Vanzi

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