Developing nations have little hope for trade forum
Tessie Borden Republic Mexico City Bureau Sept. 7, 2003 12:00 AM
MEXICO CITY - This week's World Trade Organization meeting in Cancun will
pit developing vs. developed countries in the fight over opening a place
for small farmers in the world market.
Few believe the meeting of trade ministers will yield a real compromise.
"I'm not optimistic about what will happen in Cancun," said John Audley,
head of the Trade, Equity and Development Project at the Washington , D.C.-based
Carnegie Endowment for International Peace.
"They'll probably come up with some sort of patch over their differences
so they can declare it a success, but they really won't get to underlying
The United States wants the 147 member countries to sign on to a trade
and tariff deal to open markets for its products. But developing nations,
which for years followed the open-market dictates of the World Bank and International
Monetary Fund to get loans, are banding together, saying free trade only
makes the rich richer and the poor poorer.
They say the trade group's
rich countries subsidize large agricultural concerns so they can dump their
grains at below-cost prices and undercut small farmers from poor countries,
which are barred from subsidizing their farm sectors. Small farmers go broke
and poor countries then face high unemployment and dependence on rich countries
The trade group deals have to be reached by consensus. If a large segment
of members does not sign on to this week's final trade document, the talks
could collapse. They have before.
When the organization met in Seattle in 1999, rioting anti-global protesters
in the streets got much of the press coverage. But what made the meeting
a failure was a walkout by representatives of Third World countries who felt
their concerns were being ignored.
The next meeting, in Doha, Qatar, was much quieter, but grim-faced officials
had to promise that the next trade round, leading up to this week's Cancun
meeting, would be dedicated to helping poor countries mitigate the damage
free trade had done, particularly to their farm sectors.
Tariffs should drop across the world, they said. And rich nations should
stop subsidizing their agribusiness. They also should stop dumping their
corn, wheat and coffee on the world market.
None of that has happened.
Critics point to Mexico
Mexico, nearly 10 years after the North American Free Trade Agreement,
has turned out to be a perfect showplace for free-trade critics. Its farm
sector, composed almost entirely of small producers on minimal plots, could
not compete with efficient, mechanized American farming that maximized production
of yellow corn and other grains.
NAFTA opened Mexico to the grain
imports, and the protected internal market the farmers had till then, when
they sold their grain to the Mexican government, collapsed. Similar crises
have hit coffee and orange farmers.
At the same time, Mexico dropped most farm supports, leaving only programs
that have benefited Mexican agribusiness. Critics say the United States continued
subsidizing agribusiness after NAFTA, which was supposed to end those supports.
With no way to feed their families at home, the farmers headed to the United
States to take up jobs that NAFTA promised but never created in Mexico, joining
what has become one of the largest and most sustained migration waves in
Developing countries don't want a retreat from free trade, said Anuradha
Mittal of Food First, a progressive trade think tank. They simply want fairer
rules and a way to enforce them, even on influential rich countries like
the United States and Japan and on the European Union. They want the things
promised at Qatar.
"They are trying to give us a new check when the old check has already bounced
on us," Mittal said. "The fact that they are already saying this is not an
end deal, and that negotiations will continue means this is the third successive
failure for the WTO."
During an August conference call, Deputy U.S. Trade Representative Peter
Allgeier said the U.S. goal is "to seek a high level of ambition in opening
markets and expanding trade for all countries."
No final deal expected
Allgeier said that agriculture is key to the success of the meeting
but indicated that he does not expect a final agreement to come out of Cancun.
"We don't expect people to agree on what we want the agreement to look like
at the end," Allgeier said. "It's very important to realize that this is
the midpoint, and so the idea is to ensure that you've got the opportunity
to negotiate high-ambition results."
At the trade organization, an alternative fair will promote "fair trade"
measures, including coffee and cocoa produced in Mexican farm cooperatives
that sell the products as socially responsible alternatives. Mexican Foreign
Minister Ernesto Derbez will speak at the fair, and organizers hope that
will lend it a higher profile.
But it's doubtful ministers from the rich countries will pay much attention.
Mark Ritchie of the Institute for Agriculture and Trade Policy, said they
have little incentive to change their practices, and it's natural for each
country to seek an advantage for its interests in any trade deal.
Critics saw some reason to hope for a compromise a week ago, when trade-group
countries reached a tentative deal to allow poor countries to bypass patent
rights to buy or produce lifesaving medicines for critical problems like
The United States had blocked such an agreement in deference to pharmaceutical
companies, which argued that their patents, on which they rely for profits,
would be endangered by freer access. The details of the new deal are to be
worked out in Cancun.