Global Issues
TRADE: 'We Won’t be Frogmarched Towards a Doha Conclusion'
In a rare meeting of minds, a parliamentarian, a civil servant and a trade unionist, all three from Africa, agreed that the current course of the World Trade Organisation’s Doha Round of trade talks is detrimental to the interests of African countries.
The push to conclude the round should not be at the expense of an equitable outcome.
Developing countries have resisted conclusion of the Doha Round of World Trade Organisation (WTO) talks, arguing that developed countries are unwilling to meaningfully alter trade-distorting subsidies while still insisting on binding tariff cuts that will undermine poorer countries' ability to protect agricultural producers and nascent industries. Trade taxes, an important source of revenue for African countries, will also be lost.
The Africa Trade Network and the Trade Strategy Group arranged the discussion as part of a seminar of the present status of the Doha Round in Cape Town on Oct. 1-2. The organisations, which represent civil society groups from South Africa and the rest of the continent, invited activists from across Africa to participate in the two-day seminar.
It was agreed that the Doha Round has lost its original developmental agenda; and that the round is heading towards a conclusion that will compromise African governments' space to make policy decisions, adversely affecting development and job creation.
The South African government is sticking to its negotiating objectives, said Sisa Njikelana, member of the South African parliament’s portfolio committee on trade and industry for the ruling African National Congress. These are to enhance the markets and export interests of developing countries; and to eliminate developed countries' subsidies and inappropriate support to inefficient producers, especially in agriculture.
It also aims to renegotiate the rules that perpetuate imbalances in international trade; and to ensure policy space policy space for developing countries in line with the principle of special and differential treatment, which recognises that the needs of developed and developing countries are different. The WTO allows some degree of discrimination in favour of developing countries, for example raising tariffs when market conditions threaten a sector.
The ANC’s point of departure is that developed countries, which are the biggest subsidisers and the biggest distorters of international agricultural trade to the disadvantage of developing countries, should make 'significant and meaningful' commitments to cut subsidies and open their markets to farm products from the South.
'We insist that developmental interests must prevail over commercial interests and that the principle of less than full reciprocity of reduction commitments be respected,' added Njikelana. The latter refers to WTO member states being obliged to reciprocally open their markets to each others, which African states resist because of their inability to compete at the level of the U.S. and the EU.
While the South African government would appreciate a conclusion to the round, achieving a developmental outcome takes precedence, Njikelana pointed out. 'We are not going to frogmarch ourselves (by) rushing the round.'
He noted that while Doha Round negotiations collapsed in July 2008, pressure towards resuming them and wrapping up a deal has been building at various multilateral meetings over the past year. This pressure is based on a view that finishing the talks would help reverse the decline in global trade; contribute to global economic growth; and restrain countries from resorting to protectionist measures.
But, added Njikelana, this argument has 'of course been taken with a pinch of salt, given the unsavoury track record of developed countries' when it comes to protectionism.
One reason for the renewed impetus is, according to him, that 'some WTO members have assessed that they will gain more from accessing global markets (through the Doha Round) than through opening their own markets... (Their strategy) is a very dicey move.'
Njikelana also argued that the WTO Secretariat and WTO director general Pascal Lamy 'are keen to secure an outcome to regain lost credibility' after the round has dragged on for seven years. For this reason Lamy has exerted pressure for the round to be finalised before the middle of 2010.
Njikelana pooh-poohed Lamy’s recent assertion that 80 percent of the issues being negotiated has been dealt with, saying, 'what if the remaining 20 percent is actually the most crucial and pivotal to the success or failure of the round?'
South Africa's view, which 'may be shared by many developing countries, is that the development round is giving way to the mercantilist market access objectives of industrial countries', which will lead to an imbalanced outcome. Mercantilism refers to a protectionist stance in which states pursue national objectives aggressively without much regard to international cooperation.
In Njikelana's opinion, 'only those who do not share the vision of a new world would be insisting on rushing the conclusion at the expense of fair and equitable global trade in future'.
Angelica Katuruza, who is a director in Zimbabwe's ministry of regional integration and international cooperation, agreed with Njikelana that for most African countries, the Doha Round does not translate into real benefits.
Also in agreement was Tengo Tengela, researcher at the National Union of Metal Workers of South Africa (NUMSA), who argued that the current trajectory of the Doha talks will leave African, including the South African, economies mired in the same structural conditions as before, namely as mere exporters of commodities.
Njikelana added that the proposed tariff cuts would have a harsh effect on South Africa by 'severely reducing our scope to achieve industrial policy objectives and by exposing labour intensive industries to competition'.
Tengela described the talks on industrial tariffs, known as non-agricultural market access (NAMA), as a 'tool to de-industrialise South Africa' that will undermine the economy's productive base and the policy space that the country 'has and should be entitled to as a sovereign state'.
The global economic crisis presents an opportunity to fashion an alternative economic model for the world but 'NAMA is derailing our attempts to fashion this alternative model,' he continued.
Njikelana explained that South Africa will only undertake tariff cuts that are proportional to others and which will not undermine its industrial and employment objectives.
Katuruza differed from Njikelana on whether the removal of Northern countries' subsidies would benefit the South. She drew attention to the fact that African agriculture is dominated by subsistence farmers who would not have the capacity to exploit newly-opened markets in the North.
Another reason is that the prices of the commodities African countries export commodities are determined in the North, said Katuruza.
© Inter Press Service (2009) — All Rights Reserved. Original source: Inter Press Service