WTO: Poor Nations Knocked Out in Sixth Round

- Srilata Swaminathan

The rulers of the world heaved a huge collective sigh of relief as the suspense ended with the finalised draft of the sixth Ministerial conference of the WTO being accepted through a ‘consensus’ at the very last minute. Now that in itself is a pointer for what is in store for the peoples of the world. If the ‘haves’ are happy – and the G8, Kamal Nath, CCI et al certainly are – then it is sure to be bad news for us ‘have-nots’!

What was the week in Hong Kong all about? Now that the dust is settling, let’s examine what actually happened at the WTO Ministerial. The three crucial negotiating areas in Hong Kong were, services (GATS), non-agricultural market access (NAMA), and agriculture (AMA), the third world nations have had to defend their markets from aggressive efforts to further liberalize them while the developed countries led by the US and EU were hell-bent on prying open as much as they could!

The ‘haves’ are satisfied that WTO ministerial is back on track and that a draft has been passed as this means they can ‘legally’, in the name of free trade, continue their market fundamentalism which some economists argue is the worst form of terrorism. Through all the verbiage and gobbledygook of the draft one thing is evident. That no matter what has been written, the rich nations and corporates are now, through Free Trade, completely free to continue their exploitation of the world’s markets, countries, peoples and environment. Because WTO ensures that it is totally binding on all the countries who have signed the dotted line. Once signed, then not even a change in your country’s government can change it. Imperialist Might shall prevail!

Will the problems of our peasants and millions in the agricultural sector be solved? Will farmers be freed from an ever-escalating spiral of debt where the only way out is suicide? Will the marginalised be allowed to get a foothold in landownership? Will the thousands upon thousands of tea-pickers, cotton growers, field labour be allowed to get a minimum wage in order to eke out some sort of existence? Will our factories stop closing and our workers stop being retrenched? Will prices come down? Will our PSUs, education and health not be privatised? No, no, no, no, NO! Then what is this ‘success’ of the WTO that Kamal Nath is crowing about? Take agriculture. Provisions on Special Safeguard Mechanism and Special Products cannot compensate what we have lost through the lifting of Quantitative Restrictions. Also, all our agriculture tariffs are bound and the result of impending tariff cuts will further endanger the already precarious survival of our small and marginal peasants Even the most rabid supporters of WTO acknowledge that the gains to poor countries in this sixth round of talks is ‘extremely modest’ and ‘pitiful’. The losses, however, are immense. Shining India is of course happy that present agricultural policies will continue with outright marginalisation and displacement of poor peasants and labour, that they can proceed apace with the corporatisation of agriculture, encourage a few MNCs to corner the whole agricultural market from production inputs to distribution so that a handful of the world’s (and India’s) rich can get richer at the cost of the rest of the world.

The myth that without WTO there can be no world trade, no progress, no development is outright rubbish as world trade developed eighty-six times between 1948 and 1997 from $124 billion to $10,772 billion under the old trade agreements. No, what is happening under WTO is not about fair trade or development it is about neo-imperialist exploitation of the world under the euphemism of globalisation! It is anti-development (except for the further development of the small percent of stinking rich), it is anti-people and it is anti our ecology/environment and totally unsustainable!

This sixth round, erroneously called the Development Round launched in Doha in 2001 has ended with it being manipulated by the US and EU to further trade liberalisation in the developing countries while they continue to protect their own econonies through high subsidies and non-tariff barriers. The two seasoned warriors of the Uruguay Rounds, S.P.Shukla and Roberto Ricupera, who have long seen the writing on the wall had warned us that far from helping the poor nations to develop it will increase the asymmetries of the global trading system and seems to be a recipe for another catastrophe for the developing world. They recommended that the best thing that could happen to the people of the world was to have another failed round of talks in Hong Kong . Alas, that did not happen.

Look at the strength of the various delegations to Hong Kong . The US had a delegation of over 300 including herds of lawyers and consultants. The EU had over 200 delegates while 46 of the poorest countries were unable to send even one delegate. Pascal Lamy, the wily new DG of WTO and previous commissioner of the EU was determined that this round would not go the way of Seattle and Cancun . He hedged all his bets, even officially co-opting over 2000 NGOs (not that they need much persuasion!) to participate in the main hall of the Conference!

India, (and Brazil) played its usual double-game of posing as saviours of the poor nations while sucking up to the rich and played an important role ensuring that a ‘consensus’ was reached. They sided with the US and EU on crucial voting that effectively scuttled the alternate draft of the G90, allowed the controversial Annex C to be passed which will forcibly open up the service areas of poor nations, hand over vital sectors such as water, energy, telecommunications, finance, education and health to MNCs in 2006. This Annex is full of lacunae and has introduced a new set of extremely opaque rules in the middle of the game. The poor countries are left exposed and vulnerable as they have not been able to prepare Emergency Safeguard Mechanisms, Subsidies and Domestic regulations and nobody can predict what further disastrous repercussions will occur. Furthermore, India is hoping that its loyalty to the US will get its HV1 visa quota raised. This will benefit a small percentage of elite professionals from the upper classes only but has sold out completely on Mode 4 which deals with free movement of labour!

On the great victory of getting a cut-off date for the developed countries to reduce their agricultural subsidies around which we witnessed many days of drama, sparring and outright nastiness between the US and EU representatives – Portman and Peter Mandelson – let’s see what it really is. The US and EU give domestic and export subsidies to their farmers (between 2 to 3 percent of their total populations!) which goes into billions of dollars and is effectively undercutting world agricultural prices in the third world, ruining our farmers and is completely unethical (if ethics can be expected in world extortion!) and totally trade distorting. What they have agreed to is to reduce only their export subsidies by the end by 2013. But these export subsidies are only about 3.5% of the total subsidies they pay to their farmers. So what’s the big deal? How does it save the cotton farmers in Africa or farmers anywhere? The US/EU can also delay cutting subsidies on a number of excuses and also have plenty of time to start switching subsidies from one box to another so that not only may no reductions happen but subsidies to their farmers may even increase!

We had very few illusions about WTO’s latest sparring match and knew that it would be a just a further opportunity for imperialist countries to continue prying open the rest of the world for their expansionist agenda. We knew that it would be difficult for governments of developing and less developed to stand up to them not just because of their weaker position but because of the class interests, corruption and treachery of their rulers. The US , by the way, was very pleased with the way India and Brazil helped them in many instances at the cost of their own people and the people of other third world countries. The cotton growers of Benin , Burkina Faso , Chad and Mali , must love us!

For those of us watching the drama in Hong Kong unfold through TV and the media, it was mega entertainment – suspense throughout, intrigues, lies, greed, rebellion, betrayal, cloak-and-dagger manoeuvring, behind-the-scenes manipulation, sabre rattling, arm-twisting, abusive exchanges, the fat cats, evil bosses, bad guys and good guys, police brutality, and with a cast of thousands of protesting, suffering humanity! Was the whole thing stage-managed? Whatever. The outcome is clear. The bad guys won!

References :

1. Up-Dates and Press Release of Indian People’s Campaign Against WTO.

2. Arun Goyal, Academy of Business Studies

3. Third World News and Features.

4. Developing country prospects at the Hong Kong WTO Ministerial and Beyond by Walden Bello.