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French Food
and Agriculture Organization Chief Jacques Douf did not support
reduction in agricultural subsidies and to accelerate the process of
access to US/EU markets. He rather has pressed for similar subsidies
for farmers in Africa, Asia and Latin America. He made remarks in
interview on Friday April, 2008. Mr. Douf further stated that there
are two solutions: end subsidies everywhere or give them to every
one, I prefer the latter. Earlier, French President Nicholas Sarkozy
in his inauguration speech to the Paris annual Farm show, on 22
February, 2008 had claimed that EU makes too many concessions in WTO talks. Therefore
emerging countries should show more good will. He had warned to
oppose any agreement that would sacrifice the French and EU
agricultural interests.
France is the
single biggest beneficiary of the EU’s farm subsidies, worth more
than 40 billion Euros a year in total. Doha Development Round was
launched in November 2001, to boost the world economy and help
developing countries including Pakistan to lift them out of poverty
by exporting more. The multilateral talks are being foundered ever
since the dispute between developing and industrialized nations.
Repetition of Seattle (USA) fiasco held in November 1999 is
continued despite one sided mantra of prosperity after liberation of
global economy.
The North-South dialogue between rich and poor countries was aimed
to facilitate new economic order. Gap between them could grow even
wider over the next decades if the rich nations failed to show any
flexibility. In Pakistan’s perspective, the problem has been
complicated by
US
rejection of Islamabad plea for liberal textile quotas. Then US
Assistant Commerce Secretary William Lash during visit to Islamabad
on August 12, 2003 had suggested that Pakistan should prepare for
the long term challenges of a quota free world. Pakistan wants more
liberal quotas to the US. Pakistani textiles are not allowed freely
owing to (i) domestic textile interests and (ii) balance of trade in
favor of
Pakistan.
Under WTO regime the textile quotas imposed under the old Multi
Fibers Agreement were done away with in January 2005. The rich
countries can, however, restrict certain categories until 2013 and
thus many of MFA quotas are still in force. It prevented Pakistani
textile exports to USA and EU. It has contributed to a further
widening of Pakistan’s trade gap. The trade gap is increasing
pressure on country’s balance of payments. The foreign reserves
declined from 16.5 billion to 13.5 billion.
It is observed that any deal that involved rich countries to open up
their food markets and slash subsidies is opposed by USA and EU, in
return for developing countries cutting their industrial tariffs.
Main reason is the reluctance of the developed world to assist
developing countries rather pressing the latter to shoulder the
obligations. The US Trade Representative and current President World
Bank Robert Zoellick had warned during Cancun (Mexico) Ministerial
Conference (September 2003) that the US would go alone by seeking
one-on-one deals if the WTO failed to secure an accord by January
2005. While EU officials had said “ we have a long line of people at
our door seeking bilateral trade agreements”. Market access,
domestic support and export competition are the sticking points. In
line with Hong Kong Declaration all states are supposed to ensure
elimination of all forms of export subsidies.
France is known for opposition to any farm concessions in
import tariffs for farm products. It is going to take over EU
Presidency in July this year. It wants revamping of EU’s Common
Agricultural Policy (CAP) before a full overhaul of the policy
scheduled in 2013. Developing countries had welcomed WTO proposals
in Geneva
to reduce barriers to farm trade, presented in February this year.
At the same time they had voiced reservations on those calling for a
further opening of their own markets for industrial goods. Doha
Round calls that developed countries should open up their
agricultural markets to products from developing countries. Rich
countries spend whopping amount of more than US$ 250 billion on
subsidies. WTO proposal calls for an average of 54% reduction in
customs duties leveled on developing countries agricultural exports
by industrialized nations. The Group of 20(G-20) of which
Pakistan
is a founding and active member was formed during Cancun (Mexico)
Ministerial meeting in September 2003, to safeguard their economic
interests.
It is encouraging that in addition to export of agricultural
products, Pakistan industrial goods are branded and of international
standards in compliance with WTO specifications. The Government of
Pakistan is in the process to include socially compliant stationery
industry in the free Trade Agreements, Regional Trade Agreements and
Preferential Trade Agreements signed or going to be signed.
Currently, Pakistan has world class stationery industry which
exports 5.5 million dollars of stationery items annual. The products
are certified by international laboratories.
Imposition of conditionalties on products from developing countries
is not good. In mid-1990s, USA had banned Pakistani competitive
textile products without any rhyme and reasons. On 12 April, 2007,
EU had suspended fish cargoes from Pakistan pleading that the
harbour conditions were not of international standards. A handsome
amount is spent on the import of crates, insulated boxes and up
gradation of two existing market halls. The government has also
announced 75% subsidy for boats up gradation to meet EU conditions.
For the time being Pakistan has virtually lost EU market of 50-60
million dollars per annum. During the period, Pakistan has been able
to export fish products to ME and
Far East but fetched low prices. Consequently, fish export during 2007-08 is
expected up to 150 million dollars compared to 184 million US
dollars in 2006-07.
Pakistan’s main
concerns at WTO are issues of agricultural subsidies, long list of
sensitive products and Trade Related Intellectual Property Rights
(TRIPS) by advanced countries. Food security, livelihood and rural
development are other areas of concern. The idea of various boxes
under WTO are basically aimed at protecting developed North
interests at the expense of developing countries. The complex
jargons of boxes are (i) Green Box-government funded unlimited
subsidies given directly to farmers and must not distort trade; (ii)
Blue Box- exemption from general rules keeping all subsidies within
defined minimal ‘deminimise’ levels and (iii) Amber Box-domestic
support measures distorting production trade must be reduced.
Globalization means faster growth, higher living standards, new
opportunities and compete access to innovative technologies more
information and new knowledge. In
Pakistan
agriculture is the main source of people’s livelihood, income,
employment and goes deep into their culture. Majority of developing
countries spend major chunk on consumer goods. Any change in
agricultural policy means mass socio-economic disorder. While
increase in subsidies by developed states means dumping their
agricultural products in poor countries. If the world wants to have
a non-discriminatory, ruled-based, stable and equitable trading
system, developed world must reduce their domestic subsidies and
encourage the transfer of technology than to provide tied aid.
Ref link:
http://pakobserver.net/200805/23/Articles02.asp |
