The WTO is an important multilateral forum because it attempts to negotiate the future. The unacknowledged purpose of creating the WTO was to perpetuate, through international agreements, the pattern of trade imbalances in the international economy. The ploy is to convene a forum to negotiate an equitable amendment. The tactic is to wear down the resistance with an apparently repetitive immobility. Therefore, the Doha Round, labelled Development Round and intended to phase out farm subsidies - which have increased – is now only about market opening and the word development is totally absent.
The irony of the negotiations is that all countries claim to seek greater market opening, while all of them call for "flexibility" to keep them closed.
Developed countries which benefit most from current imbalances, do not want to give up anything tangible, but keep demanding more market space for their industrial products (NAMA) and their subsidized agricultural exports. This process of asking without giving created an escalation of a technical imbroglio of unmanageable complexity for countries that do not have the backing of an specialized team. The wear on resistance is visible; issues sharply rejected before by developing countries are now in the negotiation texts. The rhetoric of "win-win" deals vanished and there is only left the vulgar ambition to win at the expense of others.
The objectives of the negotiation
There is much rhetoric, but the original and secret aim of the negotiations is to open markets to the international production and marketing of international cartels. The cartels are stateless, but control governments in developed countries, who speak for them; if any one has doubts, take a look at the handling of the financial crisis. The international cartels control is resisted politically in some developing countries, who have their own industries and a large population making their living on agriculture. Such is the case, for example, with nuances, of
Agriculture is essential to political sovereignty, as is well known by those who have suffered or suffer - like
For reasons of geography and abundant labour, tropical and subtropical countries should be the major exporters of agricultural products.
Some countries, like
Divide et Impera
The principle of "divide et impera" (Divide and Conquer) is Roman, but is well practised by Anglo-Saxons and other colonialists. The map of
Developing countries in the WTO have an overwhelming majority and therefore must be divided. The first division occurred outside the WTO, when international cartels achieved all they could ambition through the free trade agreements (FTAs) which the
At WTO, an effective divisive tool is the "Special and Differential Treatment" principle, which is something like "pay me latter". Based on this principle there are arbitrary divisions such as "least developed countries (LDCs)" and "small economies" who are exempt - for now- of giving concessions and therefore of issues to negotiate. When we see that the LDCs are still dependent former colonies and that the concept of small economies was promoted (
There are divisions that arise from the negotiation process. There are five country groups related only to agricultural trade: the Cairns Group, G20, G33, G10 and the ACP [2]. The Cairns Group [3] (efficient agricultural countries) requests removal of all subsidies and open markets. The G-20 calls for the same, with reservations. The G-33, are 45 developing countries that defend (special products and safeguards) vulnerable subsistence sectors, but only 8 are still active, because 37 of them were given the opiate of small economies. The G-10 are industrial countries (sensitive products) that protect their strategic agricultural sectors. The ACP defend their European agricultural preferences from erosion by trade liberalization.
At “Non Agricultural Market Access” NAMA (industrial products), only the group NAMA 11 supports the right to protect its domestic industry. Of the 11, only
Latin America
- Cairns Group:
- G-20:
- G-33:
- Cairns Group and G-20: MERCOSUR and
- G-20 and G-33:
- Cairns Group, G-20 and G-33:
- Small Economies: There we find all of Central America except Costa Rica, all the Caribbean, Ecuador, Paraguay, Bolivia and…
There is obvious absence of negotiation policy when - as
There are some Latin American structures that could be more useful. ALADI is a case, because it benefits from the WTO "enabling clause [4]". GRULAC, has mixed policies, but there are forums where it has a distinct position. At the Codex Alimentarius Commission, GRULAC as Codex Committee of Latin America and
A Latin American group that begins to demonstrate effective coordination is ALBA [5]. A few days ago it imposed a clause affirming the need for consensus [6] to make decisions, when an Indian proposal on reform and transparency of the WTO, contained a dangerous ambiguity over the expression of the multilateral will. In the
Reasons for rejecting the proposed texts.
The WTO has focused on reducing tariffs, open services and protect intellectual property, rather than decreasing economic distortions. This priority aims to maintain and worsen the existing ones. The financial crisis has shown the dangers of rapid liberalization and deregulation, when we see that the most affected countries were those more involved with global financial markets. The crisis also highlighted the vulnerability of countries dependent on the world market for basic needs, such as food.
The leaders of the G20 meeting in
It seems that the WTO Director, Pascal Lamy, is not aware of it, but many governments believe that a general crisis, of uncertain duration, is not the best time to give up basic instruments of economic policy. The most recalcitrant in the negotiations have been, indeed, the big developed players. It is absurd to seek multilateral static deals while global dynamics suggest major international changes.
Developing countries in control of their national policies, have a valid growth option on regional and domestic development, while watching for the geopolitical shift that will make international trade a more equitable exchange and paid for with a more solid currency.
Notes
1. Uruguay is a curious case. It did not declare independence from Spain like other Spanish American countries. It declared independence from Brazil, who invaded it en 1816 when it was ruled by the Portuguese Crown Prince.
2. African, Caribbean and Pacific former European colonies, it includes Cuba and Dominican Republic
3. Argentina, Australia, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Philippines, Guatemala, Indonesia, Malaysia, México, New Zealand, Thailand, it was a total of 16. Pakistan adhered recently.
4. GATT Decision of 28/11/1979 (doc. GATT L/4903), that exempts from compensation any tariff preferential treatment given among members countries in development.
5. ALBA is a group of developing whose members are Venezuela, Bolivia, Ecuador, Nicaragua, Cuba, Dominica, Saint Vincent and the Grenadines, Antigua & Barbuda and Honduras.
6. It means there is no opposition. It is a fundamental rule for respect of sovereign will over coalitions of countries. Opposition must be formal, because at WTO silence is taken for approval. Consensus means that one single vote against can stop approval.
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