Rick Rowden, (PhD research, Centre for Economic Studies and Planning, Jawaharlal Nehru University (JNU) New Delhi) reports that – in a move described in the Financial Times as a ‘victory for the US and EU’- rich countries have dispensed with any pretence that they will fulfil WTO commitments which relate to developmental issues of concern to the world’s poorest countries.
He observes that twenty years after signing the Uruguay round agreements that promised to address the inequities in the global trading system and 14 years after beginning the 2001 Doha Development round of talks aimed at resolving those imbalances, the rich countries have scarcely lifted a finger to get the agreements adopted. The Wall Street Journal amplifies, citing the failure to implement the 2013 Bali deal.
Rowden notes that after urging developing countries to open their markets, rich countries flooded them with subsidised agricultural produce and manufactured goods
The most extreme example is recorded by Simon Jenkins, who notes that though the West urged Afghans to grow food instead of opium poppies, it took no steps to curb its own heroin consumption and even dumped its grain surpluses on the Afghan markets
Rowden continues: “the WTO’s overarching goal of “progressive liberalisation” was inherently wrong-headed for developing countries from the start, given that today’s industrialised countries learned to liberalise trade barriers only once their domestic industries were competitive in world markets, not before”.
He notes that though the Nairobi ministerial will be praised for reducing “export subsidies”, the rich countries still intend to use a range of crop insurance and other insurance schemes, which have the same effect: small farmers in developing countries will still lose out as imports of cheaper, highly subsidised agricultural produce flood in from rich countries.
Rowden says that the current system will make it impossible for small farmers in developing countries (and, we add, their British counterparts) to survive in the countryside and impossible for them to find manufacturing jobs when they migrate into their cities. He points out also that helping to build up a country’s own companies is considered “discriminatory” towards foreign investors and outlawed by the WTO.
Rowden ends: “With such a great development policy, is it any wonder that some of these millions of disillusioned, unemployed youth end up joining the multitudes of economic migrants seeking to enter the US and Europe or, worse, the ranks of Islamic State, Boko Haram and al-Shabaab?”
Timothy A Wise, Global Development and Environment Institute, Tufts University, MA, US disagrees with this assessment – also in the FT: “US Trade Representative Michael Froman’s declaration that the Doha round is effectively over and we can move on to more important issues, is not the majority interpretation coming out of Nairobi. In fact, Kenyan chair Amina Mohamed, in her post-closure press conference, went out of her way to say quite the opposite. She was asked if this meant that the Doha round is over and new issues can be brought on to the agenda. She stated quite clearly that the language of the declaration specifically prioritised “outstanding Doha issues” and that no new issues, such as investment and public procurement, could be taken up unless all WTO members agree.”
Time will tell which account is the most accurate.