About the Book
This paper describes two of the world’s most urgent (and interconnected) problems – the global commodities crisis and the distorting nature of global agriculture trade. The decline in commodity prices and the falling share of developing countries in the commodities trade have been responsible for massive transfers of financial resources from poor to rich countries. The high level of agriculture subsidies of rich countries has also adversely affected the developing countries’ agricultural sector.
This paper outlines recent developments regarding these two issues, including at the United Nations and the World Trade Organisation (WTO).
Suggestions are also made to resolve the two problems of commodities and agriculture trade. They include, once again placing high global priority on seeking solutions to the commodities crisis; reviewing the global framework which influences agricultural trade as well as developing countries’ agriculture; addressing the issues of Northern subsidies and import liberalisation in the South in WTO negotiations; and reviewing the trade conditionalities linked to the loans of the international financial institutions.
About the Author
Martin Khor is the Director of the Third World Network. He is an economist trained in Cambridge University and has authored several books and articles on trade, development and environment issues.
1 General Background and Rationale for Dealing with the Issues
Global agriculture trade
2 The Developing Countries’ Commodities Problem
Illustration: The case of coffee
3 Global Agriculture Trade and Continued Protection in Developed Countries
Continuation of protection in developed countries
Effects of Northern subsidies and protection
The case of cotton subsidies
Lack of capacity of developing countries
4 Effects of Import Liberalisation on Developing Countries
5 The Global Framework Regulating Agriculture Trade
6 Previous and Recent Efforts to Improve the Commodities Situation
Previous attempts to deal with commodities
UN Eminent Persons’ Report on Commodities (October 2003)
Establishment of international task force on commodities at UNCTAD XI (June 2004)
7 Suggestions for Measures and Action
Placing high global priority on seeking solutions to the commodities crisis
Reviewing the global framework which influences agricultural trade as well as developing countries’ agriculture
Addressing the issues of Northern subsidies and import liberalization in the South in WTO negotiations
Reviewing the trade conditionalities linked to the loans of the international financial institutions
Improving supply capacity in developing countries