NGOs call for rejection of Harbinson paper

Geneva, 24 Feb (TWN/Goh Chien Yen) - Over 50 non-governmental organizations (church and development groups) from around the world have called for the rejection of the latest Agriculture Draft modalities paper presented to the Special Sessions of the WTO Committee on Agriculture by Chairman Stuart Harbinson.

The NGOs said that the Harbinson draft of a modalities for commitments ignored promises made at the last WTO Ministerial to place “development, food security and rural livelihoods at the heart” of the negotiations.

The NGOs issued a joint statement, after three days of meetings last week in Geneva. In the statement they criticized the draft among other reasons: for not changing the underlying structure of agriculture trade rules which made the playing field “highly uneven and distorted” against the developing countries; legalizing dumping by the rich countries while, at the same time, eroding the only defences of against dumping, tariffs and other border measures; for ignoring the increasing stranglehold exerted on agricultural trade by a small number of TNCs, which in turn depressed farmgate prices around the world.

One clear reason for distortions, the NGOs said, is the high level of export subsidies and domestic support used by the EU which has displayed little resolve in ending their subsidies.

During the meeting, Tim Rice from Action Aid, had pointed out that the recent EU proposal to the WTO, offering to reduce its aggregate measure of support by 55% from its final commitment in the Uruguay Round (UR), would in effect not commit the EU to do anything in a new round that it was not already doing. Similarly, the EU proposal to reduce the value of export subsidies by 45% from its final bound commitment in the UR would not commit the EU to anything in a new round that it is not already doing.

Jesus Zorrilla, EC trade negotiator who was at the meeting, admitted that the EU has already achieved the reductions in the aggregate measure of support and export subsidies offered in the EC’s recent proposal on modalities for agricultural products. He explained this by arguing that the EU had done so “in order to get credit” for it at the WTO.

Speaking at the NGO meeting, an international trade expert, Mr.Bhagirath Lal Das, said there are many inadequacies and inequities in the current AoA and the Harbinson modalities draft followed the same pattern of imbalance. Das said that when a chairman’s text is put forward in any international negotiation, this became the basis of the negotiations.

While negotiators might react to the Chair’s text, they would be doing so within the broad framework established by it. Hence, the Chair had a great responsibility to capture all the views of all the negotiators. However, the tenor of the discussions that have been taking place, were not reflected in the Harbinson text. A chair “is not empowered to say what he pleases, but is only authorized to produce a text which is faithful to the negotiations.”

The first draft modalities paper of the chairman’s text was prepared and rushed to the Tokyo ‘mini-ministerial’ meeting, but with wide divergence of views there on the validity of the text. According to media reports, the ministers at Tokyo were not prepared to use it as the basis for the negotiations.

It was apparently rejected because it did not capture the concerns of many countries, especially those of developing countries. This, Das said, had dealt a big blow to the Chairman’s text and this should be taken note of.

Das argued that the response and relief did in members commenting on the text, but rather in a total change to the structure and approach of text. Since 1995, when the AoA was implemented, the many inadequacies and inequities of the agreement have become more apparent. But the Harbinson text followed the same pattern of imbalance, though there were some small positive features in the text which could be made use of. The introduction of a ‘a strategic product category’ was important though the treatment to it was “far from adequate.”

The text also recognised the problem of food security and the plight of small farmers in developing countries, but again the treatment was inadequate.

The UR agreement on agriculture treated the three pillars of market access, export and domestic subsidies separately, and the Harbinson text followed the same structure, and this would perpetuate the inadequacies in the AoA. The AoA allows anyone, especially developed countries to give huge subsidies, and only they could take advantage of it, thus totally distorting the sector.

Though many developing countries have highlighted these problems countless times in the WTO, the chairman’s text ignored these.

It was hence necessary to restore the balance in the AoA, and correct past mistakes and iniquities. Only then special and differential treatment to developing countries could be meaningfully extended. The Harbinson draft did not talk about restoring balance at all. This was a priority and done and automatically without making it appear as a favour to developing countries. In restoring balance, subsidies must be removed, especially export subsidies, and removed immediately by all OECD countries, Das argued.

The rules and disciplines on domestic support, enable mechanisms for developed countries to use to elude discipline. The classification between trade distorting and non-trade distorting measures and correspondingly reducible and non-reducible subsidies “is a fraudulent one,” Das said.

By allowing the ‘green box’ subsidies to continue, the OECD countries can escape any discipline. These subsides should be brought under reduction discipline and towards elimination.

On food security, the Harbinson text talked only of using tariffs and subsidies.  The last option was effectively closed to the developing countries and tariff itself may not offer quick and effective protection. The general solutions of anti-dumping measures and countervailing measures were impractical for developing countries, because of the need to demonstrate ‘injury to domestic production’. Even a genuine claim can be easily challenged and be very costly to defend in financial terms. Ironically, the special safeguard provision has been framed in such a way that only developed countries could effectively employ them. The developing countries should be able to use special safeguards should be allowed for developing countries for all agricultural products.

Given the basic imbalances in the Harbinson text, Das advised developing countries to prepare their own alternative text and table it, rather than comment on the current one.

Some of the developing country delegates who were present echoed the comments of Mr. Das.

The delegates from Brazil, Barbados, the Philippines and India made clear that many developing countries, including themselves were disappointed and unhappy with the Chairman’s text.

This is because, “On a careful review it is doubtful whether the proposed modalities will bring about substantive balance”, said Maria Fe Alberto, the Filipino delegate. The proposed modalities would act disproportionately against the tariff structures of developing countries, forcing deeper liberalization on them.

She added, “Philippines is disappointed. The Filipino proposal to correct the iniquities in the agreement has not been captured by this draft text. The proposal attempts to deal with the three pillars of market access, export subsidies and domestic support and their interlinkages which the Chairman’s text ignores.” She also warned that this text sent a negative political signal by the developed countries that trade-distorting subsides cannot be eliminated by this round.

Nicole Clarke, trade negotiator from Barbados pointed out that developing countries such as Barbados do not provide export subsidies and domestic subsidies beyond the de minimis level. Developing countries such as Barbados were disappointed with the lack of ambition in disciplining subsidies and the lack of flexibility in the pace and pattern of agricultural trade liberalization for developing countries. The common stand of all developing countries, Clarke said, is for greater liberalisation of agricultural trade in the developed countries and more balance to the AoA.

The Brazilian WTO negotiator, Flavio Damico argued that the WTO is titled against developing countries, especially the rules governing dumping in the AoA which is something that must be addressed. However, the real issue was not whether this round can be a so-called development round, but rather “the larger problem of how to mainstream development into the WTO”. – SUNS5291

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