CSOs voice concerns over the TFA/food security issue

Ahead of the 27 November WTO General Council meeting, civil society groups had expressed concern that the deal on the table would not adequately serve developing-country interests.

by Kanaga Raja

GENEVA: On the eve of the General Council meeting on 27 November, some 116 civil society organizations (CSOs) across the globe voiced their deep concern over the process and content of what was being negotiated on the peace clause with respect to food security and on the Trade Facilitation Agreement.

These concerns were voiced in a letter dated 24 November to the WTO members. The letter appeared to have been released just before the draft decisions on the Protocol of Amendment for the TFA and on public stockholding for food security purposes were handed out to the members on the same day.

In a separate letter sent to Indian Commerce and Industry Minister Nirmala Sitharaman on 25 November, Indian farmers’ organizations and other civil society groups in the country raised serious concerns over the India-US agreement on the TFA/food security issue (see below).

The draft WTO decisions were drawn up following an official announcement by the United States and India on 13 November that both governments had reached an agreement aimed at breaking the current deadlock on the TFA/food security issue (see TWE No. 580). Unlike at Bali, the two governments had negotiated directly, bypassing the WTO Director-General.

Unfair and unbalanced

In their letter to the WTO members, the CSOs underlined that the Bali package was a highly unfair and unbalanced agreement in the first place. It included a permanent Trade Facilitation Agreement that was extracted by the developed countries while including only best-endeavour clauses on the development package for least-developed countries.

In addition, said the letter, the Bali package included only a “temporary” peace clause on the G33 proposal on food security, which was further weighed down by stringent conditionalities.

“The G33 proposal was a genuine demand by a number of developing countries, led by India, to change the WTO rules to allow domestic subsidies to producers in developing countries and LDCs for public food stockholding programmes to be given without limit.”

Among the international and regional organizations which signed on to the letter were LDC Watch; the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF); South Asia Alliance for Poverty Eradication (SAAPE); the Pacific Network on Globalisation (PANG); Third World Network (TWN); Third World Network-Africa; and the ACP Civil Society Forum.

The letter was also signed by a host of national organizations encompassing consumer groups, environmental groups, trade unions, farmers’ groups and women’s organizations.

The CSOs said that the current WTO rules have been identified by the UN Special Rapporteur on the right to food as a barrier to global food security.

“Given the impacts of global climate change, food price speculation, and rich country subsidies, it is immoral that developing countries and LDCs are still prevented by WTO rules from investing in domestic smallholder production, which has been repeatedly identified as one of the most important globally-agreed poverty-reduction strategies,” said the letter.

According to the groups, this shows the importance of changing the WTO rules to allow these public food stockholding programmes for the food security of developing countries and LDCs and how essential these subsidies are for supporting food production, procurement as well as for farmers’ livelihoods.

The CSO letter drew attention to media reports citing the United States and India as having reached a deal on public stockholding for food security purposes, and that the text of the deal would only be released on 24 November and countries would be required to decide on it two days later, on 26 November. (The special General Council meeting to adopt the decisions was subsequently postponed from 26 to 27 November.)

The CSOs stressed that this process was too rushed for such a vitally important issue and was extremely non-transparent.

“A deal reached between two countries does not mean that it suits all other countries. There should be a proper process to include the views of all other WTO member countries after having given them long enough to carefully and thoroughly consider all the implications for current and future programmes of the deal reached between the US and India,” they said.

The CSOs further emphasized that for it to be adequate for food security, the text of the US-India deal must contain the following provisions:

l     “An unambiguous statement that the peace clause lasts until there is a permanent solution.

l “That any peace clause applies to existing as well as new programmes. The Bali Ministerial Conference Public Stockholding for Food Security Purposes Decision is grossly inadequate because it only applies to programmes existing as of 7 December 2013. This unnecessary restriction punishes those who did not have programmes in place at the time they were asked to rapidly agree to this Decision. Many other developing countries and LDCs may want to have these programmes in future, for example, when the global financial crisis is over and so they are able to afford them. It is very unfair that the Decision does not allow them to start these programmes by using the peace clause in the future.

l “None of the onerous and inappropriate conditions on the peace clause that were in the Bali Decision, including those identified in our previous letter of 20 November 2013, which was endorsed by more than 230 civil society groups globally.

l “A requirement that the permanent solution should be quickly agreed with a satisfactory permanent solution by June 2015. From our perspective, the permanent solution must allow subsidies to producers for supporting public food programmes as part of the Green Box that can be used by developing countries and LDCs without conditions and without limits. This is important because the current system of calculating subsidies based on 1986-88 reference prices would make almost any government purchase from farmers at today’s price a violation of WTO rules by wrongly magnifying the subsidy. Therefore, the permanent solution must also correct the outdated reference price date and base the calculation of subsidies on current global prices.”

The CSOs urged the WTO members to ensure that developing countries’ and LDCs’ interests were not sacrificed in the negotiations and at the special General Council meeting on 26 November in order to clear the path for the TFA.

“Crucial development issues in developing countries and LDCs such as food security and farmers’ livelihoods must be addressed to their satisfaction if the Doha Development Agenda is to truly be a development round of negotiations at the WTO. A peace clause and committed accelerated work programme on a permanent solution as outlined above needs to be agreed,” the CSOs said.

Worrisome conditions

Meanwhile, in a 25 November letter to Indian Commerce and Industry Minister Nirmala Sitharaman, Indian farmers’ organizations and other civil society groups noted that from newspaper reports, it was evident that India had reached an understanding with the US which would ensure US support for the Indian proposal to be tabled at the General Council meeting.

This revised proposal would ensure that the peace clause related to the G33 food security proposal will actually be in operation until a permanent solution is found, said the groups. They believed that the proposal would also include an institutional framework for discussion on the post-Bali work programme.

“These two gains are useful and could be of value for Indian agriculture, food security and farmers’ livelihoods,” the groups said

However, they were worried about the heavy conditions imposed on the use of the peace clause. These included the very onerous data filing requirements, and the need to prove that the subsidies are “non-trade-distorting” and do not affect the food security of other countries.

The data filing requirements are worrisome, the groups said, especially since the US, Japan and the EU are already questioning the reliability of subsidy statistics provided by India at the WTO, and asking why big farmers have been included in the producers’ category and why the statistics were given in US dollars and not rupees.

The letter to the Indian minister was signed by a number of farmers’ organizations including Bhartiya Kissan Union, the Indian Coordination Committee of Farmers’ Movement, Bhartiya Kissan Union-Punjab, Tamilnadu Farmers’ Association, Kerala Coconut Farmers’ Association, Tamilnadu Organic Farmers’ Federation and Kalanjium Women Farmers’ Association.

Among the other civil society groups which endorsed the letter were the Alliance for Sustainable & Holistic Agriculture (ASHA), Third World Network-India, ActionAid-India, Focus on the Global South-India, Indian Social Action Forum, ToxicsWatch Alliance, Campaign for Affordable Trastuzumab, International Federation of Organic Agriculture Movement, South Asian Network for Social & Agricultural Development, Initiative for Health & Equity in Society and Diverse Women for Diversity.

In their letter, the groups noted that the peace clause does not cover the Agreement on Subsidies and Countervailing Measures.

“We are also seriously concerned that the current peace clause is limited to ‘existing programmes’ and fear that this will affect India’s ability to expand its current food programmes and potentially restrain its sovereign policy space to come up with new ones, if need be.”

The letter noted that civil society groups had pointed out these concerns with respect to the stringent conditions attached to the use of the peace clause before, during and after the Bali Ministerial Conference.

“We strongly urge the government not to table this proposal without discussing and easing these restrictions. Unless these are addressed, India may not actually be able to use the peace clause at all. India should not be in a haste to sign the TFA without having ensured a fully usable and meaningful peace clause,” said the groups.

While appreciating that the Indian government had taken steps to move forward talks on the permanent solution through the setting up of an institutional mechanism, the groups urged the government to seriously pursue a genuine permanent solution “that does not just talk about the reference price but actually uses this opportunity to address the historical inequities in the [WTO] Agreement on Agriculture (AoA) and the unfair subsidies given by the developed countries who are now pointing fingers at us.”

The groups were also seriously concerned about India’s agreement to ratify the Trade Facilitation Agreement. They argued that the TFA needs to be rejected not only as a strategy but on its own lack of merit.

“It imposes costs rather than benefits on us. It can lead to moving resources away from essential development expenditure whereas our industry is hardly ready to reap the benefits of the Agreement at least in the near to medium future. Given that the TFA is currently the main and perhaps the only interest for countries such as the USA in WTO negotiations, agreeing to the TFA now will also be a strategic blunder. Future negotiating positions on development issues in the Doha Round will be weakened and compromised.”

The letter further said: “We are also aware that if this issue is resolved, we will get into further negotiations on other elements of agriculture, industry (NAMA) and services trade.”

“The developed countries are pushing us to accept liberalization in these areas that will severely threaten job generation, local industrial development especially of SMEs [small and medium-sized enterprises], food and farmers’ livelihood security, access to affordable services, and will severely restrict policy space. The push for plurilaterals is also something we strongly reject. India needs to have very well thought out positions that are developed in consultation with civil society, state government and the Parliament on these issues.”

While the letter noted and agreed that the Indian government was at least trying to take an apparently pro-farmer and pro-poor position at the WTO, it said that this stance was not consistent with its approach in domestic policy or in free trade agreements (FTAs).

In FTAs, the groups asserted, the government is willingly reducing applied duties on agricultural products and allowing increasing intellectual property rights to limit farmers’ access to technology and seeds. FTAs are also bringing in strong investment chapters that are shifting control of productive natural resources away from farmers.

The groups urged the government to come up with a consistent policy stance at global, regional and domestic policy formulations; not accept any unfair and unreasonable conditions on the peace clause at the WTO; pursue a meaningful permanent solution that actually attempts to redress the historical unfairness of the AoA; and seriously analyze the usefulness of the TFA for the Indian people at large.

The government was also urged to initiate a dialogue and discussion with major political parties, farmers’ groups, trade experts and civil society groups to keep them informed about these developments at the WTO and to develop a better understanding and policy response.

It was further urged to introspect about India’s objective and value of being in the WTO and what influence it has on India’s independent policy space, and specifically organize/undertake a 20-year assessment of India’s gains/losses from membership in the WTO. (SUNS7924)                                         

Third World Economics, Issue No. 582, 1-15 Dec 2014, pp5-7