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Contributions from
the Column
Monitor
Hong Kong: near failure
Strengthened individual, weakened state
Budget crisis averted
Fewer landmine victims
Health services:
passing by the poor
NGOs claim Iraq
is selling oil reserves
More people infected with HIV
French NGOs take stock
of government action
Millennium Goal still a long way off
01/2006
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[ WTO ]
Hong Kong: near failure
The WTO ministerial conference in Hong Kong in December neither resulted in success nor in a spectacular failure as in Cancún in 2003. 149 member countries managed to reach agreement on symbolically important issues such as phasing out export subsidies of rich countries. They thus averted the impression of not achieving anything at all. Decisions on important matters such as reducing tariffs on agricultural and manufactured goods as well as on trade in services were postponed. WTO members were asked to make new proposals on these issues by the end of April.
The major conference results are:
– Industrialised nations have committed to phasing out all export subsidies for agricultural goods in 2013. Many developing countries as well as the USA wanted 2010 to be the deadline. EU Commissioners Peter Mandelson (trade) and Mariann Fischer Boel (agriculture) proposed 2013, however, after the EU summit in Brussels had passed the budget for the years 2007 to 2013. Even though export subsidies are particularly controversial, they are not the most import form of domestic farm support. According to Oxfam, an international charity, they only amount to 3.5% of European farm subsidies. Other forms of governmental support, however, were not on the agenda in Hong Kong. The USA agreed to talks on food aid. Europeans consider Washington’s approach to this kind of assistance a covert form of subsidising exports.
– By the end of 2006, rich countries have to abolish all export subsidies for cotton. This decision is aimed at the USA. The US delegation reached the compromise in negotiations with four African export countries, Benin, Burkina Faso, Mali and Chad. However, a WTO dispute settlement had already ordered the USA ahead of the ministerial meeting to stop subsidising cotton exports. As is true of farm support in general, export subsidies only make up a small share of US cotton support: less than ten percent.
– In 2008 at the latest, the prosperous countries have promised to grant duty- and quota-free access to their markets to 97% of the products from the 50 least developed countries. That pledge meant no compromise for the EU, as it already grants such access to almost all products from these countries in the context of its “Everything but arms” initiative. The USA, so far, have granted 83% of least developed countries’ goods such access. The figure for Japan is 87%. The USA opposed a total relaxation of barriers in order to stay able to stem textiles imports from Bangladesh and Cambodia – two countries that depend on their textile industries and are now, according to experts, being punished for having adapted well to global liberalisation.
– An important decision in Hong Kong was to adopt the „Swiss Formula“ for future tariff reductions for non-agricultural products. Accordingly, high tariffs will have to be reduced at a higher rate than low tariffs. This measure will affect developing countries in particular. The details on how exactly tariffs are to be reduced, however, have not been decided on yet.
– The industrialised countries prevailed not only keeping trade in services on the agenda, but even succeeded in speeding up negotiations. Many developing countries had opposed the approach in general. According to the New York Times, the delegations from Cuba and Venezuela, minutes before the conference ended, declared that they might refuse to participate in liberalisation in this field.
After the meeting, NGO representatives complained that the rich world had once again dominated proceedings. Nonetheless, some participants from major developing countries such as India and Brazil said they were quite content. It became clear in Hong Kong that there is no such thing as a uniform position of developing countries on trade. Even opening borders to the poorest countries met with criticism. Government spokespersons from Africa, the Caribbean and Pacific (ACP) complained that their countries were losing out because they will no longer benefit from the preferential EU treatment that they have enjoyed as former colonies. On the other hand, some Central American governments, which do not belong to the poorest countries, expressed the fear that countries like Senegal or Angola might now eat into their share of international banana exports.
In Hong Kong, developing countries for the first time formed the G110 to represent their interests together. Michael Frein of Germany’s Church Development Service, a Protestant Agency, considered that step a sign of growing awareness among poor countries that they can only “prevail against the North together”. Heike Löschmann of Heinrich-Böll-Stiftung, on the other hand, said that emerging markets as India and Brazil had only joined the alliance for tactical reasons. (ell)
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