GENEVA - One thing is clear
from the negotiations at the World Trade Organization
(WTO) headquarters: developing countries want more
substantial liberalization in agricultural trade than
proved possible in the Uruguay Round of the General
Agreement on Tariffs and Trade (GATT) at Marrakesh
And these nations are not
expected to settle for concessions by the industrialized
world on traditional products with scant added value,
as occurred seven years ago. What they want is global
In the current WTO negotiating
process on the deepening of liberalization in agriculture
and services, underway since January 2000, the relevant
discussion involves concessions on 'temperate' products
that are efficiently produced by developing countries.
Thus far the North has
granted preferential treatment for tropical products
that is doesn't produce while maintaining protectionist
barriers against temperate products that it does.
Agriculture plays a far
greater role in the economic growth of developing
countries than it does in the industrialized world.
It accounts for a far higher percentage of export
income in developing countries than in industrialized
ones - 15 percent in Africa, and 20 percent in Latin
America as opposed to 0.1 percent in Japan and 4.9
percent in the United States.
Moreover, in many developing
countries agriculture employs more than half of the
labor force, as opposed to relatively small and declining
shares in OECD (Organization for Economic Cooperation
and Development) countries, where it ranged from 2.7
percent (in the US) and 12.2 percent (Korea) in 1999.
It is this reality that
for decades has driven developing countries' persistent
demands for more access to world markets for their
agricultural exports and more equitable conditions
of competition, particularly in regard to export subsidies
that the North uses to protect its own agricultural
Import markets in industrialized
countries will, of course, not be the only ones in
the firing line. The markets of developing countries,
and of transition economies, have and will continue
to become increasingly important outlets for their
own products. Indeed, they are almost as important
as those of the industrialized countries, now accounting
for around 40 percent of developing countries' agricultural
Of course, developing countries
are concerned about the impact of predatory and subsidized
imports in their own markets as well, as reflected
in various proposals for special and differential
treatment in terms of counter measures permitted under
the WTO system.
But the answer to their
demands is emphatically not a wholesale extension
to them of the special agricultural safeguard mechanisms,
which allow for exceptions to opening up a given market
in order to prevent a dramatic rise in imports or
a drop in domestic prices caused by a sharp decline
in import prices.
Instead, the answer must
be to correct the distortions at their source.
Further reductions, if
not the eventual elimination, of ''export subsidies''
and more effective disciplines on other forms of export
subsidization are both areas where developing countries
have major interests.
countries, both developing and developed, will be
immeasurably better off when export prices are determined
directly by fairer conditions of market competition
rather than indirectly by bureaucrats calculating
and handing out export subsidies or by the manipulation
of other governmental export promotion programs.
A key point stressed on
all sides of this debate is that, to one degree or
another, all countries have legitimate non-trade concerns
in agriculture, and that these should be addressed
in so far as is possible in ways that are not at the
cost of trading partners.
It is worth recalling
that the Uruguay Round made a significant contribution
towards enabling countries to accommodate, through
domestic support measures, non-trade concerns - such
as food security, regional assistance, and the environment
- in ways that are minimally trade-distorting.
However, these arrangements
are seen as more responsive to the concerns of industrialized
countries, in appearance if not in fact.
The adequacy of these domestic
support arrangements from the point of view of developing
countries will therefore be an important focus of
the agricultural negotiations.
Key non-trade concerns
of developing countries, such as poverty alleviation,
rural development and food security, are qualitatively
quite different from those asserted by certain highly
industrialized countries. And there are many developing
countries that would oppose any combining of the two.
With pragmatic but principled
approach, it should be possible to effectively and
constructively address most non-trade concerns with
a minimum of trade distortion. If so, then there is
a way forward, particularly in case of a broader process
of negotiations where there is greater scope for eventual
tradeoffs for everyone.