Info Service on WTO and Trade Issues (Jul14/11)
stockholding programs for food security face uphill struggle
Geneva, 17 Jul (IPS/Ravi Kanth Devarakonda) - Framing rules at the World Trade Organization for maintaining public stockholding programmes for food security in developing countries is not an easy task, and for Ambassador Jayant Dasgupta, former Indian trade envoy to the WTO, "this is even more so when countries refuse to acknowledge the real problem and hide behind legal texts and interpretations in a slanted way to suit their interests."
"The major problem is that the WTO's Agreement on Agriculture (AOA) was negotiated in early 1990s and there are many issues which were not taken into account then," says Ambassador Dasgupta, who played a prominent role in articulating the developing countries' position on food security in the run-up to the WTO's ninth ministerial meeting in Bali, Indonesia, last year.
"If the WTO has to carry on as an institution catering for international trade and its member states, especially the developing and least-developed countries, the rules have to be modified to ensure food security and livelihood security for hundreds of millions of poor farmers," Ambassador Dasgupta told IPS Thursday.
Ironically, the rich countries - which continue to provide tens of billions of dollars for subsidies to their farmers - are insisting on inflexible disciplines for public stockholding programmes in the developing world.
The United States, a major subsidiser of farm programmes in the world and charged for distorting global cotton trade by the WTO's Appellate Body, has called for a thorough review of farm policies of developing countries seeking a permanent solution for public stockholding programmes to address food security.
"Food security is an enormously complex topic affected by a number of policies, including trade distorting domestic support, export subsidies, export restrictions, and high tariffs," says a United States proposal circulated at the WTO on July 14.
"These policies [in the developing countries]," continues the proposal, "can impede the food security of food insecure peoples throughout the world." The United States insists that food security policies must be consistent with the rules framed in the Uruguay Round of trade negotiations that came into effect in 1995.
"Public stockholding is only one tool used to address food security, and disciplines regarding its application are already addressed in the Agreement on Agriculture," the United States maintains.
The agriculture agreement of the trade body was largely based on the understandings reached between the two largest subsidisers - the European Union and the United States - which culminated in what is called the Blair House Agreement in 1992. The major subsidisers were provided a "peace clause" for ten years (1995-2005) from facing any challenges to their farm subsidy programmes at the WTO.
The AOA also includes complex rules regarding how its members, especially industrialised countries, must reduce their most-distorting farm subsidies.
In the face of increased legal challenges at the WTO and also demands raised for steep cuts in subsidies during the current Doha trade negotiations, several industrialised countries shifted their subsidies from what are called most trade-distorting "amber box" measures to "green box" payments which are exempted from disputes.
Jacques Berthelot, a French civil society activist, says that the United States has placed some of its illegal subsidies into the green box.
When it comes to disciplines on food security, however, the United States says it is important to ensure that "[food security] programmes do not distort trade or adversely affect the food security of other members."
The United States has suggested several "elements" for a Work Programme on food security, including the issue of public stockholding programmes, for arriving at a permanent solution. Washington wants a thorough review of how countries have implemented food security in developing countries.
The US proposal, says a South American farm trade official, is aimed at "frustrating" the developing countries from arriving at a simple and effective solution that would enable them to continue their public stockholding programmes without many hurdles.
"The United States is interested in preserving the Uruguay Round rules but not address the issues raised by the developing countries in the Doha Round of trade negotiations that seek to address concerns raised by developing countries," the official adds.
The G-33 group - with over 45 developing and least-developed countries - has brought the food security issue to the centre-stage at the WTO.
Over the last two years, the G-33, led by Indonesia with China, India, Pakistan, the Philippines, Kenya, Nigeria, Zimbabwe, Bolivia, Cuba and Peru among others, has called for updating the external reference price based on 1986-88 prices to ensure that they can continue with their public stockholding programmes under what is called de minimis support for developing countries.
Following the G-33's insistence on a solution for public stockholding programmes for food security, which became a make-or-break issue at the WTO's Bali ministerial meeting, trade ministers had agreed on a decision "with the aim of making recommendations for a permanent solution." The ministers directed their negotiators to arrive at a solution in four years.
Over the last six months, there has been little progress in addressing the core issues in the Bali package raised by developing countries, including food security. "We are deeply concerned that the Ministerial Decision on Public Stockholding for Food Security Purposes is getting side-lined," India told members at the WTO on July 2.
"In this and other areas, instead of engaging in meaningful discussion, certain members have been attempting to divert attention to the policies and programmes of selected developing country members," says New Delhi, emphasising that "the issues raised are in no way relevant to the core mandate that we have been provided in the Bali Decisions."
At a time when the industrialised countries want rapid implementation of the complex agreement on trade facilitation, their continued stonewalling tactics on the issues raised by developing countries has created serious doubts whether the food security issue will be addressed in a meaningful manner at all.
"Credible disciplines for food security are vital for the survival of poor farmers in the developing countries who cannot be left to the vagaries of market forces and extortion by middlemen," says Ambassador Dasgupta. "The delay in addressing food security will pose problems for millions of people below poverty who are dependent on public distribution programmes."