TWN Info Service on Trade and WTO Issues (July08/43)
28 July 2008
Third World Network

Trade: African Ministers stress issues, voice concerns on G7 process
Published in SUNS #6526 dated 28 July 2008

Geneva, 25 July (Kanaga Raja) -- The African Group issued a statement on Friday outlining what it expects to see from the negotiations on agriculture, non-agricultural market access (NAMA) and other issues at the WTO mini-Ministerial here. It also expressed concern over the G7 process in that not one African country was represented in this group.

The Group said that seven days after arriving in Geneva to finalize modalities in agriculture and NAMA, it was "deeply disappointed" by the lack of progress in the negotiations, which it said, "are now unfortunately focused on the so-called G7... The African Group of Ministers have been kept in the waiting room with no positive outcome in sight."

It called upon the G7 to demonstrate proper leadership and adequate political will to unblock the issues.

In a statement delivered on behalf of the African Group at a media briefing Friday, Mr. Uhuru Kenyatta, Deputy Prime Minister and Minister of Trade of Kenya, said that ten Ministers from the eight African countries are in Geneva attending the WTO Mini-Ministerial meeting: Burkina Faso, Cameroon, Egypt, Gabon, Lesotho, Mauritius, South Africa and Kenya.

Their presence underscores the importance that the African continent attaches to the Doha Round, which aims to place development at the centre of the trade negotiations.

The statement said that in agriculture, "we expect the outcome of these negotiations to unlock the production potential of this sector in Africa so that it can effectively contribute in addressing our development needs such as livelihoods, food security and rural development."

The negotiations in agriculture therefore, should result in real and effective substantial reduction of trade distorting domestic support in rich industrialized countries, and increased market access for products of export interest to African countries. If this is done, African Countries will develop themselves via fair trade rather than relying on the diminishing aid. "We therefore expect an effective solution that will address the instability of commodity prices in the world market, which continue to adversely affect the export of our commodities."

Import surges have also continued to undermine agriculture production in African countries. The African Group therefore expects an agreement on Special Safeguard Mechanism that will effectively address import surges which mostly arise from unfair trade practices, particularly from trade distorting domestic support systems.

On cotton specifically, "we expect a more ambitious outcome that will substantially accelerate the reduction of production subsidies in developed countries. Millions of poor people in Africa are dependent on cotton production. However, the huge subsides provided by the developed countries have continued to depress world prices and thereby driving farmers out of production with no other sources of income."

"We are therefore looking forward to an effective and long-term solution on cotton. Of equal importance to the trade policy aspects of the cotton issue, is the development assistance dimension," said the African Group.

This is in the Doha mandate, said the Group, adding that progress has however been made on this aspect, but there is wide scope for faster implementation of the commitments by the developed countries and even faster disbursements.

On the issue of bananas, the African Group would like a solution that will not impact negatively on the African banana exporting countries. "We are therefore in support of the current consultations initiated by the WTO Director General on this issue with a view to arriving at an amicable solution that will continue to facilitate exports of bananas from Africa."

The African Group also said that it has concerns in both agriculture and NAMA negotiations regarding the negative impact of tariff reductions on preferences. Most of the exports from African countries are dependent on preferences granted mainly by the developed countries. The erosion of preferences will expose exports from Africa to abrupt competition leading to disruption of exports with adverse impact on export earnings as well as job losses. This can cause instability in the African Countries.

On non-agricultural market access negotiations, the African Group said that it is demanding for sufficient flexibilities in order to nurture and safeguard our industrial base. The African Group therefore will not accept proposals that will restrict flexibilities and thereby constrain policy space in the manufacturing sector. Sectoral initiatives must be purely on voluntary basis and should not be linked to the formula for tariff cuts.

The sectoral initiatives also must not have any impact on the preferential market access. In the context of fulfilling the development dimension of this Round, "we expect concrete commitments on the provision of assistance to enhance supply side capacity, so that African countries can take advantage of the increased market access opportunities that will arise from this Doha Round."

The Group supports proposals to amend the TRIPS Agreement to accommodate CBD issues to enable the continent to equitably share the full benefits arising from its enormous biodiversity resources.

The group attaches great importance on the development aspect of the extension of geographical indications as well as their registration. This will protect the originality of the African products and enhance both the market potential for resources emanating from the continent and the accrual of tangible benefits to the African Countries from which these resources originate. It will also be a good marketing tool that will ensure that African products do not lose identity in the global markets.

It said rules resulting from these negotiations in all areas, must not constrain the process of Africa's industrial development.

The Group stated that the negotiating process in this Mini-Ministerial has demonstrated the need for more work to be done in improving WTO decision making, inclusiveness, openness and transparency.

"We are deeply concerned that in the Group of Seven (G7), not one African country was represented in a round that purports to be about development. This does not augur well for the future of global governance."

The African Group called upon the G7 to demonstrate proper leadership and adequate political will to unblock the issues that have obstructed the timely conclusion of the negotiations that should lead to the development of modalities in agriculture and NAMA.

"We want to point out in this regard that we from Africa with our limited resources have bent over backwards to give all that we have to ensure that this Doha Development round is successfully concluded," said the Group.

"We would want to recall at this point that when this DDA was launched, we did not demand for the Doha round, the developed countries are indeed the ones who demanded it and they are the ones blocking the movement forward."

"We came into the round in good faith convinced it would be truly a development round that would help our African continent that is the most need of development to be able to pull out of abject poverty and join the rest of the world as an equal partner in global trade," the statement said.

"At this point in time therefore, seven days after arriving in Geneva to finalize modalities on Agriculture and NAMA, we are deeply disappointed by the lack of progress in the negotiations that are now unfortunately focussed on the so called G7 comprising of the major developed and advanced developing countries. The African Group of Ministers have been kept in the waiting room with no positive outcome in sight."

"We therefore once again call upon this Group to make the necessary political decisions to ensure that we as the representatives of the Global trading communities do not fail our people. This is a historic moment and we must seize this opportunity to ensure that we succeed. Failure is an option that we cannot afford," said the African Group statement.

Asked at a media briefing Friday as to what would be the bottom line for the G7 to deliver, Mr Kenyatta said that the G7 is shouldering a responsibility. "They have been meeting for the last two days, while we as the African Group, have been waiting in the waiting room."

"What we are saying is that leadership also comes with responsibility. That the issues pertaining to the G7 should not be the only issues at the table. They need to realize that there are over a 150 different countries here in Geneva waiting for them to show leadership, waiting for them to give on both sides so that we can all make progress and so that we can all achieve what this round is expected to achieve."

"We have been patient." he said, adding: "We have understood that there is need for that smaller group to indeed engage, but what we are saying is we cannot wait forever. We need a result."

The Deputy Prime Minister of Mauritius, representing the ACP Group, said "we have made a lot of sacrifices. Notwithstanding the fact that we are not very happy with everything that is contained in the two texts, we agreed to the architecture of what is being proposed. We also agreed to the level of ambition that all stakeholders are proposing."

He said that there are issues of great concern to us -- preference erosion, bananas and cotton.

On LDCs, he said that the text remains unclear on what products will be offered on duty free and quota free to all the LDCs. On Aid for Trade, he said "we are asking for flexibility, we are asking for time in order to help build productive capacity in our countries in order to take advantage of market opening."

On behalf of the ACP, the Minister said that "some of us were in the Green Room but we have accepted the process because at times, you need efficiency, because we want a successful round, but we want our concern also to be addressed and we hope that we'll find a solution that is fair, that is balanced, that is comprehensive, but that doesn't forget the middle D (Development) in the DDA (Doha Development Agenda)."

The Deputy Minister of Egypt said: "We came here with very clear priorities for the African Group", she said, referring to preference erosion, cotton, SVEs, flexibilities, and all issues of interest to Africa.

Yet, surprisingly, she said, we have been faced with new facts like increasing trends for eliminating the flexibilities; or the anti-concentration clause; or trying to link the sectorals with the formula and coefficients in NAMA, which she said, was supposed to be voluntary.

She also said that the cotton issue was not raised in the G7 consultations. This is why we call upon the G7 to put our priorities, as a priority for the consultation, because this is a development round, and without addressing the development needs of the African Group, "we don't see any benefits for us from this round." +