Cancun, 10 September 2003
Was the first business day of the Fifth Ministerial Conference of the WTO. In a series of meetings over five days, 146 countries are trying to hammer out a new global order on trade – one that balances the contradictory demands of the rich and poor nations. Perhaps, it would have been for the first time in the history of the GATT/WTO Ministerial that all speakers in the inaugural session were from the developing world. This itself is an indication of the growing importance of developing countries in the multilateral trading system.
Agriculture, and within that the favourable treatment that rich countries afford their farmers, has been the main focus in the speech of every speaker. Developing countries want to see an end to the billions of dollars in farm subsidies in Europe, the US and Japan.
On the eve of the ministerial conference, India along with 20 other developing countries issued a hard-hitting joint communique on agriculture, which has asked the European Union and United States to agree to a phased elimination of domestic support and export subsidies on agriculture. The group has expressed strongly that high subsidies by the rich has depressed farm prices in developing countries to the detriment of millions of poor farmers. What angered the EU and the US most was the joining of Egypt to this group.
This masterstroke by leading developing countries has put developed countries, particularly the EU on defensive. Unlike the previous Ministerials, so far at Cancun, attempts by the EU and the US to split developing countries have been in vain.
However, the EU vehemently criticised the G-21 developing nations including Mexico, for “asking for the moon” regarding the elimination of subsidies, and warned them not to have false expectations from the WTO Ministerial Conference in Cancun. Franz Fischler, the EU Agriculture Commissioner commented, “When considering the recent extreme proposal sponsored by countries such as Brazil, India, China and others, I cant help but think that we are in different orbits entirely. If they want to do business they should put both feet on the ground”.
Sensing the mood and realising a possible conflict between the EU and the developing countries on agriculture and Singapore issues, the US Trade Representative Robert Zoellick, in the meanwhile, has proposed that to keep the negotiations on track there should be yet another ministerial sometime in March next year to meet the deadline of completing the Doha Development round as scheduled by January 1, 2005.
In an article in the Financial Times a day before the key WTO trade talks get underway in Cancun, Pascal Lamy, the EU Trade Commissioner, said the EU offer on subsidies was “fair”. “We are ready to eliminate export subsidies on products of particular interest to developing countries if the US and others are ready to tackle their own means of export support,” said Lamy. In another article in the Financial Express, an Indian newspaper, on September 10, 2003, Pascal Lamy and Franz Fischler, the EU Agriculture Commissioner said, “As the Cancun conference nears, it is time for all parties to recognise the others’ legitimate interests. Name-calling is not going to deliver decisions. At best it is a way of evading one’s own responsibilities.”
Like Doha, at Cancun too, all eyes are on Indian Commerce Minister Arun Jaitley, who has taken a tough posture on contentious issues like agriculture, investment and competition policy and giving no indication of budging an inch from India’s stated position on these issues. In one-to-one meetings with Robert Zoellick and Pascal Lamy, he categorically said that the first priority for the EU and US should be reduction of farm subsidies. Until then, he said, India will not agree to any reductions in its agriculture tariffs. If he persists with this, then in all probability he will replay the act of Murasoli Maran.
As per the proposed business plan, statements in the first day of the Ministerial were made by 20 WTO members, the IMF representative and the World Bank representative, on Item 1 of the Agenda (General Statements). Mexican Minister of Foreign Affairs, Luis Ernesto Derbez, who was chairing the day’s meeting with regard to the process of this week’s discussions, has asked certain “Friends of Chair” to facilitate issue specific consultations.
Singapore has been asked to facilitate consultation on agriculture, Hong Kong-China on non-agricultural market access, Canada for Singapore Issues, Guyana for TRIPS and Geographical Indications and most probably Mauritius for development. The first meeting of the Heads of Delegations will convene in the morning of September 11th. It was underlined that the work of the facilitators will in no way substitute that of the Heads of Delegations. Derbez emphasised that the Friends of the Chair will have to report to the Heads of Delegations. The process he said should be totally transparent and inclusive. At the NGO briefing at the end of the day by the WTO Secretariat a developing country NGO representative expressed concern that it wasn’t a very good idea that Canada, a strong advocate of the Singapore Issues, will be facilitating the discussions on Singapore Issues.
The day’s meetings proceeded peacefully, with only a handful of demonstrators staging a protest in the centre of the conference room at the Opening Session. There was bad news, however, from downtown Cancun. Demonstrations were being held by farmers’ organisations from all over. The agreement with the WTO was that if these organizations would stage peaceful demonstrations, a couple of them would be allowed inside the ‘conference zone’ to make their petition to the WTO. However, a demonstration that started off peacefully became more violent than expected in the course of the afternoon. At the heights of the demonstration, a Korean farmer climbed the high security fence waving “WTO Kills Farmers”, took out a knife and stabbed himself in the chest. Incidentally, he was the same farmer who had camped outside the WTO headquarters in Geneva a few months ago.
With agriculture once again occupying the frontal seat and the informal consultations process adopted being no different from the previous ministerials, things are not very heartening at the end of Day one. In the overall, however, developing countries, by further cementing their alliance on agriculture, have scored over developed countries.