In Lesotho, trade ministers from the world’s poor countries are meeting over the next three days to discuss moves to liberalize trade. Poor and rich nations have been at odds over such things as agricultural subsidies and tariffs. The NGO ActionAid is criticizing past efforts at liberalization, saying they have cost sub-Saharan African countries hundreds of millions of dollars.
Tim Rice is ActionAid’s trade policy officer. From London, he spoke to VOA English to Africa Service reporter Joe De Capua about the significance of the Lesotho meeting.
“Every time there is a fully fledged World Trade Organization ministerial, it’s usual for some of the developing country groupings, in this case the least developed countries (LDCs), to come together to discuss various mutual aspects to do with various parts of their economies, one of which will be to do with trade. And no doubt they will be discussing the World Trade Organization as they try to reach an agreement in Geneva in the next month or so. So that really is the importance of this meeting, as far as least developed countries are concerned,” he says.
Recently, President Bush said it’s possible to reach a global trade deal this year if all parties involved make concessions. But is such an agreement possible, with the rift over some issues between rich and poor nations? Rice says, “At the moment, the rumor coming out of Geneva is that there is still very little convergence on some of the major issues, particularly on agricultural tariffs, on agricultural subsidies to some extent and also on the non-agricultural market access negotiations. I think what is happening is that once again the developed countries are asking far too much of the developing country nations. Developed countries believe that if they give a little bit on subsidies that the developing nations should open up their markets a lot. And clearly is unacceptable when some of these developing countries are still very fragile in terms of their economies.”
Agriculture subsides is a major issue at trade talks. Rice explains why developing countries see this as an important issue. “Unless there are meaningful reforms to developed countries’ agricultural subsidies, those same developed countries will still export into the world market at preferential prices and therefore disrupt developing country markets and their small-scale producers. So what they’re saying is that the only defensive option that they have in agriculture is their own tariffs, developing country tariffs. And if they lower them, there is a possibility there will be a large surge in agricultural products coming into their economies. Some of these products may well be dumped in their markets, greatly disrupting local producers and in many cases actually putting them out of business,” he says.
ActionAid says over the last 20 years, the opening up of developing country markets without much favorable response from rich nations has cost sub-Saharan Africa $272 Billion. The group adds that LDC trade ministers may criticize current trade proposals at the Lesotho meeting, which opened Wednesday. It says LDCs may have greater leverage by banding together in their complaints and proposals.