Debate heats up over agricultural trade reforms
12 March 2005
Pressure on the US mounts during discussions at a recent meeting of Trade Ministers in Nairobi, Kenya, and following the ruling of the WTO appeals mechanism finding the US in violation of prohibitions against cotton subsidies.
Trade Ministers Meet in Mombasa; Discuss Reforms
Trade ministers from 33 countries met in Kenya for two days during the first week in March to discuss areas of trade reform for the July round of Doha talks. Meeting participants reiterated allegations that trade barriers in wealthy countries interfere with poor countries’ chances of escaping poverty by exporting farm goods. The meeting served as a forum for poor countries to demand cuts in the agricultural subsidies in industrialized countries that plague trade liberalization agendas. Discussions focused on determining when, how, and by how much subsidies will be cut. Kenyan Trade Minister Mukhisa Kituyi was quoted as saying “We are saying open your market; allow greater access for our produce.”
The WTO is hoping for initial reform agreements in the areas of farm and industrial goods trade and services and development issues by the end of July. The WTO General Council hopes the July meetings will serve as a “first approximation” of resolving the issue of calculating tariffs on agricultural imports in a uniform manner. The stated goal is to produce a completed framework by December 2005 in Hong Kong, so that negotiations can end in 2006. The Doha Round of trade talks have been stalled several times since their initiation in 2001.
WTO Upholds Ruling Against US Cotton Subsidies
As a backdrop to the Kenya meeting, the WTO Appellate Body upheld findings that US cotton subsidies were in violation of trade rules, supporting calls that the US cut hundreds of millions of dollars in subsidies to its cotton industry. Members of the WTO, particularly Brazil, showed support for the ruling. The verdict reinforces global trade rules that would allow Brazil to levy trade sanctions against the US if it continues to behave out of compliance with the rules. Cotton-producing countries are calling on the US to comply with the decision immediately. According to acting US Trade Representative Peter Allgeier, the US is “analyzing the report carefully.” The verdict serves as a symbolic victory for poor African cotton farmers who blame US subsidies for destroying their livelihoods. This latest ruling has potential to inspire similar legal challenges regarding other US subsidies.
For additional information, see the following articles:
- Kenya Meeting Said to Give Push to WTO Agricultural Negotiations, US Dept. of State, March 4, 2005 (AllAfrica website)
- Poor States Demand Farm Reform at Kenya WTO Meet, David Mageria, Reuters, March 4, 2005 (Reuters website)
- Trade Ministers Agree to Craft A Rough Plan By July on How Rich Countries Will Cut Farm Subsidies, World Bank, March 7, 2005 (World Bank website)
- Brazil: WTO cotton victory against US reaffirmed; Pressures EU on sugar, BRIDGES Weekly Trade News Digest, Voume 9, Number 8, March 9 2005