Editorial

The significance of the Cancun collapse

Did the walkout of the poor nations of the world at Cancun, on Sunday collapsing the much awaited World Trade Organisation meeting signify that developing nations, after years of retreat and surrender to the developed nations, are once again rallying round and taking a defiant stand? Or was it a move that would have jeopardised a major opportunity created in moves made at Doha, Qatar, in 2001, to expand world trade that could have boosted global incomes by as much as $ 500 billion a year - enough to raise 144 million people out of poverty by 2015, as predicted by the World Bank?

According to reports from Cancun, representatives of poor nations who had travelled all the way were jubilant after the collapse of the talks.A woman representative of Ghana Agricultural Association was quoted saying: ‘This is the best thing that could have happened to developing nations for a long time...... If Africans have to compete with rich nations on the price of exporting a mango or rice or cotton, how can we ever work our way out of poverty? Perhaps, the same thoughts come to the minds of those at the Colombo’s Mariyakade fruit market when they are told that a Sri Lankan mango cost as much as Rs. 70 while imported apples abound are only Rs. 20.

After the collapse of the Berlin Wall and the Communist bloc thereafter, the resistance offered by Third World leaders to the unfair trade practices of the rich nations completely disappeared. The Non Aligned Movement developed a chronic locked jaw. Gone was the verbal bashing on the North-South dialogue at meeting such as in UNCTAD. As a Sri Lankan diplomat noted it appeared that the thinking was: Divided we stand, united we fall. We went along meekly with the United States and the other developed nations, because there was no other option.

Now, did the worm finally turn at Cancun?

Certainly what happened there was no revolution. The poor nations of the world will still have to play by the rules of the WTO and abide by dictates of the IMF and World Bank. This is not the end of the WTO and globalisation. We will be dancing in the streets if the United States signs a Free Trade Agreement with us. Cancun is significant in that at least after years the poor of the world picked up enough courage to say, ‘No’ to the rich and mighty.

Why the Cancun summit collapsed was because the poor nations refused to accept the proposals made, rejected new rules in investment that were proposed and demanded that those countries such as the United States, European Union and Japan lower their huge agricultural subsidies to their farmers. It has been pointed out that rich nations pay as much as $ 300 billion in subsidies to their farmers leading to over production if many crops such as cotton that are dumped on global markets depressing prices and rendering farmers of the developing countries absolutely destitute. Four of the poorest African countries Burkina Faso, Benin, Chad and Mali are asking the United States, Europe and China to end the $ 6 billion per year subsidy paid by the US to its farmers claiming that their farmers are losing $ 250 million per year from subsidised competition and low prices.

The rich nations too have their own problems. The United States and Europe, it is claimed after eight rounds of negotiations that slashed tariffs and removed other obstacles to the movement of goods and services across borders have very little to give now, except in the two most politically sensitive areas - the farm sector and the textile and apparel industries. Tariffs in these sectors remain high because of the clout they wield with governments, particularly in Washington, it has been argued.

Poverty and disease in the poor African nations were not the only factors that featured at Cancun. Reports indicate that the American presidential elections next year did. American farmer groups attending the conference have said that they were pleased with US Trade Representative Robert Zoelick because he had been able to protect the farm bill of 2002 which raised subsidies by $ 40 billion. Farm states had voted heavily in favour of George Bush in the 2000 election. Agribusiness had shifted its allegiance decisively towards the Republican Party.

According to a report in the New York Times, yesterday the US presidential campaign is seen as a possible cause for the collapse in the Cancum accord on farm aid. It is contended that the developing nations were convinced that it was hopeless to expect any realistic negotiations with Americans this year on farm subsidies.

Whether the highly opinionated representatives of constantly squabbling developing nations were able to reach such consensus in the hope of the defeat of George Bush and the election of a president more favourable to the Third World is debatable. However, it is indeed encouraging that they have, after a long period of servitude, summoned enough courage to defy the rich and mighty. To meekly submit to policies in silence that will keep the poor of the world in rags and hunger makes no sense.


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