(THIS ARTICLE IS MACHINE TRANSLATED by Google from Norwegian)
By Professor Ruth Haug,
Head of Noragric, University of the Environment and Life Sciences, Ås
ruth.haug@umb.no
[Chronicle] There is movement again in the WTO. 26. July negotiators presented new draft agreements to be considered in September. One of the goals of the ongoing Doha Round or Development Round as it is called is for the poor countries to profit from trade and globalization.This is not possible. It is not possible to agree on development goals in the WTO. Promises given to poor countries can be relatively loose in other, more non-binding forums. For example, G8 in Gleneagles in 2005 gave reason for weak optimism, but was not followed up in Heiligendamm in 2007. There are many promises, but when the effect of measures can have a negative effect on the rich countries, the action fails. Unfortunately, it seems that change is only possible when it comes to a win-win situation and that the win is greatest for the rich countries. Unfortunately, the world of reality does not consist of just winners.
Stronger when negotiated internationally. While the WTO negotiations have been stomping, the rich countries (US and EU) have concentrated on regional and bilateral agreements. These agreements place tough demands on developing countries and are expected to reinforce the differences between poor and rich. A number of bilateral and regional agreements can also be seen as a way to undermine multilateral solutions.
The developing countries have shown greater bargaining power in international settlements where they are numerous and where powerful spearheads such as Brazil, India and China can break. A multilateral body may also play an important role in disputes such as the WTO's "trade judgment" in relation to US subsidized cotton production. In Europe, there have been a number of demonstrations this spring led by the Trade Justice Movement against the Free Trade Agreements Economic Partnership Agreements (EPAs). These bilateral and regional agreements are negotiated between the EU and African, Caribbean and Pacific countries. in relation to investments that have been rejected by developing countries in the WTO negotiations.
On a par with the EU and the USA. The Norwegian government, led by Jonas Gahr Støre and Erik Solheim, came out in May this year with a draft plan for trade-oriented development cooperation. It states that the government will strengthen the ability and ability of poor countries to trade, promote an international trade regime in which consideration for poor countries is given decisive weight and in the WTO negotiations act as a supporter of countries that promote interest in the poor part of the world. This carries promises of a change in Norwegian WTO policy.
Norway and the G10 have largely played on teams with the EU and the US, for example when it comes to support for their own agriculture. As Atle Sommerfelt wrote in a column in Ny Tid a little over a year ago about Norway's positions in the WTO: «the Norwegian negotiations in favor of Norwegian small farmers have become a handshake for further export agriculture in the EU and the USA and thus a collapse of agriculture in poor countries ».
Worst in class. The new Norwegian plan for trade-oriented development cooperation may contribute to Norway moving up the list and no longer being ranked as one of the worst in the class when it comes to trade with developing countries. As usual, the Commitment to Development Index 2006 ranks Norway and Japan as the two worst OECD countries in terms of trade in promoting development in poor countries.
It can of course be questioned whether this measurement gives a correct picture of the situation, but it still gives an indication that things are not quite right with Norway as a trading partner for the developing countries. Statistics Norway has developed a set of indicators for sustainable development that includes Norway's trade with Africa. Imports from Africa accounted for about 2% of total imports to Norway in the mid-90s and in 2006 had fallen to about 1%. Imports from LDCs in Africa in 2006 accounted for only 0,15% of total imports to Norway – of which about half were imports of crude oil from Equatorial Guinea.
Now it is not necessarily a given that there is a direct connection between increased imports of goods from Africa to Norway and poverty reduction in Africa. In addition to measuring the size of how much Norway and other rich countries import from Africa, one should of course also evaluate the extent to which increased trade leads to the desired results in relation to poverty reduction.
Africa's potential. In sub-Saharan Africa, agriculture generally accounts for about ½ of employment, 1/3 of GDP and ½ of exports. Agriculture is a sector where Africa has goods that can be exported and has the potential to increase production. In many countries in Africa, smallholder farmers can tell us that they can produce much more if they had a market that gave a fairly decent price for their products. The issue for many African countries is, in the first instance, how the country's own agricultural products should be able to be competitive in the domestic market in relation to imported agricultural products (subsidized, dumped or in a purely market liberal spirit).
In order to be able to develop their own agriculture, African countries must be given the right to protect their agriculture from imports. But we cannot demand the same right in the rich countries. We must be willing to let go of our protectionist agricultural policy, increase market access to African countries and follow up with development assistance measures, for example in relation to quality requirements, so that the countries are able to take advantage of market access.
According to the Customs Preference System for Developing Countries (GSP), it is possible to grant trade preferences on an objective basis, eg one can use poverty level or income level as criteria for trade preference. Norway should turn imports of agricultural goods so that we import more from Africa and less from OECD countries. Here is an opportunity that will be less conflict-filled for the current government in relation to the Center Party and the Norwegian agricultural industry than letting go of a protectionist agricultural policy. But in practice, Norway is unfortunately bound up by the EEA and other considerations that make such a twist difficult. For example, how long have we not talked about doing anything about the import of subsidized sugar from Denmark in favor of buying sugar from countries such as Mozambique or Malawi. How about introducing punitive tariffs on imports of subsidized products from OECD countries so that the LDCs can make better use of their duty-free exemption?
One of the main problems in global agricultural trade today is the massive subsidies in the EU and the US that are pushing up prices, making real market access illusory and hampering investment in the agricultural sector in poor countries. Another major challenge is how to make the market work for the poor. The area of development aid, trade and agriculture is another demanding challenge for the red-green government. To what extent it is politically possible to improve Norway's miserable trade efforts towards Africa, we may get a feel for when the new coherence or development committee led by Gunnstein Instefjord delivers its recommendation in 2008. We will also in the resumed WTO negotiations during the late summer and in the autumn, get a feel for whether the government is following up on its new action plan. That is, it changes previous Norwegian WTO policy and really begins to act as a supporter of countries that promote the interest of the poor part of the world's population.
