Global Policy Forum

By Ravi Kanth Devarakonda

Faced with the global financial crisis and high food prices, African countries want to conclude the much-delayed modalities agreement in the Doha Round of talks on agriculture and market-opening for industrial goods by the end of this year.

But they are not going to tolerate the ongoing attempts to lower the ‘‘developmental dimension'' in the modalities agreement by some key members of the World Trade Organisation (WTO), several African trade envoys told IPS. The modalities (parameters) agreement comprises a maze of rules that stipulate how WTO members must reduce their farm subsidies and import tariffs, as well as import duties on industrial goods. For African countries, the important developmental issues in these parameters include a steep reduction in the global cotton subsidies; special flexibilities to safeguard important farm products on which tens of millions of poor farmers survive; the mitigation of the erosion of trade preferences provided by their erstwhile colonisers; the duty-free and quota-free access for least developed countries with simple and easy rules; and so on.

‘‘We are worried about the financial crisis, as well as the rising food prices, because most of our countries are dependent on external trade and we also import many agriculture products,'' said the coordinator for the Africa, Caribbean and Pacific (ACP) group Ambassador Shree Baboo Chekitan Servansing. ‘‘Trade is part of the solution in the current global financial and food crisis and a strong agreement to reduce farm subsidies and rebalancing of trade rules will augur well for the world economy,'' he told IPS in an interview. ‘‘Any delay to conclude this agreement will further compound the worsening crises,'' Servansing argued. Besides, the financial crisis in the leading industrialised countries is bound to cause a hole in official development assistance budgets. It will crowd out aid for trade. ‘‘Therefore, it is important that the DDA (Doha Development Round) is wrapped up without much delay,'' he emphasised.

‘‘The Africa group has decided to commit to concluding the Doha modalities negotiations by the end of 2008,'' said Ambassador Guy Alain Emmanuel Gauze, the Africa group coordinator at the WTO. ‘‘We are still working hard to ensure that the work on the modalities agreement in agriculture and NAMA (non-agricultural market access) is proceeding smoothly,'' he told IPS. An early agreement in the Doha Round ‘‘may unlock'' the current stalemate in addressing various global problems and ‘‘will boost global trade at a time when fears of protectionism are on the rise,'' said Dr Anthony Mothae Maruping, Lesotho's trade envoy and the coordinator for the least developed countries (LDCs) group at the WTO. However, the three coordinators expressed sharp concern over sustained attempts to undermine the developmental components in industrial goods and duty-free and quota-free market access for products exported by the LDCs.

As regards negotiations on industrial goods, the African countries are opposed to sectoral tariff elimination as it would adversely impinge on their trade preferences. Sectoral tariff elimination involves bringing tariffs on agreed products to zero. For the U.S., it is a vital demand to satisfy its domestic industrial lobbies and secure support for the modalities agreement. ‘‘Sectoral tariff elimination is not obligatory for African countries. It is only voluntary,'' said Gauze, suggesting that they will not join the negotiations on this issue. ‘‘We are opposed to all the elements in the sectoral tariff elimination,'' said Servansing, arguing that this issue would further undermine trade preferences. Also, the duty-free and quota-free access for African countries cannot be burdened with what are complex rules of origin, said Maruping. There is still no clarity on various aspects relating to duty-free and quota-free access, according to him.