EU upbeat on draft proposals on NAMA and Agriculture: At the cost of Poor countries?
31 Jul 2007
The Crawford Falconer text on agriculture and the Don Stephenson text on NAMA have generated a sort of satisfaction among the European trade officials as the text proposals allow the EU to dish out generous subsidies to its farmers while demanding some of the fastest growing poor countries to substantially lower the taxes they levy on industrial imports from the West.
The draft proposals have not been welcomed by the poor nations and have been criticized vehemently by the anti-poverty activists as it would hit the farmers regressively in these countries.
The talks on agriculture are scheduled to commence Sep. 3, with the NAMA negotiations kicking off later that month.
These papers have been prepared as part of efforts to breathe new life into the Doha talks, which suffered a setback in the G$ talks at Potsdam, Germany. Those hoping for a successful outcome to the round have warned that the next few months will be crucial, particularly as the focus of U.S. politics is soon likely to shift to the 2008 presidential election campaign.
The agriculture paper recommends that a ceiling of between 16.5 billion and 27.6 billion euros (22.5 billion and 37.7 billion dollars) per year should be placed on the EU's 'domestic supports' for farmers. Theoretically, such concessions are not meant to be realized into investments in products meant for export but lead to the 'dumping' of cheap European goods on poor countries, undermining the incomes of their farmers.
Aftab Alam, head of ActionAid's international trade campaign, told IPS that the proposal was "unjust and not acceptable to poor farmers and agricultural workers."
He pointed out that the EU's own Common Agricultural Policy already allows it to spend 12 billion euros (16 billion dollars) on 'domestic' subsidies each year until 2014. Under Falconer's recommendations, there would "still be this big scope" for the Union to increase such expenditure by up to almost 16 billion euros (22 billion dollars).
Alam also protested that Falconer's paper would leave untouched what the WTO classifies as "green box" subsidies. Such recommendations have called for skepticism among the smaller countries as there are also concerns raised about a large part of it being trade distorting.
He underlined, too, how the EU would be able to designate between 88 and 132 agricultural goods as "sensitive" and take special measures to protect them, while a proposal from more than 40 poor countries to allow them protect particular products had been "sidelined". He expressed concern over the fact that 70% of the population in developing countries are engaged in agriculture and the number is only 2% in Europe. Therefore it’s the developing nations that need protection and not vice-versa. Such proposals go against the spirit of the Doha development round.
Again, if Don Stephenson's proposals on NAMA are implemented, the EU would be required to cut its tariffs on industrial imports by 33 percent, the U.S. 29 percent, Brazil 66 percent and India 63 percent. Poor countries are concerned that this would deprive them of the substantial revenues generated from trade taxes and deny them the chance to shield their indigenous firms from floods of cheap imports. This might lead to significant job losses and would stifle efforts by developing countries to move into higher value-added sectors.
Several concerns have been raised by developing countries representatives to maintain the principal leading ambition of the Doha round, which is ‘development’ and not shift focus to ‘market access’.
Released on: 31 July, 2007
Resource: www.ipsnews.net
