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Old 09-15-2003, 10:57 AM   #1
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Normal WTO trade talks collapse

September 15, 2003
Poorer Countries Pull Out of Talks Over World Trade
By ELIZABETH BECKER


ANCÚN, Mexico, Sept. 14 — World trade talks intended to help the developing nations unexpectedly collapsed today when delegates from Africa, the Caribbean and Asia walked out, accusing wealthy nations of failing to offer sufficient compromises on agriculture and other issues.

While not as disastrous as the breakdown of talks in Seattle four years ago, the failure to reach an accord today was widely regarded as a huge setback for the World Trade Organization, the 146-nation group that was presiding over the talks here. The group, based in Geneva, will now almost certainly fail to make its self-imposed deadline of January 2005 for reaching a new agreement that dismantles global trade barriers.

The failure today also means the faltering global economy will not receive a jump-start by the expansion of markets, which some economists contend would inject hundreds of billions of dollars into international commercial activity.

"We all could have gained here and now we have all lost," said Pascal Lamy, the European Union's trade negotiator, commenting on the collapse of the talks.

Robert B. Zoellick, the United States trade representative, sounded less pessimistic but still spoke with some frustration. "The harsh rhetoric of the `won't do' overwhelmed the concerted efforts of the `can do,' " he said.

Wealthy nations had hoped an agreement at the five-day talks in this resort city would help fend off a new wave of protectionism, especially in the United States, where manufacturing jobs have been disappearing by the tens of thousands. Already, questions about the benefits of unfettered world trade have infected the presidential campaign.

Supachai Panitchpakdi, the director general of the W.T.O., tried to be optimistic tonight, saying, "We must return to the task before us with renewed vigor," to complete this round of trade negotiations, which will continue at a low level at the group's Geneva headquarters.

"If we fail, the losers will be the poor and weaker nations," he said.

The immediate cause of the breakdown was proposed new trade rules for investment and government procurement, which had been promoted by the European Union but opposed by the poorer nations. But agriculture was the pivotal issue. Developing nations had established themselves as a potent force in talks here this week, challenging the earlier supremacy of the United States and Europe in trade talks.

Banding together in what was known as the Group of 21, the developing nations thought they had made their case that the $300 billion in subsidies paid every year to the world's wealthiest farmers undermined the livelihoods of millions of poor farmers around the world. But they said the proposals made by the United States and Europe to redress what the developing nations regard as a major injustice fell far short of their expectations.

Richard L. Bernal, a delegate from Jamaica, said a group of African, Caribbean, Asian and Latin countries felt they had little choice but to quit the talks. The United States and Europe, he said, were not generous enough on reducing their agriculture subsidies, on helping poor African countries dependent on cotton, or on understanding their difficulties in taking on such complex trade responsibilities as investment.

"There is nothing for us small countries in this proposal," he said. "We don't want any of this."

Yet those nations said tonight that they blamed no one for the failure and vowed to work for a trade agreement on agriculture now that the talks move back to Geneva. Celso Amorim, the Brazilian minister of foreign affairs and a spokesman for the group, said those nations had demonstrated that they were a new force in the trading organization.

"This is the real start in negotiations over agriculture," he said. "Whatever the process, the pieces will be picked up again."

Mr. Zoellick said he would move ahead on free-trade agreements with individual nations or regions, noting he had a long list of countries that wanted to negotiate with the United States. Meanwhile, he said, he would wait for things to "calm down" at the World Trade Organization.

"I hope we can help those countries come around," he said, without identifying them.

Mr. Zoellick said he believed that the talks were unlikely to reach a conclusion by their deadline. The message he heard from many members, he said, was "not now."

Mr. Lamy, the European trade commissioner, said the failure in Cancún "is not only a severe blow for the world trade organization, it is a blow to all." Still, he said, "We are going to remain committed to strengthening this rules-based multilateral trading system."

Progress toward a new agreement on trade, which was started two years ago at a W.T.O. meeting in Doha, Qatar, has repeatedly been stalled. Trade officials had missed every deadline until last month.

Then the United States broke an important political and emotional deadlock. American negotiators agreed to accept a proposal they had rejected last December to give the world's poorest countries access to life-saving medicines. That agreement — which is unaffected by the setback today — breathed life into the trade negotiations and demonstrated that the United States would join Europe in working out a compromise over initial objections from their pharmaceutical firms.

Members of some antiglobalization nonprofit groups that have been demonstrating outside the heavily guarded talks broke into song when the collapse was announced, cheering that the talks they considered unjust had failed.

But Phil Bloomer, director of Oxfam's campaign against the agriculture policies of rich nations, said he took no delight in the failure of the talks, which he said was a blow to poor nations that needed immediate relief for their farmers.

"It appears the United States and the European Union were not prepared to listen and take the necessary steps to make global trade rules work for the poor as well as the rich," he said.

If a new agreement is reached, the World Bank has estimated, global incomes would increase by as much as $520 billion by 2015, and 144 million people would be lifted out of poverty.

But developing nations said no deal was better than a bad deal.

Several delegates said they walked out today rather than negotiate new trade rules covering investment or government procurement, in part because they feared the new rules would be too intrusive and limit a country's freedom to regulate the environment or workers' rights in the face of international trade laws protecting foreign investors.

"We wanted to negotiate issues that are essential for us — agriculture subsidies, closed markets," said Yashpai Tandon, a delegate from Uganda. "Why would we now add investment? It is too much."

He singled out the dispute over cotton subsidies as a major disappointment. Four of Africa's poorest nations had asked that the subsidies given to American and European cotton farmers be reduced and the African farmers be paid $300 million in compensation for the losses they suffered because of unfair competition from wealthy farmers. Instead, a draft proposal suggested that the question be studied and that the African farmers plant other crops.

"It got to be too much for us," said Bakary Fojana, a delegate from Guinea. "The cotton offer was unjust and ignored what was demanded by African nations. Coming into this meeting everyone said, `yes, cotton is an important question; yes, agriculture is important.' But when it came down to negotiations, our daily problems were ignored."
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Old 09-15-2003, 11:05 AM   #2
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I heared a french politician in the radio a few minutes ago he said:
"Everyone looses because we couldn't find a agreement in the same way as everyone whould have profited if we'd found an arangement"

It's allways the same, we ask the 3rd world to open the market, we ask others to stop subsides but... we have "good reasons" not to open our markets and not to stop our governemt to support local economy

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Old 09-15-2003, 11:22 AM   #3
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Damn. This is bad news.
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Old 09-15-2003, 12:45 PM   #4
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I cannot support ending farm subsidies either, because Western farmers will never be able to compete against the poverty wages that the third-world can survive on.

The only way "free trade" will be equivalent to "fair trade" is by levelling the playing field, whether that be through establishing some sort of minimum guidelines, similar to how the EU admits member nations after meeting certain criteria.

As someone who grew up with farming, the end of subsidies will mean the end of Western farming. Period. That is something that would certainly not be prudent.

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Old 09-15-2003, 12:59 PM   #5
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Quote:
Originally posted by melon
I cannot support ending farm subsidies either, because Western farmers will never be able to compete against the poverty wages that the third-world can survive on.

The only way "free trade" will be equivalent to "fair trade" is by levelling the playing field, whether that be through establishing some sort of minimum guidelines, similar to how the EU admits member nations after meeting certain criteria.

As someone who grew up with farming, the end of subsidies will mean the end of Western farming. Period. That is something that would certainly not be prudent.

Melon
But that is of no concern for the poor countrys. I am glad the poor countrys finaly got together to make one fist against the powerblock of the western world.
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Old 09-15-2003, 03:23 PM   #6
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Melon, why do you define this as a zero sum game? And what makes the right of American farmers more important than the impoverished subsistence farmers that US-backed mullitnationsal have displaced?

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Old 09-15-2003, 03:59 PM   #7
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Quote:
Originally posted by Sherry Darling
Melon, why do you define this as a zero sum game? And what makes the right of American farmers more important than the impoverished subsistence farmers that US-backed mullitnationsal have displaced?
They were impoverished far before the U.S. ever existed. The mere existence of the First World, however, creates as a large contrast to the Third World conditions, which have never improved over the centuries.

Ripping down the First World is not going to ensure Third World wealth. Take a look at Zimbabwe with President Mugabe's land redistribution, for instance. Taking away land owned by established white farmers and giving it to blacks didn't create more black farmers; rather, it just destroyed their agricultural base.

There are other ways to prop up the Third World, aside from ripping us down to their level. We will never be able to compete with near slave labor and nor should we want to.

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Old 09-15-2003, 04:32 PM   #8
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Quote:
Originally posted by melon
Ripping down the First World is not going to ensure Third World wealth.
I agree with Melon here
although I do think it's probably good the third world countries stand up for themselves we can't expect the first world country not to do the same
and western farming would indeed end if they had to compete third world wages
(something dutch politics seems to have foreseen since they have been trying to make it impossible for any farmer to survive over here for years now, but that's another topic entirely)

I think the real downside to that would be that it would lead to many (people in) first world countries not being willing to cooperate in helping third world countries anymore


so a solution needs to be found that both sides can live with
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Old 09-15-2003, 06:00 PM   #9
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Free trade for me is that everyone produces what he can do best (in this case "3rd World": Agricultural products "we": Technology)
If you say it's ok to protect our market from their cheaper products to save jobs, why should they open their market for our products?
Don't you think that their Steel production (just an example) has a handicap because of lower technology - according to your thoughts it would be absolutely ok to raise import taxes so that the economy at home can survive.
At the end we won't have ANY free trade left. Everyone closes his markets to protect his people. Every company and every customer has to pay more for products because they have no access to the cheapest one.
As a result we will have a much weaker economy

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Old 09-15-2003, 06:08 PM   #10
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Tariffs and market protection have been around for centuries. If anything, we have more free trade today, not less.

I agree with Melon on this one.
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Old 09-15-2003, 08:32 PM   #11
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Melon: You didn't response directly to my questions. Why is it a lose-lose proposition? And what makes our farmers worthy and theirs not? Classic "in group/out group" thinking. Surrender your liberal membership card

To respond to your point, your statement that the wages the third world "can survive on" deeply offends me, mostly because THEY'RE DYING! Get on the UN website, or the World Banks, and check the mortality and disease stats. Now, is free and fair trade a paneca? Of course not--there is no such thing. But you have to realize that the third world didn't just end up in this position--Europe colonized most of it, for one thing, explicitly for economic trade and market purposes. The US did the same, only a more subtly kind of economic colonialism. The US and EU currently run the IFIs with outrageously exlusive voting procedures. Etc. etc. It doesn't appeare to me that you're considering the context, historical or present, here, but I might be wrong about that. Further, it's a myth that these societies have always been impoverished.

NBC: Yes, yes they have. Which is one of the main reasons it is so maddeningly hypocritical that we tell these infant economies that they can't protect their markets, but we can protect ours. Every developed nation grew its economy by the use of tariffs, protections, etc etc. And now we use veiled diplomatic threats, the IFIs and and WTO to force open their markets before they're ready while we get even richer! Meanwhile, subsitnance farmers die and 14 years olds in sweatshops are worked in violation of any labor standard any modern American would expect and demand. How can that possibly be just?

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Old 09-17-2003, 02:25 PM   #12
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for Melon and NBC.

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Old 09-17-2003, 05:46 PM   #13
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I know this is not really a solution. More a rant.

But it just drives me bananas that a farmer in Ontario competes with a farmer in Mexico. It is incredibly fucked up.

It should not be cheaper to grow a tomato in mexico then ship it to Toronto than it is to grow them in the Holland Marsh 50 km away from the city.

We measure the cost of production in a mind boggling way.

Everyone buy local!
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Old 09-17-2003, 05:51 PM   #14
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this is just terrible and makes me sad.
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Old 09-17-2003, 11:07 PM   #15
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Quote:
Originally posted by iacrobat

Everyone buy local!
Amen to that. There is enough production capacity and enough market for everyone. Trouble is, these subsidies result in the EU and US overproducing, which then forces us to dump our goods real cheap in foreign markets.

Trade is importantn for relations, though. But surely at least for food, such a basic human need, everyone having enough of it should take priority over market forces or profit, no?

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