Winners and losers in Hong Kong - Foothill College



Winners and losers in Hong Kong Last Updated: Monday, 19 December 2005 | |

|By David Loyn | | |

|BBC News | | |

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|Developing countries are divided over what was achieved | | |

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|One of the stated ambitions at the 2001 Doha meeting of the World Trade Organization (WTO) was that the developing world would get| | |

|a trade round for free. | | |

|This meant it would not have to make concessions in order to secure benefits. | | |

|But four years on in Hong Kong, according to Oxfam's head of research Duncan Green, "the developed world has won a round for | | |

|free". | | |

|"There is very little in here for developing countries," he says. | | |

|Behind the rhetoric of this so-called WTO 'development round' lies the hard-headed reality that trade terms really matter to the | | |

|relative strength of a country's economy. | | |

|National interest | | |

|Strong positions are not easily given away to help development. | | |

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|[pic]In the first 10 years of tariff reform and trade liberalisation, we literally deindustrialised Zambia | | |

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|Zambian Commerce Minister Dipak Patel | | |

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|That's why the poorest countries have found it hard to make headway in these talks: they have little to offer in return for their | | |

|demand that the richest countries 'level the playing field' in food prices by cutting subsidies. | | |

|Their claim that the cuts would remedy inequalities of the past does not carry any weight at the negotiating table. | | |

|The key concrete concession they won in Hong Kong, which dominated the conference, was an agreement that rich countries should end| | |

|export subsidies to farmers by 2013. | | |

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|US cotton subsidies dwarf the output of many African countries | | |

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|But most of these subsidies were being phased out anyway. | | |

|According to analysis by the aid agency Cafod, the share of export subsidies fell from 50% of EU agricultural spending in 1980 to | | |

|5% in 2004, and were set to drop still further. | | |

|The US had already promised to abolish export subsidies before coming to Hong Kong. | | |

|Cotton is treated differently from other agricultural products, and the US has now agreed to cut export subsidies here too - | | |

|although this was no more than has already been demanded of it by a WTO ruling. | | |

|A separate requirement to reduce US domestic support for cotton farmers in the final Hong Kong text is not mandatory. | | |

|US cotton farmers receive funding worth more than the entire GDP of any of the four west African countries who are campaigning on | | |

|this - Benin, Burkina Faso, Chad and Mali. | | |

|Tit-for-tat | | |

|In return for modest gains in agriculture, the poorest countries have made modest concessions in the other two pillars of the WTO | | |

|process, services and non-agricultural manufactured goods. | | |

|But there was significant disappointment among interests in the richest countries that these did not go further towards a more | | |

|comprehensive free trade treaty. | | |

|Most countries united against Japan, the European Union and the US on farm subsidies, in an alliance of four-fifths of the | | |

|population of the world. | | |

|This unity did not extend to services and non-farm manufactured goods. | | |

|Larger developing countries like Brazil and India want more liberalisation in these sectors and liked the progress made. | | |

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|Pascal Lamy succeeded in securing a consensus | | |

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|Poorer countries still want to be protect their economies while they grow, and are concerned that they may have given away too | | |

|much. | | |

|None broke ranks to walk out, but Venezuela and Cuba reserved their right to oppose the document, which should give them more | | |

|leverage in re-opening discussions on these issues. | | |

|Still, the success of Pascal Lamy - the WTO director-general - was in producing any consensus at all after the collapse of the | | |

|process at the Cancun WTO meeting two years ago, and the very low expectations of progress in the months leading up to Hong Kong. | | |

|Empty gesture? | | |

|The biggest disappointment of the poorest, so-called "least developed countries", was the development package tacked onto the rest| | |

|of the deal. | | |

|The key new element gives them the right to sell their goods into developed countries without paying tariffs or being limited by | | |

|quotas. | | |

|But it is too full of exemptions to make a real difference. America is expected to continue to put obstacles in the way of textile| | |

|imports, while Japan has proposed to exempt rice, fish, sugar and maize. | | |

|The offer should, however, allow the poorest countries to sell goods with added value at the tariff-free rate, enabling them to | | |

|develop food-processing industries. At the moment they have to pay high tariffs to sell processed food. | | |

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|Zambia is dependent on the international trading system | | |

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|Some of the least-developed countries were happy that the process was now back on track. | | |

|Uganda's Trade Minister, Gaudi Megeleko, said that there was now "something to build on" before another full ministerial meeting | | |

|early next year to put flesh on the bones of the agreement. | | |

|Developing countries know that they have nowhere else to turn. | | |

|"In the first 10 years of tariff reform and trade liberalisation, we literally deindustrialised Zambia," Zambian Commerce Minister| | |

|Dipak Patel - who led in negotiations for the least-developed countries - said before the WTO meeting. | | |

|"But now we are into it we have no other options. We can't go it alone. We don't have sufficient capital, so we have to rely on | | |

|the multilateral trading system. | | |

|"It is ironic that it has turned out this way but that is our only salvation." | | |



|Last Updated: Wednesday, 26 April 2006, 23:06 GMT 00:06 UK [pic] |

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|EU and US rapped over trade talks |

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|MPs attacked the EU's 'protectionist' stance on farming tariffs | | |

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|The EU's tough negotiating stance could derail talks aimed at liberalising world trade, a | | |

|group of MPs has warned. | | |

|The EU made unrealistic demands that poor countries open their markets while protecting | | |

|their own, said the Commons International Development Committee. | | |

|The MPs also accused the Prime Minister of raising "unrealistic" expectations of a global | | |

|deal to help poor nations. | | |

|Instead it urged the UK to do more to ensure the EU agrees a deal on trade before a key | | |

|deadline slips past. | | |

|The committee added that, despite Tony Blair promising a comprehensive deal to open up trade| | |

|to developing countries during the UK's presidency of the EU last year, World Trade | | |

|Organisation (WTO) talks had achieved only limited results so far. | | |

|'Unrealistic expectations' | | |

|It put the failure down to Mr Blair backing EU negotiating tactics during talks in Hong Kong| | |

|in December 2005 where some nations, such as France, had been determined to protect their | | |

|agricultural interests. | | |

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|[pic]The EU has been the cause of the crisis at the WTO, blocking every pro-development | | |

|proposal | | |

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|John Hilary, War On Want | | |

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|"We accept that there were limitations on what the government could achieve in terms of | | |

|trade during its presidency, but these limits should have been acknowledged earlier on so as| | |

|not to raise the public's expectations of the outcome unrealistically," the committee said. | | |

|It added talks had been hindered by the inconsistent approaches of both the EU and US. It | | |

|attacked America for "shamefully restricting" an agreement on free access to its markets for| | |

|the poorest countries. | | |

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|Peter Mandelson leads the EU in trade negotiations | | |

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|Meanwhile, the EU attempted to "change the rules at half time" by demanding that developing | | |

|nations open up their services market in return for reducing tariffs on farming goods. | | |

|"Neither the Commission nor the UK should be pressing developing countries in this way," the| | |

|MPs said in a scathing attack on the EU and its trade chief Peter Mandelson. | | |

|It called on the government to "pre-emptively" set out what it is willing to agree to in | | |

|order to open up access to its markets. | | |

|"Such action would demonstrate leadership and political commitment to a development round," | | |

|it added. | | |

|The committee chairman, Malcolm Bruce MP, said that so far "what we see is endless wrangling| | |

|around the margins on issues that will not in the end benefit the poorest people". | | |

|The report came days after the WTO admitted it had pushed back key deadline to agree a | | |

|"roadmap" to a trade deal from April to July as major players in the negotiations remained | | |

|too far apart. | | |

|'Cynical' | | |

|The report was welcomed by charities and trade justice groups who said it showed that the EU| | |

|had only itself to blame for the talks hitting a standstill. | | |

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|[pic]What we see is endless wrangling around the margins on issues that will not in the end | | |

|benefit the poorest people | | |

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|Malcolm Bruce, MP | | |

|Chairman, International Development Committee | | |

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|"This report shows that Peter Mandelson has been pursuing an anti-development agenda in the | | |

|trade talks all along," War on Want campaigns director John Hilary said. | | |

|"The EU has been the cause of the crisis at the WTO, blocking every pro-development proposal| | |

|and sticking stubbornly to its own pro-corporate agenda." | | |

|The World Development Movement (WDM), added that the UK had "behaved cynically and | | |

|dishonestly" on trade. | | |

|The best outcome poorer nations could now hope for was that the talks collapsed, WDM policy | | |

|chief Peter Hardstaff said. | | |

|"The talks do not now offer the prospect of a good deal for developing countries, only | | |

|shades of a bad deal," he added. | | |

|The Doha Development Round was launched in November 2001 with the aim of bringing the | | |

|benefits of free trade to poor countries. | | |

|A last-ditch attempt to revive the talks in Hong Kong in December 2005 made only limited | | |

|progress, and time is running out as the US goverment's negotiating authority to make a | | |

|trade deal runs out in July 2007. | | |



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