The Hindu Business Line : Developing unity

THE NEW DELHI meeting of the select developing nations has succeeded in formulating specific demands which the developed economies will find hard to ignore in the run up to the December ministerial meeting in Hong Kong of members of the World Trade Organisation. The meeting, which brought under one umbrella not just the global grouping of G-21 nations but also the Africa-Caribbean-Pacific countries, reflects a growing realisation among the developing world that the rich WTO members such as the United States and the European Union will otherwise have their way in multilateral trade negotiations by throwing economic carrots to the poorest countries.

Of course, this might still happen, but the fact remains that the New Delhi meeting has made the tactic of fuelling dissension and division in the ranks of the poor countries less potent in the days ahead and that the developed countries now know that they will first have to crack the farm nut if the Doha Round is to make any progress at all. It is worth recalling that at the Kenya WTO "mini-Ministerial" held in early March an attempt was made by the US and the EU to focus on subjects other than agriculture, an attempt that was effectively nipped in the bud by the Brazilian Foreign Minister, Mr Celso Amorim, who underscored the point that the "leadership must be by agriculture because that is why the (Doha) round exists". In fact, the best thing to have happened at the New Delhi meet is the drawing up of the specific demand that the US, EU and Japan eliminate all export subsidies given to their farmers within five years at the latest and also reduce significantly trade-distorting domestic support for farm products. This apart, the G-21 meeting also reiterated its stand that countries in the developed world must convert their specific duties to ad valorem as the key element on market access for non-agricultural products. There had been justifiable fear among the developing countries that the rich nations would try to bypass market-access commitments by backing "inappropriate conversion methodology".

The Union Commerce Minister, Mr Kamal Nath, did well to make the point that any tariff reduction scheme would have to take into account the developing world's concern over "food security, livelihood and rural development", an aspect of life in poor countries which should not be sacrificed at the altar of global trade liberalisation sculpted under the auspices of the WTO. This brings up the issue of differentiation in treatment among developing countries, a sphere that holds potential for those interested in dividing the poor world. Indeed, the ground is fertile, voices already being heard against the emergence of the "five interested parties" — Australia, India, Brazil, the US and the EU — which have taken the initiative in the past to arrive at decisions on behalf of the other WTO members and may do so again in future. Since bearing the mantle of leadership is always difficult, New Delhi should be aware of this pitfall.

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