The Hindu Business Line : Third-party certifying NGOs — A blow to WTO's Hong Kong ministerial?

The rich nations appear to have shifted serious business from the WTO ministerial negotiating table to a forum of third-party certifying NGOs. The Singapore agenda is back even before headway is made in the matter of respecting the national commitments on farm subsidies contained in the Marrakesh agreements and market access conditions are cleared. Sharad Joshi wonders about the fate of the Hong Kong ministerial, scheduled for this year-end.

With NGOs being roped into farm produce certification, the richer countries have arrived at an effective way of pushing the Singapore agenda, of cheap labour, environment, etc., at the Hong Kong WTO ministerial.

THE Agreement on Agriculture (AoA) of the World Trade Organisation (WTO) has been an irritant at post-Marrakesh ministerial negotiations. The AoA has also provoked much hostility by non-governmental organisations that have the resources to collect massive crowds of privileged employees who feel threatened by competition and by open trade. The AoA remains the bone of contention at the meeting in progress at the WTO headquarters in Geneva and will be the major obstacle to the Hong Kong ministerial, scheduled for end-2005.

It is generally considered that the level of subsidies to agriculture and the environment of access to markets are the principal points of disagreement in the WTO. Those closely in touch with agriculture admit that conformity with the Marrakesh stipulations is a major issue. They have also been aware of the fact that subsidies and quantitative restrictions are not the only impediments to globalisation of agricultural trade but that there is an increasing tendency to use non-tariff/trade barriers and even the SPS (sanitary and phyto-sanitary standards) as instruments of protection.

These non-trade barriers pose particularly serious problems because it is difficult to bring them to the negotiating table and even more difficult to establish recourse to these measures. None of the WTO member-countries has the official machinery to judge the quality of its own products, much less the traceability of agricultural commodities. Obviously, the member-countries have even less intelligence on the situation of other members that would enable them to argue against recourse to non-trade barriers by competitors. In India, even the basic infrastructure for examining the quality and the safety standards does not exist. A farmer has no means of ascertaining, in a scientific manner, the grade and the quality of his own produce. The network of laboratories that the WTO presumes simply does not exist. A farmer wanting to export has little knowledge of the standards expected in the destination country.

Even the legislative apparatus for creating the infrastructure for the assessment and implementation of quality and safety standards of food is not in place. The `Agmark' is entirely voluntary. The structure of the Prevention of Adulteration Act is very erratic and inefficient. Most advanced country members of the WTO have well-set and well-oiled Food and Drug Administrations. However, there has been a general lack of confidence in the official machinery responsible for the control of safety standards in most countries. But the vacuum is being filled by NGOs of self-professed competence and expertise. NGOs carrying on a campaign against biotechnology have been in existence even in India for quite some time now. The rich countries have correspondingly well-to-do NGOs. Some of them have started third-party verification of the quality of agricultural produce. And they are also joining hands to form a world-wide network. Given the importance attached to environmentalism, the certification by some of these networks is becoming respectable all over the world.

Some of these NGOs have gone on to establish a verification system that allows them to endorse the products of a whole brand. Each banana of the world-famous `Chiquita' brand now carries, alongside the familiar blue label, a green one representing the certifying NGO. In Europe, one NGO, Europgap, has established comprehensive standards of Good Agricultural Practices (GAP) and is building up similar GAP Groups in other regions and countries. Understandably, it provides an attractive proposition for many countries that have little infrastructure and are not chauvinistic about a certification system of their own.

If that were all, the emergence of NGOs as third-party certifying agencies could be construed as consistent with the current trend of privatisation so that the health and safety standards of food and drugs finally passes on to the non-governmental sector.

The NGOs, in general, are non-profit outfits, relying on donations and funds from benevolent and charitable foundations, individuals and, sometimes, government agencies. In this case, of course, certification represents a highly remunerative business. Even these mundane aspects can be overlooked on the premise that, in the long run, the government machinery becomes even more expensive. But, more important, can the private NGOs be depended upon to be fair and impartial in certification? Further, given the fact that the certifying NGOs would be competing amongst themselves for this lucrative business, are they likely to behave like any food inspector of a governmental agency? This new category of NGOs takes its work seriously. The NGOs scrutinise not only the quality of the finished product but go into their antecedents. They are not satisfied examining only the chemical residues in the final agricultural product. They insist on going into the gamut of agricultural practices employed on the farm to be sure that the product certified is not susceptible to any environmental, economic or social malpractice.

For example, they would refuse to certify an agricultural commodity if the production process could harm the environment. Equally, they would deny a product a certificate if farm labour is underpaid or otherwise subject to economic exploitation, or where child labour is employed and women do not have access to amenities for risk-free pregnancy and child-birth.

One thought that the Singapore ministerial agenda of discouraging child labour and environment-destructive processes were set aside at the Doha Ministerial conference. Rather than push it further across the negotiating table, the richer countries appear to have found an ally in the NGOs, which have put paid to every ministerial since Seattle.

In certification, the NGOs have found a more lucrative line of activity and the richer countries an effective way of pushing the Singapore agenda on cheap labour, environment, child labour, etc.

Just when all eyes are set on the Hong Kong ministerial, the United States and Europe are making some highly publicised gestures about reducing the level of domestic support to farmers. It would appear that the rich nations have already shifted the venue of serious business from the ministerial negotiating table to this forum of third-party certifying NGO agencies.

The Singapore agenda is back and kicking even before formal headway is made in the matter of respecting the national commitments contained in the Marrakesh agreements on farm subsidies and market access conditions are cleared.

(The author is Founder, Shetkari Sanghatana and Member of Rajya Sabha. He can be contacted at sharad.mah@nic.in)

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