World Trade: A Scandal That Must End. (Feature)

By Bafalikike, Lokongo | New African, November 2002 | Go to article overview

World Trade: A Scandal That Must End. (Feature)


Bafalikike, Lokongo, New African


"While rich countries make use of heavy farm subsidies, they put pressure on poorer countries not to use them. It adds up to an international 'farmgate' scandal. It is a scandal that must end," says ActionAid. Lokongo Bafalikike reports.

The level of agricultural subsidies in the industrialised nations is having a major destructive impact on developing countries and is widening the gap between the rich and the poor.

"Every cow in the OECD countries is subsidised by $2 a day, while the African human being lives on less than a $1 a day" is how Tony Blair, the British prime minister, famously put it on his trip to West Africa in March this year.

"Farming subsidies in the OECD countries," Blair continued, "amount to $322 billion a year, or equivalent to the total annual value of the African economy." (The OECD or Organisation for Economic Co-operation and Development is made up of 30 countries, mainly European, but also including USA, Canada, Japan, New Zealand, Australia, South Korea and Mexico).

Blair's franc-parler has now been added to by ActionAid, the British NGO, which says in a recently-published report that the impact of existing agricultural trade rules that favour rich countries and large-scale multinational producers, has not only destroyed the livelihoods of millions of small farmers in the developing world but has also generally undermined development in these countries.

Called "Farmgate--The Developmental Impact of Agricultural Subsidies", the report says the US alone pays over $100 billion a year to subsidise its agriculture. The EU follows with $38.5 billion a year--most of which goes to the richest landowners in Europe. "Governments in rich countries," the report adds, "are paying over $300 billion a year to subsidise their agricultural sectors--six times the total amount of aid to developing countries. That is more than enough to feed, educate and provide healthcare for everyone worldwide." It is a veritable scandal, and a "massive breach of faith", the report says, because it does not comply with the spirit of agreements reached during the Uruguay Round negotiations of the World Trade Organisation (WTO) which obliged the rich countries to reduce agricultural subsidies by about 25% by 2001.

Instead, "developing countries have been forced to reduce or eliminate their subsidies under pressure from international donors" [a code for the IMF and the World Bank and the countries that underpin their existence].

Totally disgusted, ActionAid says, "developed countries are practising a double standard--protection for the rich and the free play of market forces for the poor".

According to the report, farm subsidies in the EU and USA have resulted in the following:

* Undermined the livelihoods of poor and small-scale farmers.

* Encouraged over-production, distorted trade and depressed prices.

* Made US and EU farm goods artificially competitive on world markets.

* Resulted in the "dumping" of cheap subsidised produce in poor countries. …

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