Trade Talks Progress, Enviros Try to Shield Natural Resources

GENEVA, Switzerland, August 2, 2004 (ENS) - World Trade Organization (WTO) talks advanced on Saturday with agreements that will lead to more open markets for agriculture, goods and services, according to U.S. Trade Representative Robert Zoellick. But environmentalists warn the deal establishes an agenda that could threaten people and the environment worldwide by liberalizing trade in all natural resources.

They fear that more liberal trade rules for natural resources will lead to a rush to exploit minerals, forests and fish, depleting resources that are already stretched thin.

The text adopted by the WTO sets the parameters of the future trade in five key areas - agriculture, industrial products, development issues, trade facilitation, and services.

U.S. Trade Representative Robert Zoellick said the reforms agreed in Geneva are "historic." (Photo courtesy U.S. State Department)

One feature of the agreement reached by the 147 member WTO in Geneva Saturday is a pledge to abolish all forms of agriculture subsidies by a future date, still to be negotiated. This has been a longstanding sticking point in global trade talks, as developing world farmers have complained that the competitiveness of their products is impaired in the global marketplace by subsidies offered to developed world growers by their governments.

"We have agreed to make historic reforms in global agriculture trade," said Zoellick in a statement released from Geneva. "We have laid out a course to open markets for manufactured goods. We've agreed to intensify negotiations to open services markets, which now account for more than half of the economies of most countries, developed and developing."

European Union officials were pleased with the agricultural agreement. EU Agriculture Commissioner Franz Fischler said, “Today we got a deal which will boost the world economy, farm trade and the opportunities for poorer countries."

The decision fully recognizes the EU’s fundamental farm policy reforms and ensures that other rich countries make their farm support systems more trade-friendly, Fischler said.

All developing countries will benefit from special treatment, allowing them to liberalize their markets less over a longer period. The world's 50 poorest countries do not have to undertake any commitments.

The United States and African cotton producing countries cut a deal on Friday on a future reduction of U.S. cotton subsidies that they have been seeking since 2003. Benin, Mali, Chad and Burkina Faso, some of the poorest African countries, depend on cotton. They blame Western subsidies on cotton that drive down prices on world markets for losses of about $1 billion a year.

U.S. cotton ready for picking (Photo by David Nance courtesy USDA)

The EU has already abolished all exports subsidies and tariffs for cotton and has undertaken a fundamental reform of its cotton subsidies, eliminating the most trade-distorting support.

In other developments, the WTO members reached a global commitment to harmonize trade distorting farm subsidy programs, to ensure that countries with higher subsidies are subject to deeper cuts. Zoellick says this is "a goal long sought by the U.S. to level the playing field with the European Union and Japan."

"Our new framework would cut allowed domestic support for agriculture more in the first year than during the entire Uruguay Round," he said.

U.S. Agriculture Secretary Ann Veneman was pleased with the outcome of talks so far. "This framework provides a tremendous boost for concluding the multilateral trade negotiations that will further open markets and reduce the barriers for our farm products," she said Sunday.

There will be new disciplines on export credits and, for the first time, on state trading enterprises. And there are provisions to reform customs procedures as goods move across international borders in order to reduce customs costs and streamline the process.

"The package also commits all of us to substantial improvements in market access for all products, an important principle for a diversified farm producer like the U.S.," said Zoellick.

At the same time, the WTO members agreed to preserve food aid programs for humanitarian and development needs.

Still, environmentalists warn that in the rush to secure a deal governments have turned a blind eye to the potential environmental and social implications of the package.

Their concerns revolved around another set of talks in the Doha package known as non-agricultural market access (NAMA) talks.

"In NAMA," Friends of the Earth explains, "all natural resources are effectively on the table for either partial or complete liberalization, with a particular focus at the moment on fish and fish products, gems and minerals."

Logging truck carries British Columbia logs to the mill. (Photo courtesy B.C. Ministry of Forests)

The WTO is considering modification of "the certification of wood products; restrictions on trade in chemicals and viruses put in place for "strategic reasons;" the tracing and labelling of fish and fish products; general import prohibitions for environmental purposes; and packaging, marketing and labeling requirements," says Friends of the Earth.

The environmental organization is calling for a halt to the NAMA negotiations and a "full, independent review" of their potential environmental and developmental impacts.

Friends of the Earth also criticized the "extremely secretive and closed process used for negotiations in Geneva," saying that many country negotiators were kept out of key negotiating sessions and nongovernmental organizations were barred from the negotiating venue.

David Waskow of Friends of the Earth US said, "The WTO process is completely undemocratic, and this framework agreement is the result. If the WTO proceeds on the course just laid out, these negotiations will pose a serious threat to people and the environment around the world."

Still, EU Trade Commissioner Pascal Lamy sees the agreement reached in Geneva as good news for the world. "The Doha Development Agenda is about making trade work for all, and delivering growth and development," he said. "After the setback in Cancun, today's decision shows that the multilateral trading system is alive and kicking. But we have only walked half of the way: we need now to rapidly conclude this round, thus bringing good news to a world economy in need of stimulus."

"Governments are trading away our environment at the WTO," disagrees Alexandra Wandel of Friends of the Earth Europe. "Already today, the WTO is used as a weapon against environmental protection and public health. With this deal, even more environmentally and socially sensitive sectors will be liberalized. Corporate lobby groups will be the big winners, the environment and the poor the big losers."