"In order to restore balance in multilateral trade negotiations, developing countries should calculate the impact of concessions they are being asked to make in other sectors, judged against actual, concrete openings they obtain in the agricultural sector. If the latter are not commensurate with specific measures and liberalization sought in other sectors, this will further aggravate the existing imbalance, which dates back to the inception of the multilateral trading system". This was a key message delivered today by Rubens Ricupero, Secretary-General of UNCTAD, to the opening of an Expert Meeting on agricultural trade issues in Geneva.
In his remarks to a large gathering of 150 experts from 85 countries, as well as representatives from 16 intergovernmental and non governmental organisations, Mr. Ricupero stressed that attention needed to be paid to the developmental impact of trade negotiations. In the agricultural sector, he singled out the "extremely pernicious effect of export subsidies in highly industrialized countries, equivalent in some cases to four or five times the production cost".
The three-day meeting in UNCTAD (26-28 April) will examine trade in the agricultural sector with a view to expanding the agricultural exports of developing countries, and assisting them to better understand the issues at stake in the upcoming agricultural negotiations.
Participation of experts from 20 developing country countries, six of them least developed countries (LDCs), at this meeting was helped by a decision taken by the UNCTAD Trade and Development Board last year on financing the participation of developing country experts in UNCTAD’s expert meetings. This was the first meeting for which funding had been made available for this purpose.
At the opening session, both Mr. Ricupero and the Chairman, Mr. Sandor Simon (Hungary), stressed that the meeting was not a stage for negotiations. Rather, it was an opportunity for experts to exchange views freely and analyse issues in the area of agricultural trade, on the basis of country experiences and from a developmental perspective.
Mr. Ricupero pointed out that issues relevant to developing countries needed to be formulated into proposals for a positive negotiating agenda to be submitted to the WTO General Council before August. It would be valuable, he said, if the meeting could examine the implications for developing countries of the expiry in 2003 of the so-called "peace clause" (Article 13 of the Agreement on Agriculture), that would set in motion the progressive extension of the Agreement on Subsidies and Countervailing Measures to the agricultural sector.
Mr. Ricupero explained why careful attention should be paid to the developmental impact of agricultural reform in the upcoming trade negotiations. While the agricultural sector generated trade of US$580 billion in 1997, or only about 11 per cent of world merchandise trade, it was of vital importance to many developing countries. In low-income countries it accounted, on average, for 30 per cent of GDP, and for over 70 per cent of employment (compared to, respectively, 1.5 per cent and less than 5 per cent in high-income OECD countries). It was necessary, he said, to make a distinction between the social impact of the outcome of trade negotiations on countries, according to the percentage of the labour force that was employed in the agricultural sector.
The UNCTAD Secretary-General posed four specific questions that would benefit from an examination by the experts. One related to the lack of tangible benefits flowing from the Marrakesh Ministerial Declaration on LDCs and net food-importing countries, especially in the light of declining food aid. He suggested that positive action be taken in this regard by agreeing on operational commitments and technical assistance.
A second question related to the dominant role of large transnational enterprises in the world-wide production, marketing and distribution of some agricultural products. Much of the benefits of trade in valued-added agricultural products had been captured by highly industrialized countries, not by the producing countries. It was necessary to examine how the supply capacities of developing countries in higher value-added products could be improved.
Third, there was need for a country-by-country examination of actual experience under the "special and differential treatment" clause for developing countries. "In fact", Mr. Ricupero stated, "a major drawback of the current review process is that it lacks a framework for systematically examining such questions of special and differential treatment".
Finally, developing countries should consider how to increase their capacity to use the provisions of the Agreement on sanitary and phytosanitary (SPS) measures. Many had seen exports refused entry to markets because of alleged non-compliance with the SPS regulations of importing countries. Cases of successful challenges to bans by importing countries on these grounds were rare.