Development Lost in WTO Ministerial Text

(Photo: Women's Camp, Victoria Park, Hong Kong)


1. IGTN Statement 18th December

2. Women's Edge Anlaysis of Outcomes

IGTN Analysis of Draft text 18th December

The latest draft Ministerial Declaration (18 December 2005 – Ref 05-6190) will ensure that the global trading system works for the development of corporate profits and shareholder earnings – not developing country economies and their people. The text has clearly been written by the most powerful countries for the promotion of their corporate interests and will only exacerbate the existing inequalities between countries, between people, and between men and women. Developed and developing countries are not equal trading partners and this revised text has proven this once again. The most developing countries will go away with is a handful of protective commitments in Agriculture (eg. para 5 on effective cuts in trade distorting domestic supports and para 7 on the designation and treatment of Special Products and Special Safeguard Mechanisms) and NAMA (eg. para 15 reference to para 8 of NAMA Framework and para 17 on non-linear mark-up approach), but are being penalized with Annex C’s expansive escalation in services liberalization.

Overall, the balance between Special and Differential Treatment and Market Access remains skewed in favor of market access formulas and modalities favorable to the developed countries. Developing countries are once again being asked to trade away their citizen’s livelihoods, food security, jobs, education and health and the policy space to address ensure these fundamental human rights in exchange for meager concession.

Services: The inclusion of Annex C that aims to “expand(ing) the sectoral and modal coverage of commitments and improving their quality” will undermine whatever gains were had from protective measures in Agriculture and NAMA. Annex C (para 27) creates plurilateral negotiations on a sectoral and modal basis and provides an almost immediate deadline for completing final draft schedules by October 31, 2006. This is an escalation in services liberalization and therefore privatization which will threaten many women’s livelihoods and lives. Access to essential services like water, education, health is crucial to women’s development and cannot be guaranteed when profit maximization is the bottom line.

NAMA: The agreement on the use of the Swiss formula (para 14) for the elimination of tariffs in Non-Agricultural Market Access (NAMA), despite the open language on the number of coefficients, paves the way for rapid de-industrialization leading to higher levels of unemployment and dramatic loss in tariff revenues—on which many governments depend.

LDC Development Package: LDC’s have been offered a hollow development package which will allow developed countries to limit duty free quota free treatment to only 97% of LDC goods and thereby deny market access to the very products which are of specific export interest to LDCs (Annex F(36)(a)(ii)) and which could improve the livelihoods of millions of farmers-over 60% of whom are women-and workers. Furthermore, aid-for-trade offers are not backed up with money in the bank, could be given in the form of loans (plunging LDCs deeper into debt), and will likely be restricted to the sole purpose of trade facilitation and not broader social and economic development projects which can be crucial to the realization of women’s economic and social development and equality.

Agriculture: 2013 is too late for the ending of developed country export subsidies (para 6). In a world where life expectancies in least developed countries average 50 years, the world cannot wait! If the commitment to Special and Differential Treatment for developing countries is too be honored, developing countries cannot be lumped together with developed countries in the third band for the reduction of domestic supports (para 5). Cotton is a crucial issue and while export subsidies for cotton will be eliminated and duty and quota free access granted to LDC cotton – domestic support reductions remains bracketed (para 11). Furthermore cotton will only be addressed within the context of full agricultural negotiations (para 11).

IGTN urges developing countries to REJECT the TEXT!


WTO Meeting in Hong Kong: What's in it for Women?

Last month, the countries of the World Trade Organization (WTO) met in Hong Kong from December 13-18, 2005 to revitalize and push forward the ‘Doha round’ of trade talks. Their challenge was to ensure that the needs of developing countries were kept at the core of the negotiating agenda, as was promised at the beginning of the round in 2001. After Hong Kong, most issues remain unresolved, and negotiations will continue through 2006.

WTO member countries did come to agreement on certain issues that will have implications for poor women around the world. For example, developed country governments agreed to eliminate farm export subsidies by 2013 and cotton export subsidies by the end of 2006. Export subsidies, which are not commonly used, are specifically designed to encourage the export of certain goods. Many governments, however, provide other forms of domestic support, such as direct payments to farmers, and the reduction of these subsidies has not yet been addressed by WTO members. Agricultural subsidies have been widely criticized internationally because they can artificially lower the prices of farm exports from rich nations, making it difficult for farmers from developing nations to compete. Ending subsidies could affect women’s lives, both as producers and as consumers of food. Women, in fact, produce 60 to 80 percent of the food grown in poor nations, but tend to be small or subsistence farmers who usually do not export their goods.

The United States and other developed country governments also agreed to improve duty- and quota-free access for exports from least developed countries (LDCs). By 2008, they will grant such access for 97 percent of products, or tariff lines. As a result, some women exporters in LDCs will be better able to compete in the U.S. market, because the majority of products will not face the discrimination of tariffs or quota limitations. Many LDCs already have duty-free access to the U.S. market under other preference programs, and, while the new proposal would increase market access opportunities for LDCs, certain products, such as textiles and apparel, will likely remain subject to customs duties.

Developed countries also committed to higher amounts of ‘aid for trade’ in Hong Kong, with the United States committing to increase its annual trade capacity building assistance (TCBA) from $1.3 billion in 2005 to $2.7 billion by 2010. Trade Capacity Building Assistance is international assistance given to poor or transitional countries to help them participate in global trade and can include the training of trade negotiators and help to small businesses on how to export their goods. The international community has come to realize that without such assistance, trade liberalization alone will not necessarily bring about economic development. While it is important that increased TCBA does not come at the expense of reductions in other forms of development assistance, in the future, Trade Capacity Building Assistance could be used to directly help poor women in developing countries take advantage of the opportunities that trade has to offer.

Looking ahead, the current Doha round is expected to conclude at the end of the year. Yet there is much more to be done in order to make this round a true ‘development round,’ as it was initially billed. WTO member countries could go much further this year in creating real economic opportunities for women, who are the majority of the world’s poor. For example, greater reform of international agricultural markets and increased market access for textiles and apparel could improve women’s livelihoods. Apart from being the majority of the world’s agricultural labour force, women account for the majority of textile and apparel workers in many developing countries. The latter is especially true in Asia, where, according to the International Labour Organization, women account for 89 percent of the textile and apparel sector in Cambodia, 80 percent in Bangladesh, and 82 percent in Sri Lanka. If the promise of the Doha round is to be fulfilled, it is important that women like them see more of the benefits of trade.

See Women's Edge Coalition website: www.womensedge.org