The UNCTAD XI meet concluded in Sao Paulo in Brazil on June 18 with an
implied message that if attempts fail to further the Doha development agenda
under the multilateral trade arrangement, the best way is to go for more
South-South trade and cooperation under a more comprehensive global system
of trade preferences (GSTP).
The Brazilian president Luiz Inacio Lula da Silva recently referred to "the
emergence of a new trade geography" involving greater trade and economic
cooperation between different countries in different regions.
The signals, therefore, are clear that the Third World need not be much
perturbed if the developed countries do not agree to their proposals for
greater market access, elimination of domestic support and export subsidies
coupled with the demand for special and differential treatment, special
safeguard mechanism and special products for developing countries. The
alternative is there for reaping the benefits of trade for poverty
alleviation and employment augmentation through South-South trade and
economic cooperation.
However, the hopes for putting the multilateral trade system on the right
track for ensuring fair trade, free of distortions should not be given up.
It would be better if the WTO negotiations can be revived after the collapse
of the Cancun ministerial. The developing countries under the banners of
G-20 and G-33 have shown enough flexibility in their positions in response
to the promise by the European Union Trade Commissioner, Pascal Lamy and
Farm Commissioner, Franz Fischler to phase out farm export subsidies
provided other forms of subsidised export competition were also eliminated
and that there is an acceptable outcome on market access and domestic
support. The European Union's promise to phase out export subsidies
definitely
carries enough `ifs' and `buts'.
The UNCTAD XI meet after its successful conclusion on June 18 came out with
two declarations - `The Spirit of Sao Paulo' containing 15 paragraphs and
`The Sao Paulo Consensus' containing 120 paragraphs. The message of both the
documents are the same. The Spirit of Sao Paulo says "while globalisation
has posed important challenges and opened up new opportunities for many
countries, its consequences have been highly unequal between countries and
within countries.......Most developing countries, however, especially
African countries and the LDCs, have remained on the margins of the
globalisation process. They still face major challenges for realisation of
their economic potential and the incorporation of large masses of unemployed
into the productive sectors."
UNCTAD released a study called `Trade Liberalisation and Poverty In India'
which says that if developed countries reduce their hefty agricultural
subsidies, India's farm exports can rise by 13 per cent and lift 400,000
people out of poverty each year. The study also says that apart from trade,
the government's policies and expenditure on social sector need to be
focused to achieve poverty alleviation target. In this context, The Spirit
of Sao Paulo says : "to achieve these results, countries should use the
ability to explore options and maintain the necessary space for policy in
order to arrive at the best possible balance between different approaches in
their national development strategies." The words "necessary space for
policy" are enough a caution for developing countries to be careful in
negotiating Singapore issues which seek to take away the sovereign rights of
national governments.
The UNCTAD declarations apart from expressing genuine concerns of the
developing for furthering the Doha development agenda have pleaded for
safeguarding the interests of landlocked and small island developing
countries within a new global framework for transit transport cooperation in
accordance with the Almaty ministerial declaration and Almaty programme of
action. The declarations also take care of small economies and least
developed countries (LDCs). It notes, "over 50 developing countries depend
on exports of three or fewer commodities for more than half of their export
earnings. the decline and instability of the world commodity prices and
resulting terms-of-trade losses have reduced economic growth in many
developing countries, particularly in economies that are not diversified,
such as the LDCs and the African countries, and contributed to increased
poverty and indebtness."
The UNCTAD XI declarations call for creation of positive synergies between
trade and finance and linking it to development and suggest that trade and
environment should be mutually supportive in a manner consistent with an
open, equitable, rule-based, predictable and non-discriminatory multilateral
trading system. Equal concerns are expressed about different non-tariff and
technical barriers to trade.
The UNCTAD XI declarations are enough go ahead signals for the Third World.
There is a need for more cooperation between G-20 and G-33 for sorting out
issues at WTO and also for more South-South trade and economic cooperation.Financial Express:
