Expert skeptical about new trade ‘package’

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Rethabile Pitso

Trade expert Nkareng Letsie believes decisions made early this month during the 10th World Trade Organisation (WTO) Ministerial Conference in Kenya would not be of much benefit to Lesotho.

The conference, held from 15-18 December, culminated in the adoption of the Nairobi Package, which was a series of six decisions on agriculture, cotton and issues related to Least-Developed Countries (LDCs) as well as multilateral trade. The decisions included a commitment to abolish subsidies for farm exports, which WTO Director-General Roberto Azevêdo hailed as the “most significant outcome on agriculture” in the organization’s 20-year history.

Other agricultural decisions covered public stockholding for food security purposes, a special safeguard mechanism for developing countries, and measures related to cotton. Decisions were also made regarding preferential treatment for LDCs and the criteria for determining whether exports from these countries may benefit from trade concessions.

However, Mr Letsie—the Policy Analysis and Research Institute of Lesotho and Consumer Protection Association of Lesotho International Trade Expert—believes there is little hope the Nairobi Package would yield any positive results for Lesotho given the WTO’s record of reneging on commitments made towards emerging economies.  The WTO regulates trade between participating countries, provides a framework for negotiating trade agreements, and a dispute-resolution process aimed at enforcing participants’ adherence to its agreements.

“Civil Society Organisations (CSOs) value the World Trade Organisation for affording both developed and least-developed countries, a platform to negotiate trade-related matters as equals. There is a one-vote policy for each country regardless of how powerful it might be.

“But despite this, we believe developed countries are getting priority over LDCs, which gives them more access to trade benefits than their least-developed counterparts.

“I am making this observation in light of the fact that the WTO has been dragging its feet towards finalising negotiations under the auspices of the Doha Development Agenda (the DDA commenced in November 2001 with the objective of lowering trade barriers around the world, and thus facilitate increased global trade). Multilateral Economic Diplomacy is facing serious setbacks across the board with regard to global imbalance, financial architecture, environmental standards and trade. In light of the DDA round of negotiations, what developing countries like Lesotho can be proud of are the Bali agreements which focused extensively on developing the LDCs in as far as trade facilitation was concerned with regard to customs procedures,” Mr Letsie said.

“When the DDA was established, it sought to ease trading in agriculture, and NAMA (Nan-Agriculture Market Access). These are the mainstays of developing countries’ economies. The Bali agreement fragmented progress under the DDA but failed to advance broader liberalisation. The agreement, on the other hand, put more focus on easing LDCs trading in non-agricultural products. Both negotiations have not been seen to the end with most LDCs still failing to tap into developed countries’ markets because of delinking issues. For example, the link that was not established between agriculture and trade facilitation, evidenced from the average of OECD (Organisation for Economic Co-operation and Development) tariffs on imports from developing countries which is higher than that existing among developed countries. Irrespective of those challenges, the WTO has still not made efforts to construct policies that would enable ease of trade to that effect.”

Mr Letsie pointed out that the concerns he was raising were shared by most Civil Society Organisations (CSO) which submitted them to the WTO, through a petition, ahead of the Nairobi conference. The CSOs were simply urging members to prioritise the trade concerns of LDCs, he added.

On 9 December, 453 CSOs, among them trade unions, environmentalists, farmers, development advocates, and public interest groups from over 150 countries, petitioned the world trade body to express “extreme alarm about the current situation of trade negotiations in the WTO”.

In Lesotho, the petition was signed by organisations such as the Consumer Protection Association, Rural Self Help Development, Policy Analysts and Research Institute of Lesotho, Patriot Vision and Action, and the Lesotho Council of Non-government organisations.

Mr Letsie said the petition further sought to urge the WTO to forge actionable plans during the Nairobi conference with particular attention towards achieving the United Nations’ Sustainable Development Goals (SDGs). On 25 September this year, the global community adopted a set of 17 goals aimed at ending povertyprotecting the planet, and ensuring prosperity for all as part of a new sustainable development agenda. Each goal had specific targets to be achieved over the next 15 years. SDGs were a continuation of Millennium Development Goals (MDGs) established following the Millennium Summit of the United Nations in 2000. Under the MDGs, member-countries and international organisations committed to eradicate extreme poverty and hunger; achieve universal primary education ; promote gender equality; reduce child mortality; improve maternal health; combat HIV/AIDS, malaria, and other diseases; ensure environmental sustainability and develop a global partnership for development by 2015. However, with most countries yet to achieve all the targeted goals, the SDGs were agreed upon by UN member-countries and key stakeholders.

“The common challenge we are facing as LDCs regards the implementation of SGDs which provide for universal access to public health, education, eradication of poverty and food insecurity. The last two are intertwined with the agricultural industry, for instance, the very sectors where we are experiencing trade challenges stemming from lack of supportive trade policies.

“Those CSOs were basically calling for more investment in agriculture and food production towards the success of SDGs in their respective countries.

“Again, at the moment, the public health sector is affected by stringent intellectual property rights, which deny developing countries access to much-needed drugs patented in developed countries.

“LDCs do not have access to the production or distribution of generic drugs because of patents owned by a single country. Although access to generic products is supported by Trade Related Aspects of Intellectual Property Rights (TRIPS) agreements, poor countries do not have the capacity, individually, for compulsory licensing.”

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