The collapse of global trade talks is bad news for Africa, condemning the world’s poorest continent to an uncertain future of high tariffs and lagging competitiveness, officials and experts said on Monday.
World Trade Organisation chief Pascal Lamy was expected to formally announce the end of the Doha round of talks on Monday after nearly five years of wrangling failed to produce a deal.
The talks, which could take months or years to resume, were launched in 2001 and had been aimed at easing poverty and boosting the global economy — important goals for African countries whose agricultural exports remain largely sidelined by high farm subsidies in the developed world.
”Agriculture has been at the centre of the negotiations, and that was the key to any possible progress,” South Africa’s chief trade negotiator Xavier Carim said.
”For Africa, many of the issues that we hoped to have resolved in this round [will] simply be suspended, perhaps for years. We will continue to face the current difficulties that we have, and we will miss the opportunity to address our developmental concerns. It would not be good.”
Africa went into the Doha round pressing for better market access for agricultural goods, seen as key to improving the livelihood of hundreds of millions of people on a continent where 85% of the population live in rural communities.
But disagreements over farm policy proved the undoing of the talks, with no breakthrough on developing countries’ demands that richer nations slash farm subsidies and lower their agricultural tariffs.
”It is time to have a quiet night and reflect on what has happened. But most importantly we need to realise that we should now look to Asian markets and China since the big boys [Western countries] are not ready,” Erastus Mwencha, general secretary of Africa’s major trade bloc, the 20-member Common Market for Eastern and Southern Africa, told Reuters.
Negotiating for nothing
Charities such as Britain’s Oxfam had argued that Africa should drop out of the negotiations, as they would be unlikely to influence big players like Europe and the United States, where farm lobbies are powerful.
But African officials held on, saying it was only through multilateral negotiations that the continent will be able to win the broad concessions it sought.
Now those hopes appear to be in shambles.
”It looks like countries will [now] have to negotiate bilateral deals with more powerful negotiating partners. For the smaller countries they will be worse off because they cannot bring that much clout to the table,” said Razia Khan, chief Africa economist at Standard Chartered in London.
Some economists said the fallout could be mixed, with some African countries continuing to enjoy preferential access to rich world markets under existing agreements.
”But in the longer run it is bad because the whole system of developed-country protection distorts agriculture in Africa,” said Peter Draper, a trade specialist at the South Africa Institute of International Affairs.
Agriculture accounts for more than a quarter of Africa’s exports, and in some countries commodity exports such as cotton, sugar and tobacco are the chief money earners.
Chileshe Mulenga, the head of the Institute for Economic and Social Research, a Lusaka think-tank, said the talks’ collapse would hobble the export ambitions of Africa’s farmers but could force officials to reform markets closer to home.
”There is also need to develop infrastructure such as roads that will facilitate trade of agricultural produce within countries and in the region,” Mulenga said. — Reuters