Column: Breaking the WTO logjam

Nov 29 2013, 14:52 IST
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SummaryOne of the focus areas at Bali Ministerial would be the peace clause option pertaining to G33 food security proposal

When trade ministers from 159 member states of the WTO meet next week in Bali for the Ninth Ministerial Conference, they would carry the huge responsibility to preserve the integrity of the multilateral trading system, the critical presence of which was recounted many times over during the recent global economic crisis. The institution played a determining role in keeping the markets open: WTO members were unable to use the classical tools of trade protectionism, which had brought the global economy to grief during the Great Depression of the 1930s. However, despite recognising the importance of the WTO, members of the organisation have been unable to enhance its credibility by concluding the protracted Doha Round negotiations. The Bali Ministerial Conference was seen as an opportunity to break the logjam, but this seems increasingly unlikely.

The inability of WTO members to arrive at a consensus appears more galling given that the Bali Ministerial had a relatively light agenda. Only three substantive areas have been included: trade facilitation, a package for least developed countries and a few issues in agriculture.

In the area of agriculture, the proposal that has attracted most attention is the one tabled by the developing countries belonging to G33 (currently has 46 members including Indonesia, India and China). The G33 argued for the inclusion of two sets of amendments in the Agreement on Agriculture (AoA), which, in their view, were necessary for addressing food security concerns in their countries. The first of these amendments was aimed at allowing developing countries to make payments on specific activities to promote rural development and poverty alleviation without being subjected to any disciplines introduced by the AoA.

A second set of amendments was proposed by G33 to modify the existing provisions relating to public stockholding for food security purposes. The first of these said that developing countries should be allowed to acquire food stocks for supporting low-income or resource-poor producers and the cost of so doing will not be accounted for in their total subsidies bill. Secondly, when developing countries acquire foodstuffs from low-income or resource-poor producers for programmes to fight hunger and rural poverty and for providing food to urban and rural poor at subsidised prices, the difference between the cost of acquiring the foodstuff and the external reference price would not have to be included in the AMS. These textual amendments would, therefore, allow developing countries to both support poorer farmers and implement targeted

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