The U.S. and the European Union Reach a Compromise to Save the WTO
The U.S. and the European Union (EU) have cobbled
together a framework agreement on agriculture, the text of which was accepted
unanimously July 31 in an effort to save the current round of World Trade
Organization (WTO) negotiations on trade liberalization.Without an agriculture agreement, many had
predicted not only the collapse of the current Doha round of negotiations but of the WTO
itself.
The way in which the agreement was struck
leaves no doubt as to the motivations behind it: it is a blueprint for how the
European and American imperialists intend to ensure continued domination of the
economies of Latin America, Asia and Africa while keeping at bay the emerging
powers of Brazil, India and China.
The biggest stumbling block in the
agricultural negotiations all along had been the refusal of the EU and
Americans to eliminate their export subsidies on agricultural products.These subsidies have nurtured the corporate
farm monopolies, such as Cargill, ADM and ConAgra (based in the U.S.), and Bunge
and Louis Dreyfus (based in Europe), and have also allowed both the
Americans and the Europeans to dump food into the world market at drastically
reduced prices.The U.S. in particular is famous for disposing of
production surpluses under the guise of food aid, a policy that has destroyed
attempts, especially in Africa, to nurture local agriculture.African farmers have simply not been able to
compete with food and livestock sold into their own markets at prices far below
the cost of production.
Before the agriculture agreement was
signed, both the U.S. trade representative Robert Zoellick and
his EU counterpart Franz Fischler stressed the importance of getting a deal
through.They began to plant leaks in
the media about the major concessions they were making in order to get
developing countries on side. In addition, they engaged in a campaign of
intimidation and arm twisting of smaller nations that were protesting different
aspects of the text.According to media
reports, at one point representatives from a number of African nations simply
walked out of the talks, appalled that the U.S. was refusing to reduce its cotton
subsidies despite over a decade of promising to do so.One by one, though, they returned to the
table after intense negotiations with U.S. government officials.
The “historic compromise”, as Zoellick
described it, calls for immediate reductions in export subsidy programs in both
Europe and the U.S.This language is reported to be what won over India and Brazil.However, the language on reductions to domestic support payments is
quite vague.Using an army of trade
lawyers and negotiators, the Americans and EU simply had the majority of their
export subsidy programs reclassified as domestic support programs and signed on
the dotted line.
Within a week of the agreement being
signed, Zoellick was openly bragging to U.S. politicians there would be virtually no
impact on American farm subsidy programs.His comments were echoed by the French agriculture minister.At the same time, both the U.S. and EU won major concessions from
smaller countries for the removal of some of the existing tariffs on food
products, which means that any remaining programs designed to encourage the
growth of local agriculture will be discontinued.
Canada’s role at this round of negotiations was
quite shameless; it acted in cooperation with the U.S. to pressure smaller countries to accept
an agreement that will further devastate their economies.Canada also signed the agreement despite the
fact that it opens up for future debate the right of farmers to market
collectively, essentially opening up the grain industry for complete takeover
by American agriculture monopolies in the years to come.
The talks also revealed the weakness of
the anti-imperialist forces; when the previous WTO negotiations broke down in Cancun, many tried to claim this was because of
the positive role played by countries like Brazil and Venezuela.However, as these latest negotiations show, the real contradiction in Cancun was between the American and European
imperialists, who have, for the time being, managed to reach a compromise.