Global perspective Human stories

Trade liberalization may harm poorest States, UN agriculture report warns

Trade liberalization may harm poorest States, UN agriculture report warns

Trade rules to aid poorest countries
The results of renewed negotiations aimed at liberalizing international trade might hurt rather than help the world’s poorest countries unless those nations are given the necessary leeway to protect their food security and essential development needs, the United Nations Food and Agriculture Organization (FAO) has warned.

The results of renewed negotiations aimed at liberalizing international trade might hurt rather than help the world’s poorest countries unless those nations are given the necessary leeway to protect their food security and essential development needs, the United Nations Food and Agriculture Organization (FAO) has warned.

In its annual report on the state of the world’s agricultural commodity markets, released yesterday in Geneva, FAO urged government ministers participating in the revived Doha Round of trade talks to make sure any new rules are compatible with a global target – known as the Millennium Development Goal (MDG) – that calls for the proportion of people living in extreme poverty to be halved by 2015.

The report stated that while economically advanced countries are likely to benefit from further liberalization of the global trading system, and some developing countries are becoming much more competitive as well, others could be left behind.

“Many lower-income countries, especially in sub-Saharan Africa, are less well placed to gain in the short- to medium run from trade liberalization,” it said, pointing especially to those most dependent on agricultural commodities to support their development and efforts to reduce poverty.

Launching the report, the Chief of the FAO’s Trade Policy Service, David Hallam, said it was not surprising that the world’s poorest nations regard trade liberalization “as a threat to their domestic production and food security.”

If tariffs are reduced, there will be increased competition from imported foods for local products, and domestic production systems may not be able to adequately respond, threatening rural incomes and employment levels Mr. Hallam said.

“It is clear that many countries will need to be allowed some flexibility in the implementation of new trade rules, and also to be given assistance, at least for the short term, while they adjust to the new market realities arising from trade liberalization.”

The report called for action to be taken to ensure that the potential benefits from trade liberalization are spread as broadly and equitably as possible, suggesting developing nations be given more training and greater policy advice on how to defend their interests during trade negotiations.

The so-called Doha Round of trade talks, named after the Qatari capital where they began in 2001, stalled last year amid disputes between developed and developing countries over agricultural subsidies.