APPENDIX 17
Memorandum submitted by the UK Food Group
(S 26)
The UKFG is a network of non-governmental organisations
from a broad range of development, farming, consumer and environment
groups, based in the UK but with strong international links especially
with partners in the South. Members endorsing this memorandum
include:
Agricultural Christian Fellowship, Catholic
Fund for Overseas Development, Catholic Institute for International
Relations, Christian Aid, Farmers' World Network, Gaia Foundation,
Intermediate Technology, Save the Children Fund, Susila Dharma
International, World Development Movement.
The UK Food Group welcomes this opportunity
to submit evidence to the Agriculture Committee. A number of the
UK Food Group's member organisations may have also responded with
their own memorandums. This memorandum addresses the implications
of EU agriculture on food security in developing countries.
INTRODUCTION
More than 800 million people, mostly in developing
countries, do not get enough food of sufficient quantity or quality.
They lack secure physical and economic access to food. Sustainable
food supplies require that national and international agricultural
and trade policies prioritise food security.
Current trade liberalisation is pressurising
Southern countries to intensify their agriculture, producing a
bias against small farmers in favour of larger producers, transnational
agribusiness and export crop production. Trade liberalisation
has thus been accompanied by growing land alienation, declining
food entitlements, a growing number of hungry people, and erosion
of agricultural biodiversity. The UK Food Group is calling for
the institutionalisation of food security within the Agreement
on Agriculture (AoA) which requires addressing a number of broad
areas including reducing the impact of EU subsidies on the agriculture
of developing countries, improving access for developing country
exports to the EU, meaningful special and differential treatment
for developing countries and implementation of the Marrakech Ministerial
Decision.
WTO rules present developing countries with
substantial barriers to achieving food security, as while the
EU and other developed countries advocate open markets they maintain
high protection and subsidies for their own agricultural and food
sectors. The WTO rules are currently stacked against developing
counties:
— They deny developing countries the
use of the very support measures (import controls and producer
subsidies) which enable the EU and US to develop their farming
sectors;
— Developed countries have exploited
the ambiguous nature of commitments in the AoA, such as the changes
in tariff levels on sensitive commodities (a recent World Bank
study has indicated that in some developed countries base tariffs
on rice are up to 207 per cent higher than the actual tariff equivalents
of all border measures which existed in 1986-88)[13];
— Most of the allowable agricultural
support measures are beyond the financial or technical resources
of many developing countries (for example, direct payments to
farmers that do not directly affect market prices or public stockholding
for food security);
— Special and differential treatment
provisions for developing countries, meant to recognise their
particular problems, are currently mostly non-binding and amount
to little more than longer transition periods;
— Non implementation of the Marrakech
Ministerial Decision to provide for compensation to net food importing
developing countries has never been implemented despite a 68 per
cent increase in the cost of their cereal imports in 1995;
— The Trade Related Intellectual Property
Rights agreement (TRIPs) does not specifically recognise the rights
of local communities to their traditional and indigenous knowledge
and this could lead to the unjustified patenting of their agricultural
biodiversity by foreign corporations.
THE UK FOOD
GROUP'S
RECOMMENDATIONS
1. A Meaningful Official Review of the Agreement
on Agriculture
Under Article 20 members agreed to take into
account; the experience of the reduction commitments, the effects
of these commitments on world trade in agriculture, non trade
concerns, special and differential treatment for developing countries
and the objective of establishing a fair and market-orientated
agricultural trading system.
To ensure compliance with Article 20, the UK
Food Group is calling for a comprehensive impact assessment of
the AoA at the national level, with support from the WTO secretariat,
FAO and UNCTAD, with a view to removing its imbalances and unfair
provisions, as well as the specifications in Art 20 this should
include:
— impacts on food security at the local
level;
— participation of civil society; and,
— the costs of implementing the agreements
by developing countries, (many simply cannot afford to put the
systems and institutions in place).
As a contribution to the review a high-level
meeting under the joint auspices of WTO, FAO, UNCTAD and the UN
High Commissioner for Human Rights should be held. Attended by
governments, civil society and intergovernmental organisations,
this should discuss the impact assessment of the AoA. The meeting
should be preceded by a series of national debates involving government
and civil society. Impact assessments and the high-level meeting
to consider the impacts should be conducted before any new negotiations
take place.
2. Domestic Support: Establish a Food Security
Box
Food Security and sustainable development must
be the priority for the AoA, and should be mentioned in the preamble
of the agreement as a central objective to be further developed
in a "Food Security Box". The measures in this box should
be targeted at those developing countries who cannot afford to
support their agriculture but need to protect indigenous, vulnerable
small scale producers to ensure their food security—for
instance through the use of border measures. The Food Security
Box, like other existing exemptions (like the Green and Blue box),
would be a series of exemptions to the AoA for developing countries
whose agriculture was not meeting basic food security needs. A
Food Security box would allow developing countries and net food
importing countries to further their food security by protecting
their own agricultural sector and markets and exempting them from
the WTO demands of minimum market access, tariffication/reduction
of tariffs, and allowing them to increase domestic support for
agriculture until they have achieved a greater level of food self-reliance.
In addition, (and in conjunction with a Food
Security Box) the UK Food Group recommends improving and simplifying
the safeguards developing countries can use against cheap imports—to
allow Special Safeguards Clauses (SSG) for a selected number of
basic food commodities, which are important for a developing country's
food security.
3. Improve Market Access
High, complex tariffs continue to be a major
barrier to market access for developing countries. WTO developed
country members should seek to improve and simplify market access
for agricultural exports specifically from developing countries
by significant reductions in tariff peaks and bound tariffs and
end tariff escalation to enable developing countries to increase
value-added agricultural exports. The use of special safeguard
provisions by developed countries against the imports of developing
countries should be severely restricted.
4. Eliminate Exports Subsidies
The provision of export subsidies by developed
countries has resulted in situations where developed country products
offered for sale in the markets of some of the poorest countries,
have been sold below the cost of production and significantly
cheaper than agricultural produce of the host country. The net
effect is to undermine domestic agriculture production in developing
countries, to increase dependency on a "cheap" subsidised
and often unsustainable food system. (This definition of export
subsidies covers other instruments such as export credit guarantee/insurance
programmes instigated by other developed countries.)
5. Implementation and Reform of the Marrakech
Decision
One reason why net food importing developing
countries (NFIDCs) and least developed countries (LDCs) are concerned
with losing the benefits of export subsidies and thus cheaper
food is due to the non-implementation of the Marrakech Decision.
Enhancing the food production capacity of NFIDCs and LDCs must
be a priority and export subsidies should not be maintained on
the basis that NFIDCs and LDCs rely on them.
At the Marrakech Ministerial in 1994, WTO members
recognised that the NFIDCs and LDCs would need assistance during
the liberalisation process for adjustment purposes. The decision
promised financial support to ensure adequate food imports could
be maintained and to improve agricultural productivity and infrastructure,
together with food aid so that the NFIDCs and LDCs were compensated
for the fluctuations in market price and also to build up their
self-reliance. However, the Marrakech Decision, has never been
implemented despite significant fluctuations in international
prices, reduction of public stockholding by some 60 per cent and
a 47 per cent increase in NFIDC cereal import bills between 1993-94
and 1997-98.
The Marrakech Decision should be revised to
incorporate:
— Utilisation of market-based mechanisms
to automatically trigger assistance at times of high prices/low
domestic production;
— Assistance subject to regular WTO
notifications and remedial action within the WTO framework and
subject to the dispute settlement process;
— Commitments for the provision of
technical and financial assistance to improve agricultural productivity,
facilitate agricultural development and avoid long-term dependency
in LDCs and NFIDCs;
— Establishment of a fund based on
contributions from the major agricultural exporters to pay for
the supply of staple food items to NFIDCs at concessional prices
at times of high prices.
6. Transboundary Movement of Genetically Modified
Organisms (GMOs) to be Addressed at the Convention on Biological
Diversity
The UK Food Group welcomes the agreement of
a Biosafety Protocol under the Convention on Biological Diversity
(CBD). The UK Food Group is aware that there remains pressure
from the United States to address the issue transboundary movement
of GMOs at the WTO. The UK Food Group believes that the CBD is
the correct and most appropriate forum in which to agree biosafety
regulations, especially as GMOs could have a profound impact on
biodiversity and agriculture. Regulations must not simply facilitate
trade in GM products but must take into account the precautionary
principle and consider the possible risks to human health, the
environment, social and economic factors and cultural issues.
The UK Food Group is therefore opposed to the WTO acquiring competence
in this area.
7. Requirement for Anti-Dumping Provisions
and Competition Policy
Dumping—the sale of goods on world markets
at less than the cost of production, is increasingly a problem
for developing countries (and the development of agriculture and
related industries in those countries). For example, UK based
grain companies pay US farmers less than the cost of production
for their crops which is then sold on the international market
at below the US domestic price, competing unfairly with developing
countries exports.
Dumping by private corporations is unregulated
by international agreements. The situation is made worse by the
current trend in agricultural trade of commodity companies merging
with agricultural input companies (seed and chemical) creating
the existence of a few multi-national companies which buy, store,
ship and process the products. The potential for abuse of their
market position through monopolies and oligopolies is obvious.
Therefore the UK Food Group recommends that
competition policy and dumping in agriculture must be addressed
in any discussions on agriculture at the WTO.
8. Exclusion of Agricultural Resources from
Patentability with Trade Related Intellectual Property Rights
Agreement (TRIPS).
The UK Food Group considers that patents and
other intellectual property rights protection on genetic resources
for food and agriculture decreases farmers access to seed, reduces
efforts in public plant breeding, increases genetic erosion, prevents
seed/plant sharing and puts poor farmers out of business.
The UK Food Group believes that WTO members
should:
— Support an amendment to the TRIPS
agreement (Art 27.3 (b)) that would enable WTO members to exclude
all genetic resources for food and agriculture from the TRIPS
agreement.
— Recognise traditional knowledge,
bio-innovations and practices of indigenous people and farming
communities, and
— That the Convention on Biological
Diversity, take precedence over the WTO TRIPS agreement. In provisions
relating to the requirement for prior informed consent of peoples
and communities be sought before utilisation of their knowledge
of plants and that benefits from any commercial exploitation is
equitably shared with these communities (ART 15).
9. Other Issues
9.1 Meaningful capacity building for developing
and least developed countries
This has to go beyond providing technical assistance
to implement agreements and the provision of often highly paid
consultants to advise governments. One of the concerns of developing
country missions in Geneva is the need for capacity building from
the local level upwards to enable effective engagement in the
multilateral trading system. Instruments to achieve this could
be:
— Round Table meetings under the integrated
framework for trade-related technical assistance to least-developed
countries.
— Financial support (bound at the WTO)
for developing countries to meet the cost of implementing the
AoA.
9.2 Increased Civil Society Participation in
the WTO Process
There is a need for greater transparency about
the policy making process at the national level and to increase
civil society participation in the WTO process, particularly in
the South. Measures should include de-restriction of WTO documents
and greater discussion of the WTO process in member parliaments.
21 March 2000
13 Policy Research Working Paper "Agricultural
Trade Liberalisation in the UR", World Bank 1995. Back
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