“Prosperity for a few, poverty for the lot”, WTO and free trade agreements have failed the people !
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La Via Campesina | 29 November 2021
“Prosperity for a few, poverty for the lot”, WTO and free trade agreements have failed the people !
In a sudden development last Friday (26th November), the 12th Trade Ministerial Conference (MC12) of the World Trade Organization (WTO) – due to take place in Geneva between 30th November to 3rd December – has been postponed until further notice, owing to the pandemic crisis. No date has been set for the rescheduling of the Ministerial Conference. La Via Campesina has, for long, called for a total exit of the WTO from food and agricultural negotiations. Elaborated below is the global movement’s official statement listing out the destructive impact of free trade policies promoted by this multilateral trade body and our insistence for an alternative rooted in the principles of Food Sovereignty.
World Trade Organization (WTO), the loudest among the cheerleaders of global free trade, is struggling to find relevance in a world battered by inequality, hunger, extreme poverty, wars and a once-in-a-century pandemic. Here is a quick report card of the last three decades, a time when WTO featured at the forefront of framing multilateral trade rules to enhance “global cooperation”.
- Today, a handful of transnational companies together control the agribusiness sector : seeds, agrochemicals, fertilizer, genetics industry, food and beverages, and retail groceries. The consolidation among agribusiness giants between 1996 and 2018 has resulted in 60% of global proprietary seed sales controlled by only four firms. Data from 2015, two decades since WTO came into existence, indicate that 80% of the worldwide agrochemical sector remained with only four firms. Six livestock firms share much of the breeding & genetics industry, ten companies almost entirely owned the global processed food and beverage industry, and eight companies controlled retail grocery outlets worldwide.
- Despite this grip of agribusinesses over the global food system, hunger has been on the rise. Over 820 million face hunger today. It has been rising, particularly since 2015, with Africa and Latin America among the worst affected regions.
- Food prices are rising too ! The food price index, which tracks international prices of the globally traded food commodities, stood at 133.2 (for cereals at 137.1) in October of 2021, the highest in a decade !
Interestingly when WTO was set up in 1995, its purported aim was “to help its members use trade as a means to raise living standards, create jobs and improve people’s lives”. That promise has failed in more ways than one.
- Billionaires now have more wealth than 60 per cent of the planet’s population, even as 735 million people live in extreme poverty. Many others are just one hospital bill or failed harvest away from slipping into it.
- Across low-income countries, daily per capita income is less than US$5 and the gap between lower-middle-income and upper-middle-income countries has only widened.
- In 2019, almost one in five, or 20 per cent, of all those employed – did not earn enough to lift themselves and their families out of extreme or moderate poverty.
- According to UNHCR, the number of forcibly displaced people both within countries and across borders due to persecution, conflict or human rights violations has nearly doubled in the last ten years.
- Worldwide debt today stands at $69 Trillion, the highest in human history. Two decades ago, it stood at $20 trillion. At the same time, public services are suffering from chronic underfunding . The latest Social Spending Monitor indicates that at least 26 low-income countries plan to cut public expenditure, up to 8% of GDP.
All these data, a conservative translation of people’s lived realities, confront WTO’s hollow claims of “lifting millions out of poverty”. In short, instead of lifting anyone out of poverty, the only ‘lifting’ the likes of the World Bank, International Monetary Fund, and the WTO seems to have done is for the billionaires. It has also ‘lifted’ tariffs that offer whatever little protection it did to rural food producers and economies of the developing nations.
The 12th Ministerial Conference, whenever that happens, will continue to bat for the elites !
The global free trade regime’s bias towards wealthy nations is apparent in the discussions that are evolving around agriculture in the run-up to MC 12, particularly on the question of public stockholding.
Consider this. A proposal for a permanent solution on ‘public stockholding for food security purposes‘ was tabled at the Bali Ministerial Conference in 2013, with overwhelming support from developing nations. It called for allowing unlimited domestic subsidies on price support given to farmers under public stock-holding programmes in developing and least developed countries. This proposal called for an end to the 10% limit imposed by the Agreement on Agriculture (AoA).
Predictably, the wealthy nations resisted. In the neo-liberal logic, massive subsidies offered by rich countries to their transnational agribusinesses are justified as ‘trade incentives’, whereas the same done by a poorer nation for its small-scale local food producers are derided as “trade distortion”. This proposal for a permanent solution has been under attack from the US, EU, Japan, Canada, and Australia over the last seven years. And these countries, with a history of colonial and imperialist oppression (that has resulted in the poverty the world is witnessing today), can hand-twist the WTO and block any progress in these discussions. Even at MC12, attempts are underway to issue a watered-down version of the “Bali Peace Clause” – an interim arrangement agreed upon while a permanent solution came into force.
The neoliberal trade policies that dominate the global economy today is broken. All it has done is deliver prosperity to the few and poverty to the lot.
At this point, at least 350 regional free trade agreements and more than 3000 bilateral investment treaties (BITs) are in force worldwide. And most free trade negotiations on agriculture and fisheries are inspired by the WTO’s highly problematic Agreement on Agriculture (AoA). This global framework essentially bats for lower import tariffs, domestic subsidies withdrawal, and abolishes public stockholding for food security purposes. For instance, the AoA only allows 39 countries – 17 of them developed and only 22 developing countries – to use a Special Safeguard, that is, the freedom to raise import tariffs when faced with an import surge. A call for a similar mechanism for Least Developed Countries has fallen on deaf ears – yet another example of the power inequity that defines the WTO processes.
The consequences of these boardroom decisions inside WTO are real for peasants and indigenous peoples. A study conducted by the FAO has placed on record significant surges in food imports in poorer nations. It cites the example of Cameroon, Ghana, Honduras, Kenya, Malawi, Mozambique, Philippines, Srilanka, Tanzania, among others, where import surge often stirred the competition between imported and domestic products and led to the fall in domestic price, especially when the two products are substitutes.
Over the last five decades of its existence, global free trade agreements have only delivered more hunger, food riots, farmer suicides, climate crises, extreme poverty and distress migration. These trade agreements laid the pathway for privatization, deregulation and withdrawal of the State’s obligation in delivering essential public services to its people. This has had a devastating impact on rural areas in particular. Women, youth, and children face the extreme brunt, as distress migration forces them to flee their villages and work under sub-human conditions in the cities. Across countries, the availability and quality of public healthcare and public education have suffered immensely over the last five decades, especially in rural areas, thereby denying a right to decent life to women, children and youth.
South Korean farmer Lee Kyung Hae’s desperate act of sacrificing his life, right outside the venue of a WTO ministerial in Cancun eighteen years ago, tragically expressed these crises in rural areas worldwide.
People push back ! WTO and FTAs Out of Agriculture !
India’s protesting farmers, who have been on the streets for nearly a year now, have been calling for a legally guaranteed minimum support price for their produce, among other demands. The agitating farmers also fear that further trade negotiations on the horizon (with the US and EU) threaten their food sovereignty, autonomy and biosafety norms around GM foods.
In Indonesia, Thailand, Japan, the Philippines and South Korea, peasant farmers resist CP-TPP, RCEP, FTAAP-21 and a host of other regional trade agreements being pushed through by global economic powerhouses like the US and China.
In Argentina, Ecuador, Kenya and Zambia, citizens protest against the IMF-induced debt crisis. The EU-Mercosur deal is finding resistance from peasants and civil society organizations on both sides of the spectrum. They point out that in the Mercosur countries, soya, sugar and meat production, for example, is becoming increasingly industrialized, mainly in connection with the aggressive export-orientated model. The Amazonia basin of South America, central to climate and biodiversity worldwide, is forced to give way to this model.
An Alternative Rooted in Food Sovereignty !
What use are WTO and a host of these Free Trade Agreements if they are merely extending a colonial habit of subjugating a majority of the people ? These free trade agreements, often negotiated behind closed doors through opaque processes, are the enduring symbols of imperialism and neocolonialism of the 21st century. The words of Korean farmer Lee Kyung Hae once again ring aloud today :
“..Uncontrolled multinational corporations and a small number of big WTO Members are leading undesirable globalization that is inhumane, environmentally degrading, farmer-killing, and undemocratic…”
This is why La Via Campesina has never believed in reforming the WTO. It is an organization whose founding principles enable the expansion of a new age-colonialism facilitated through trade agreements. What has changed over the years is perhaps the increasing emergence of bilateral and regional media trade agreements that follow the same framework set up by the WTO but are outside of it.
For La Via Campesina – the global peasant movement of peasants, indigenous people, farmworkers, migrants, fishers and pastoralists – the only permanent solution that we have historically advocated for is that WTO and FTAs stay out of any agricultural discussions. Food cannot be subjected to the whims and fancies of a free market where only those who can afford it can eat it.
As a movement spread across 81 countries, La Via Campesina has again called for a trading system founded on the principles of food sovereignty.
We must call for a multilateral trade system that respects political, economic, and social alliance in defence of independence, self-determination and the identity of peoples comprising it. A system built on cooperation and compassion (and not on competition and coercion as practised by WTO currently). A system that gives the world’s people freedom from debt, hunger, conflicts, inequality and poverty. We need a multilateral trade system where people and their social movements are at equal footing with governments in defining the trade rules between countries, and processes of reaching a consensus remain transparent, inclusive and democratic.
WTO & FTAs out of Agriculture ! WTO Kills Peasants !
Solidarity Trade Now ! Food Sovereignty Now !
