The WTO - WTF?

This is from Breaking News - I have been meaning to start a thread on this for a few days.

I am hearing a great deal of dissent in Europe from where Mandelson has been taking the WTO negotiations and have the feeling that in not following these negotiations I have my eye off a very big ball. Objectors have said, amongst other things, that the negotiations are based on conditions well before the food crisis emerged.

I haven't seen much reporting in the Press and would really appreciate anyone who knows about this stuff explaining what is going on.

Quote :

Farmers today claimed a proposed agricultural deal at forthcoming World Trade Organisation talks would cost them billions and at least a half-million jobs.
Jean-Michel Lemetayer, the president of the European farmers’ lobby COPA, said EU Trade Commissioner Peter Mandelson was wrong when he claimed that failing to strike a deal in the talks that begin on Friday would shut Europe off from freer global trade.
“No deal is better than a bad deal, and the deal currently on the table is very bad,” Mr Lemetayer said.

The deal would slash farm subsidies and open up the EU to more agricultural exports.

The farmers’ group said European consumers objected to a deal that would make them “even more dependent on imports for their basic food supplies at a time of a world food crisis.”

“An agreement would mean huge losses for European citizens and scarcely anything in terms of gains,” COPA said.

“We challenge Peter Mandelson to name some concrete benefits he has gained so far for European citizens as a result of the negotiations,” it said.

Slashing subsidies and opening up exports would cut European farmers’ incomes by a quarter, COPA said, and cost them some £23bn (€28bn) every year – without seeing gains in other areas.

This is far higher than a European Commission estimate that the farming sector would lose £14m (€17m).
COPA said EU estimates only cover cereals, beef, pork, poultry and dairy, while its figure also includes sugar, rice, sheep and goat meat, fruit and vegetables and eggs.

The group also said Europe’s food processing sector will be badly hit and could lose well over 500,000 jobs, as meat processors and other businesses might close.
WTO negotiators offered new proposals last week for reforming the rules that govern the trade in farm and manufactured goods, as they geared up for a high-level meeting aimed at reaching a breakthrough on the Doha round of global trade talks.
EU trade ministers will discuss the proposals on Friday before ministers from about 30 major trading powers meet in Geneva the following week to seek agreement on the commerce liberalisation talks that started in Doha, Qatar’s capital, almost seven years ago.
Rich and poor countries have haggled ever since over changes to global trade rules, with the fight between rapidly developing nations such as China, India and Brazil on the one hand and the United States and Europe on the other taking centre stage.

The WTO negotiations seem to be coming to a crunch and I'm still not much the wiser. On the one hand I'd like to see much more opportunity for developing states to trade globally on terms that suit their stage of development, and on the other hand I want to see Irish farmers able to grow and sell plenty of food. Does anyone know if the two things aren't mutually exclusive?

I think the IFA will be demonstrating tomorrow.

Breaking News today:

Quote :

'Now or never' for trade accord, says Barroso

The European Union will not be the “sole banker” of a world trade deal, European Commission President Jose Manuel Barroso warned this afternoon.

On the eve of make-or-break global negotiations in Geneva, he said the meeting could be the last opportunity to get a desperately-needed agreement – but only if the rest of the world was ready to make concessions.

The warning echoed EU Trade Commissioner Peter Mandelson’s insistence before leaving for Geneva on Friday that the EU had already done all that was “realistically” possible, and expected matching flexibility from Europe’s trading partners.

The remarks were seen as part of the last-minute brinkmanship as ministers and trade experts from more than 150 countries belonging to the World Trade Organisation converged on Geneva hoping to end almost seven years of negotiations in the so-called Doha Round of talks.

The deadline for a deal was 2005, but the talks struggled on, collapsing in acrimony in mid-2006 over trade protectionism and trade barriers, then re-launched at the start of 2007.

The issue has dominated Mr Mandelson’s political life since then-British prime minister Tony Blair sent him to Brussels as Trade Commissioner in 2004.

Now his legacy in the job – his term ends next year – could depend on the success or failure of the next week of intense, detailed negotiations.

More importantly, it could determine the economic fate of developing nations and offer new global markets to rich countries too.

Mr Mandelson said international agreements on climate change, food security and energy use could depend on a Doha Round accord – lifting the gloom of a current global climate of soaring inflation, high food and fuel prices, and high unemployment.

The elusive trade deal is intended to help end poverty in developing countries, cutting restrictive tariffs and opening up markets to the benefit of richer nations as well.

But the talks have repeatedly stumbled in rows over protectionism, state aids and export quota limits.

There have been wrangles within the EU as well, with France accusing Mr Mandelson two years ago of exceeding his negotiating mandate.

Then last month, new French president Nicolas Sarkozy accused Mr Mandelson of selling Europe’s farmers down the river to get a global deal. He even blamed Mr Mandelson’s proposed farm cuts for turning Irish voters against the Lisbon Treaty.

Mr Mandelson retorted that the French president had got his sums wrong – and the Trade Commissioner insists difference within the EU on detail will not be allowed to scupper European unity at the talks.

Today, Commission president Mr Barroso said the Geneva meeting was crunch time: “This is a great opportunity, and perhaps the last great opportunity, to take the decisive step towards conclusion of the Doha Round. The EU will continue to push for a successful result that would be good for Europe, good for developing countries, and good for the world economy and the multilateral trading system.”

He warned: “Europe cannot be the sole banker of this deal. For these negotiations to succeed, the other developed countries and the emerging economies in the World Trade Organisation also have to make a major contribution. The overall result has to be balanced and ambitious.”

The Geneva talks are also about the trade in industrial goods and services – the key obstacles to clear away before any total deal can be concluded.

Bananas are a stumbling block too - the EU has long been embroiled in controversy with the WTO over preferential rates it gives African, Caribbean and Pacific countries over Latin-American banana exporters.

As part of the Doha deal, WTO director-general Pascal Lamy has put forward a compromise which Mr Mandelson said the EU would not oppose, in the interests of agreement.

World Bank Group president Robert Zoellick said it was vital to make progress in Geneva: “It’s now or never.

“A breakthrough in the Doha Round would infuse confidence in a world economy buffeted by high food and energy prices, as well as financial strains.”

A Commission statement emphasised the need for compromise, declaring: “Seven years of work have produced the possibility of a final deal that – if all WTO members make a proportionate contribution – would go further in creating new trade than any past global trade agreement.”

No matter how hard I try, I don't seem to be able to lure anyone on to this thread. What does your husband think, Kate P?

WHO?

I'm quoting here.... as fast as I can:

The concessions for the developing countries - Africa mainly. In the last WTO deal they got the Anything But Arms deal. That allows in a lot of products like sugar, coffee, bananas - it gives them free access if they are classified as a developing country. That's why we went out of sugar - that was part of the last WTO deal. We gave that.

The previous arrangement was that we had a protected price for sugar in the EU with tarrifs on imports but small quotas from developing countries. WHile they were sending ina very small amount of sugar, and all the activists would have said we need to let them get more in and trade more. But we took away the protectionism on the sugar market and let the price go down so our farmers couldn't compete and went out of business. But now developing countries are definitely getting way more sugar into Europe - probably three times the volume, at a much lower price than previously - actually for about the same price now as they got for a third of the volume,. So they're selling more sugar but have no more money.

There's no cheap sugar on the shelves, no cheap bars from Nestle and no cheap cereals from Kellogs who are getting the sugar nearly 50% cheaper.

It's being sold as a simple way of saving developing countries, it's not. It's more about liberalisation of trade for the wealthier nations....

From an agricultural perspective, yes we have had a protected market that mainly revolved around CAP which came about after the two world wars when people did starve in Europe. It was so that we could secure a food supply for the people of Europe.

Now we're entering a very uncertain period in world food supply again. I suppose, the inevitable consequence of the deal that Mandelson has on the table in terms of agriculture in terms of what he is giving from Europe is that agriculture will run down in Europe. It won't pay us to produce at the prices. A thing that people forget is that European farmers have to live and work as consumers and pay European costs - electricity, animal health costs, all of which are at European levels, and real wage costs - we don't have slave labour and it's rigght that we don't. We have high standards and high regulation and I believe it's right that we do that. We gave the European consumer a very high standard of food, farmed in an environmentally sustainable way.

If Brazil are given more access to European markets what they're going to do is slash and burn more rain forests to produce more beef to send to Europe while at the same time we run down production in Europe. You can be assured - from the sugar example - that the European consumer won't get cheaper food.

We will have put ourselves in a very vulnerable posiiton where we're dependent, as we are now on other countries for our energy. Once we're not able to produce our own, they'll charge us what they like, a basic rule of economics.

Mandelson is proposing the following:

Today beef is worth 336cent per kilo and the farmer can barely make a margin at that. Mandelson's deal will mean that beef will be 196c per kilo to the farmer.
Why? Presently, any beef that comes from Brazil, Argentina, those huge beef suppliers, Uruguay, has to pay a tarrif of about 400cent per kilo on cuts of final product (ie, steak). Mandelson wants to cut that to 100cent which means that an extra half million tonnes of beef, all high quality cuts, will come into Europe.

Why should that matter? Beef is beef but our costs of production are not too far from that 336 cent but Brazilian ranchers who have people working for less than a dollar a day and just stake claims on land, don't have traceability on cattle, don't have to comply with any animal welfare standards, don't even see their cattle really and can send it a lot cheaper, can, if it's allowed come and will take away the market.

In turn, the result in Ireland is that we have a million cows that produce cattle for beef, they would all go, along with the 50,000 suckler farmers who farm them.

We'd also lose the further processing and service industries and another 50,000 jobs.

Lamb and dairying will suffer to the same degree. This matters to us because grass is what we go. Agriculture in Ireland buys 6bn in the Irish economy in goods and services in teh Irish economy. It's responsible for 26% of exports and of those 26% there's almost 0% of that originally imported into the country; pharmaceutical and computer industries the vast majority of their exports were previously imported into the country.

The often hugely lauded pharmaceutical industry, which in output is way bigger than agriculture, buys 2bn of goods and services in the country.

Imho we could change the CAP with the intention of becoming the main suppliers of bio food in the world. But because of the free-trade slanted Eurocrats, it is now impossible.

I also think that we would need widescale subsidies for farms to exploit their biogas, i.e. using their own biological wastes to produce electricity and heat. I don't understand why it is not being done.

Because Ireland is an island and has many farms, because oil and transport of oil are becoming so expansive, I think it should be a priority.

The food industry in general in Ireland is 97% Irish owned, so all profits are not generally repatriated to other countries.

The bottom line is Russia's got gas, the Arabs have oil, Sweden's got iron and steel, but Ireland has got grass, a natural resource, plus a base of 130,000 family farmers who turn this natural resource itno huge exports.

The only way we're going to pull ourselve out of this economic hole we're in, is through exports. Economists predict that food exports out of Ireland will rise in value terms because of a growing demand for food, if the WTO deal were not to happen - we could become the new IT industry of Ireland, and pull this economy out of the hole it's in. Also, isn't there a moral obligation on us, when we have the opportunity to produce food, not to let people put us in a position where we're not able to stay in business and it's not economical to produce food.

At the same time, a world-wide shortage develops. At present we have 4million consumers in Ireland but produce enough food for 36 million consumers so we are one of the biggest exporters of food in Europe because of our small population and therefore are probably more exposed to the negatives of this WTO deal than most other European countries.

Kate P wrote:

but Ireland has got grass

And grass will stay, it will not run away overnight to cheaper taxes countries.

When Mandelson has been asked about what he's gaining for industry - goods and services, nobody has been able to put their finger on the benefits of this deal to balance the losses to agriculture, not even Mandelson himself.

If you're making a deal, you hope to gain elsewhere but that's not happening here. Industrial people are not happy on the goods and services. I'd have worries as a consumer in general about this. It's one thing outsourcing the production of plastic buckets or 2E t-shirts to China - we can live without those things; it's another thing to outsource our future food production and security of supply for consumers in Europe because that's what we're effectively doing in this deal and in turn contributing further to climate change in air miles and the further destruction of the rain forest.

On Africa, the big thing always was that we were dumping our food surpluses on their market because we were too successful under CAP and downing the price for them. Since then we have reformed, thought we had done what we needed to do, taken away subsidies from production and now we're in deficit in beef, sheep, vegetables and grain in Europe, so we're not dumping anywhere now.

Actually in Europe at this present moment there is only 30 days grain in store at any one time. That means if some weather or other disaster happens that we lost this year's crop or half of it, we'd be out of wheat for bread and pasta, barley for animal feed (and beer) to convert into chicken and pigmeat. Whatever disaster would take the grain would take the vegetables with it - you can't store vegetables.

At one stage we had a year's supply of grain ahead of us, we've let it go to dangerously low levels. It's not unreasonable to think that we'll see people starve in Europe again. Certainly Europeans cannot be accused of flooding world markets anymore, we've adjusted our production, came to the conclusion that beef and butter mountains weren't the right way to go.

In preparation for this Doha round of talks, for the last ten years we put ourselves in a position where we can no longer be accused of dumping surpluses on world markets. We adjusted European ag production downwards and there was serious pain in this for farmers and that's why most farmers in Ireland work off-farm, as our contribution to (looks out window at passing tractor) make this round of talks work.

But after doing all this, Mandelson has offered way more concessions again. We as Europeans are the only ones who have adjusted our subsidisation, protectionism of agriculture. The Americans continue to protect American agriculture, so a deal with the Europeans giving more than we already have - we don't affect the African thing now and are net importers of all foods. They don't produce grain, beef or dairy products. Let's get real here. They're not able to feed themselves and we're saying we're going to let them feed us. It's the biggest rubbish ever that in the short term they're going to trade themselves out of trouble.

Given the predictions of climate change on Africa and its ability to produce food, if they are accurate, they will be able to produce less and less food because of drought while at the same time we could maintain our ability to produce food (though we'll have to change our cropping patterns). None of it makes any sense. It's very, very, very emotive to say that the WTO deal is about developing countries. Does anyone think that Bush or Mandelson, Lamy, Sarkozy, Brown or for that matter Brian Cowen or Angela Merkel or John Howard in Australia (is he gone now?) are going a world trade deal to benefit Africans while everyone among them except some of the Europeans have resisted anything that will help the Africans even in this round of talks.

The Americans never changed their farm bill one bit, Australia the same - all they want is more access for their product. Australia imports no meats of any kind. They, the New Zealanders and the Brazilians import almost nothing in the line of food.

I see it very simply, Bob Geldof see the European model of subsidised food production - whcih we don't have now, as an unlevel playing field for Africa, but if we take away the subsidies, we just remove us to their level, rather than bringing them up to our level of income, that's all. It will take European agriculture back 50 years.

The biggest threat to Africans and their economies and their people's incomes is not access to markets, it's lack of education on modern food production methods and the funding to invest to create agricultural production that first of all ensures they feed themselves.

Rubbish to talk about exporting food when they cannot feed themselves. It's like telling the Irish that we should have been exporting potatoes during the famine - and we did export grain and other crops and that's why people starved.

I can understand issues relating to World Bank, debt and corruption - from the perspective of Bob Geldof.

If there was half the effort put into doing away with corruption in African nations as there was in oil rich Iran and Iraq and Afghanistan, we might believe world leaders were more genuine about helping developing nations. We don't do anything about Mugabe - because there's no oil there.

WTO is a sham, doing a deal between 140 countries about what can be traded where. With a bit of luck, India will pull it down. They have 600million farmers, each owning about half a cow. The one cow farmer is bolloxed under this deal because he'll be blown out by the bigger outfits.He's doing subsistence farming and selling a bit of milk to his neighbour. One cow is able to make him live. But they have political issues of their own right now.

In the WTO deal there's no redundancy for farmers who go out of business. There is no talk of any compensation - it's zapped. It's very real, we got a bit of compensation for sugar, but when you go out to the field and there's no sugar beet, that's what makes WTO real for Irish farmers.

Irish Sugar made profits of 24.5million a year, employed 5,000 growers and 7-800 workers in it's heyday. It was a good industry, it's no longer there. The net result of that is our friend in the Carribean has to cut twice as much sugar cane with his slash hook for the same amount of money. He doesn't have the funds to invest in machinery because he has to work twice as hard. It's not working for them.

Low food prices won't help developing economies in any way. It's contradictory to say now that we need a world trade deal that brings about lower world food prices while for years Oxfam and other agencies blamed overproduction in Europe for cheap food prices and the undermining of developing farmers' prices. So let's have some consistency.

It's good and admirable to be on the side of developing farmers and European farmers do have empathy with farmers everywhere because there's a shared bond regarding the production of food from the nurturing of the soil. And Irish farmers would like to see African farmers get any leg up that could help them, but let's be genuine in this and not disguise a world trade deal that doesn't give them that leg up.

Let's do something to try help the investment and development in developing countries. Why aren't we tackling world bank debt and corruption in many of these countries. The top 5% of people are very wealthy and spend most of hteir time and energy keeping the other 95% down.

That's it for now.

You're from a farming family?

I'd get some solace out of it if I though there was some assistance for the developing world. Why should I be penalised or punished for investing, modernising, investing in myself and training and skills and becoming a top class food producer? Why should I not stand up for that, for what I feel is my very important role in society? Just as important as a doctor who would operate and keep you alive, or an airline pilot who keep you alive by flying the plane properly, we ensure that you have a secure, safe, quality food supply and have pride in that.

But now the World Trade deal wants to outsource the food production of Europe to the sweatshops of the farming world. That's why I was outside government buildings today. I believe we can stand over everythign we say, but when you live in a society that wants its food cheaper every morning you get up - or as Tesco say, more for less every day, the only time I win my argument, I fear, with consumers is when they can't get the food at all.

Phew.

All of the above, cf, is in answer to your question about what Mr Kate P thinks of WTO - it's all directly transcribed as he spoke for your ears - apologies for all my typos.

Yes, arnaudherve, we do farm.

Great Posting Kate

We've had our runs in on these issues in the past - but you've sold me and you have my vote this time.

Particularly as the Yanks are giving up nothing and the Africans really have to sort out their own food shortages first.

Personally as I've said from the beginning - Mandelson is on a hiding to nothing - at least 20 countries are seriously worried by his kowtowing at this moment in time - The French are definitely totally against - but its brinkmanship time at the moment and everybody will wait to see the final agreement - if there is one - which I seriously doubt unless the Yanks decide to make some serious concessions - which I do not see happening in an election year - all in all we are set up for a collapse in the negotiations - the main debate now is everybody trying to pin the blame of collapsing the deal on somebody else.

The problem is, (and this is me now and not my better half, but I'll pass on the compliments), that if there is EU agreement this Friday, then that sends out the wrong signals straight away.

Brian Cowen said that he'd not be afraid to use the veto, I don't think he'll have the balls after Lisbon.

It's extraordinary to think that one man, Mandelson, has the power to do so much harm to the world. If this WTO deal is passed, the history - if we have any, will not be kind to him.

Edo wrote:

Great Posting Kate

Indeed. Not that it is very relevant, but I felt so nostalgic by reading this. It's the generation of my grandfathers who moved to town, but I still remember childhood visits during the summer.

I remember camping outside the farm, then going to breakfast with the great uncle who liked to tell all sorts of jokes, and a few words of Breton. And getting morning eggs and trying to catch the hens.

Also, my best friend in highschool was from a farm. We used to get drunk in the barn before going to pubs and nightclubs. So that I never saw much of the countryside, lying at the bottom of the car. Well, it was night-time anyway...

Edo wrote:

The French are definitely totally against.

Yes but we're ruled by political elites who want globalization as well. And it's always the idealists of global trade who get the job of European commissionner for foreign trade.

I wonder what's the point of talking of European defence if we lose our agriculture. Without agriculture you're like offering your throat to daggers during negociation.

More than the French, I am influenced by the Japanese example. Sure their rice fields are quaint compared to their robots and so on, but they want to be a nation, hence they keep their agriculture.

Sorry I post too much today.

There are no quotas on posting, arnaudherve!! It was worth the post for this gem

Quote :

I wonder what's the point of talking of European defence if we lose our agriculture. Without agriculture you're like offering your throat to daggers during negociation.

It sets a context for Lisbon that I hadn't considered before.

arnaudherve wrote:

More than the French, I am influenced by the Japanese example. Sure their rice fields are quaint compared to their robots and so on, but they want to be a nation, hence they keep their agriculture.

That's a gem of a quote for me anyway.

Mighty posting Kate P & Mr. Kate P - thanks for that. Why does Mandelson have so much power anyway? And that statistic about us having 4 million but producing for 36 million will stick in my brain for a while now doing calculations, permutations, combinations...

Surely the whole business of the WTO is a sort of world peace because not all countries can produce food for themselves so they need to trade other stuff with others.. or is this actually true and the countries we think aren't able to support themselves, can do so in reality but don't and stick to doing what their natural genius is whether tourism or electronics...

There's also the possibility that the WTO is driven by massive corporations although I might have read this in a sci-fi RPG manual once. Your fact that sugar hasn't fallen in price ... hmm ... dodgy.

The Wikipedia article might be a good introduction after Kate's posts

Quote :

Mission, functions and principles
The WTO's stated goal is to improve the welfare of the people of its member countries, specifically by lowering trade barriers and providing a platform for negotiation of trade.[26] Its main mission is "to ensure that trade flows as smoothly, predictably and freely as possible". This main mission is further specified in certain core functions serving and safeguarding five fundamental principles, which are the foundation of the multilateral trading system.[27] The WTO/GATT system is founded on non-discrimination, with its twin faces of Most-Favoured-Nation and National Treatment principles.

http://en.wikipedia.org/wiki/Wto

Pas de tout arnaudherve.

Great stuff Kate P and husband of Kate P. A feast of a post after the famine.
Isn't it a disgrace that there is no real information and debate for the public on something as important as this. Is is lazy journalism, a conspiracy or an indifferent public? Or is it that our ability to focus on global decision-making has lagged behind the process of globalisation?

I think that I've read that the developing countries are supposed to get access to our food markets but advanced countries are supposed to get access to their unprotected manufactured goods and services markets ? I'm not sure of the implications of that.

There is also talk that the WTO negotiations are completely out of sychronisation with current demand for food and world food prices. With Brazil's economy growing at the rate it is, is it not likely that they will need to produce more to meet local demand? Things are changing very quickly and population levels increasing at a frightening rate.

I have an excellent book of geographical mapping of Irish agriculture produced by Teagasc in 2000. It predicted that only dairying in south west Ireland would be viable in unprotected markets. I wonder is that still the case?

When I was a child the idea of anyone being charged for water was unheard of and I used to think it was very strange that food wasn't also supplied according to need. I don't agree with dumping but I do agree with self sufficiency and ensuring food security. I would rather we put money into that than to the arms industry to equip Sarko's army with high tech killer toys.

Quote :

If there was half the effort put into doing away with corruption in African nations as there was in oil rich Iran and Iraq and Afghanistan, we might believe world leaders were more genuine about helping developing nations. We don't do anything about Mugabe - because there's no oil there.

You were both going so well - but I can't let that pass without choking on my tea. I recommend a quick shot of Naomi Klein for that one.

Oh, and I posted elsewhere on the site a link to a paper saying we are all going to run out of top soil in 70 years time and suffer species collapse.

Do we maybe not need a completely different approach to world food production that is in balance with the environment and which is sustainable?

I have begun reading a book by Naomi Klein, titled "The Shock Doctrine".

She argues that TPTB tend to deliberately create crises, such as food shortages, in order to force the populations accepting their reforms.

I was always under the imression that French agriculture consisted of about ten very fat rich men who were businessmen to the core and who kept the French pro-CAP through effective lobbying. I hear that the French are getting a bit nostalgic for the country living but isn't farming as a way of life effectlively dead there?

I always thought their devotion to the CAP was quite cynical compared to Ireland who at least have a few small farmers left. Please set me straight on any of this.

On the WTO front, I think your hubby might have been a bit idealistic when he envisioned all the farmers of the world holding hands and working together. I strongly suspect that that the ban on Brazilian beef, while undoubtably rooted in safety concerns, has provided a lot of solace for beef farmers (and I too have my interests in the subject). Safety regulations have been used as trade barriers before, and it's that appearance, that we are abusing safety concerns, that we have to face up to and counter. The GM ban is another one, but it affects the Americans and my heart bleeds a little less for their subsidised farmers.

arnaudherve wrote:

I have begun reading a book by Naomi Klein, titled "The Shock Doctrine".

She argues that TPTB tend to deliberately create crises, such as food shortages, in order to force the populations accepting their reforms.

Ha! if so it's backfired. There's more talk of food export restrictions and rice cartels than ever now.

Mussolini tried to make Italy self-sufficient in wheat in his day. Useless fact of the day, though maybe he could be rehabilitated by the slow food movement. He wasn't that bad really...