The seven year itch
Oh it feels good to finally be rid of it. Like many on both sides of the fence have said 'No deal is better than a bad deal'.
The WTO talks in Doha centred around free trade in a market that is endemically asymmetrical. Ignoring other agendas discussed, the talks around agricultural commodities trade consisted of, on one side, a set of arguments so farcical that you must give it to the American's if they expected they could pull it off. For all the soundbytes about free trade I fail to see how it is different from dumping of goods, as by most estimates American food exports have the characteristic of being below production cost, masked of course by the agriculture subsidies their big agro businesses are provided. This low price is temporary, until the local farmers are crippled to the stage that they can no longer farm, whereafter the food exporters exponentially increase their prices. This 'pull the rug from under your feet' trick is of course sanctioned by the IMF which otherwise prevents other countries under IMF loans the ability to subsidize their own farmers. Tariffs are essential to deal with such skewed supply management.
Kudos to India for calling this bluff. India, of course, has the history of taking moral positions in international forums, on issues of little consequence or interest, see NAM etc. But this time it has emerged something of a hero, with the backing of China of all countries. This stance will no doubt make our comrades a happy lot.
However before we get all elated about this outcome it is essential to realise that status quo has prevailed. The lot of our subsistence farmers, our inefficient granary storage and distribution systems, and our social and banking support systems are far from adequate to deal with the ills that inflict our agriculture industry. We are still inefficient producers, our public distribution system is full of middlemen salivating for a 'cut'. So our consumers also pay more then they should, or would have in a free market. The room for more technology as well as management in agriculture has to be underlined.
Some countries will definitely not be too happy with the outcome of the talks. Countries like New Zealand with low population, large arable tracts of land, and an advanced agricultural industry are desperate for new markets, and they would have benefited if India and China opened up their markets. Free trade would have also have forced techologically backward agriculture sectors/countries to adapt quicker than they are doing right now or face elimination from the industry. So this is a hard dilemma for me to take sides, I am a free trade proponent, but i am not unaware of the dangers to vulnerable segments of society who will inevitably be affected drastically by free trade.
Anyway, good to see the collective clout of the US and Europe not enough for a change. One is almost enticed to say to the US 'It was a good run, but your time is up' and if anybody can do it, it has to be all of us collectively. In doing so we must ensure that the voices of smaller nations are not lost. One can feel for this Burkina Faso minister.
This comment really made me lol!
The WTO talks in Doha centred around free trade in a market that is endemically asymmetrical. Ignoring other agendas discussed, the talks around agricultural commodities trade consisted of, on one side, a set of arguments so farcical that you must give it to the American's if they expected they could pull it off. For all the soundbytes about free trade I fail to see how it is different from dumping of goods, as by most estimates American food exports have the characteristic of being below production cost, masked of course by the agriculture subsidies their big agro businesses are provided. This low price is temporary, until the local farmers are crippled to the stage that they can no longer farm, whereafter the food exporters exponentially increase their prices. This 'pull the rug from under your feet' trick is of course sanctioned by the IMF which otherwise prevents other countries under IMF loans the ability to subsidize their own farmers. Tariffs are essential to deal with such skewed supply management.
Kudos to India for calling this bluff. India, of course, has the history of taking moral positions in international forums, on issues of little consequence or interest, see NAM etc. But this time it has emerged something of a hero, with the backing of China of all countries. This stance will no doubt make our comrades a happy lot.
However before we get all elated about this outcome it is essential to realise that status quo has prevailed. The lot of our subsistence farmers, our inefficient granary storage and distribution systems, and our social and banking support systems are far from adequate to deal with the ills that inflict our agriculture industry. We are still inefficient producers, our public distribution system is full of middlemen salivating for a 'cut'. So our consumers also pay more then they should, or would have in a free market. The room for more technology as well as management in agriculture has to be underlined.
Some countries will definitely not be too happy with the outcome of the talks. Countries like New Zealand with low population, large arable tracts of land, and an advanced agricultural industry are desperate for new markets, and they would have benefited if India and China opened up their markets. Free trade would have also have forced techologically backward agriculture sectors/countries to adapt quicker than they are doing right now or face elimination from the industry. So this is a hard dilemma for me to take sides, I am a free trade proponent, but i am not unaware of the dangers to vulnerable segments of society who will inevitably be affected drastically by free trade.
Anyway, good to see the collective clout of the US and Europe not enough for a change. One is almost enticed to say to the US 'It was a good run, but your time is up' and if anybody can do it, it has to be all of us collectively. In doing so we must ensure that the voices of smaller nations are not lost. One can feel for this Burkina Faso minister.
'"We can hardly control our anger," said Burkina Faso's Tade Minister
Mamadou Sanou.
.......
"wanted me to be here to negotiate on cotton. I have been here for 10 days
and I haven't been able to discuss cotton,he said'"
This comment really made me lol!
Labels: economics
posted by Sameer Sarma at 11:00 AM
0 comments
