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While farmers of developing nations take to the streets, in a faint movement to protect themselves from the backlash of the WTO agreement, policy makers of the developed nations are fast losing patience with the conservative regimes of the developing nations.
While the developed nations are shamelessly playing a game of double standards, developing nations have lost faith in the treaty, leaving huge imbalances and negativity to be resolved before an amicable agreement can be reached.
So, does the WTO stand any chance? Obviously. The WTO is a multilateral platform for dialogue. If it can be properly exploited by the developing nations, there definitely can be a shift in the way the settlement is reached. That is, favouring the poorer sections of the global economy, the WTO is expected to spawn. There exists a tremendous scope for constructive dialogue to reach a justifiable settlement. However, the Pareto criterion has to be considered and let us not go overboard in our expectations.
The first challenge that lies ahead of the developing nations is to not succumb to the petty incentives of the developed nations. Thats what happened in the Doha Development Round. While the G20, as a collective bargaining union, held much promise, it collapsed in time for the developed nations to get their kill, by bribing the group nations with some petty aid or incentive packages.
Secondly, developing countries have to realize that if developed nations are not willing to open up their markets, why should we? While corporate farmers of the EU and US can penetrate into markets with dirt cheap produce, our produce loses competitiveness. Why is there dirt cheap produce on the market? Though they have complied with WTO norms when it comes to export subsidies and domestic support, the norms just were not enough to control developed nations' programmes, while curbing the effects on developing nations.
For instance, The Agreement on Agriculture(AoA) requires developed nations to reduce their tariffs by 36% over a period of 6 years, while developing countries were expected to reduce them by 24% over a period of 10 years. As developing nations had earlier, little or no tariffs, now they are blocked from using them at all; while ironically, developed nations had tariffs to the tune of more than 100% and even over 300% for imported produce. Therefore, it has not at all affected the protectionist regimes of developed nations. They have also augumented their green box and blue box support programs, whose influence is yet to be studied. How come such loopholes were left without questioning? Here again, we see that developing nations have not rationally contributed to the multilateral treaty.
Moreover, when some barriers have been removed in developing nations, developed nations have brought up more barriers to protect their markets, but still staying under WTO norms. Product standards have been increased and, meaning that to penetrate into a US or EU market, the standard of your produce has to be ridiculously high, where developing country produce barely stands a chance.
Developing countries must not get carried away by petty incentives given by developed nations to quiet them; and they should actively contribute, making their stance clear in multilateral talks. Besides, if developed nations can use the loopholes, developing nations can too.
While domestic support and export subsidies are meagre in developing nations, if they are forced to withdraw them, they can also initiate green box and blue box support programs. The ultimate way to force developed nations to the agreement is for developing nations to stop opening up their product and service markets: "If we dont have access to your markets, why should you be able to access ours?"...that should be the response..
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