Wheat Board could be shredded Even countries as powerful as Canada stand to lose out from the new framework agreement, after its trade minister gave up the fight to defend the Canadian Wheat Board, which pools the power of Canadian wheat producers: this is now branded as another unacceptable example of government interference in a "free market".
The CWB's chair Ken Ritter summed up:
"The agreement was developed by the US, the EU and Australia. They are our big three competitors."
However the WTO at the end of August ruled for a second time against a series of US complaints that the CWB offers illegal subsidies to Canadian grain producers. US, EU found in breach of WTO rules By contrast the WTO disputes panel has ruled on August 5 that EU sugar subsidies are illegal and in breach of fair trade principles.
This echoes a similar ruling against US cotton subsidies: both systems serve to prop up high cost producers at the expense of potential competitors in other countries.
The subsidised sugar and cotton are "dumped" onto world markets at artificially low rates. John Lister LAST YEAR, in the full gaze of world-wide campaigners, a new grouping of the world's developing countries at the Cancun summit helped roll back the juggernaut of the World Trade Organisation, and the richest countries dreams of trade liberalisation that would boost their profits and open up fresh markets.
But at the end of July a much smaller meeting of just 40 trade ministers in Geneva adopted a significant new WTO framework document that has been branded by campaigners as "a major triumph for the big trade super powers".
Under the deal, developing countries will have to open up their economies to imports of manufactured goods and to large service companies - in return for vague promises on agricultural reform which the wealthier countries have already failed to deliver.
In just 12 months the world's richest nations have bounced back, showing a tactical agility that has clearly taken many opponents of globalisation by surprise: the Geneva meeting took place with over 100 trade ministers absent, and without any of the protests, pressure and close scrutiny from NGOs and anticapitalist campaigners that had helped strengthen the resistance at Cancun.
Among the biggest losers, once again, are the African nated by India and Brazil, had emerged as an obstacle to the power of the US and the EU.
A furious US administration at first responded by threatening to prioritise its own bilateral trade agreements, including the so called Free Trade Area of the Americas (FTAA), which was seen as a way of establishing market "freedoms" from Canada to Cape Horn.
In practice it has proved harder than the US expected to secure acceptance of the FTAA, and talks which should have clinched the agreement at the end of last year broke down without agreement.
However pressure from Washington did begin to fragment the G20, quickly persuading El Salvador, Colombia, Peru, Costa Rica and Guatemala to break ranks, demonstrating how fragile the unity had been between very different developing countries.
Indeed the two leading elements of G20, India and Brazil, had very distinctive interests, with Brazil seeking to promote its agro-exports by reducing agricultural subsidies in the USA and EU, and India seeking scope to maintain its tariffs on agricultural imports.
Having first set out to weaken the G20, Washington then joined Brussels in efforts to exploit these divisions of interest, and in April both Brazil and India were invited to join an informal group, the "Five Interested Parties", alongside the US, EU, and Australia, Brazil and India.
The brief for the FIPs was to draw up a constructive framework to enable the stalled Doha "development round" of WTO talks to proceed, and once sucked in to this process both Brazil and India felt obliged to trumpet any resulting proposals as a step forward for the developing countries of the South.
Because of the lack of scrutiny and involvement of many of the countries which had helped tip the balance against the wretched Cancun proposals, many poorer countries have yet to recognise how far their interests have been abandoned by the erstwhile leaders of the G20.
The resulting deal leaves room for the US and EU to continue their policy of high tariffs on imports of certain goods, while offering equivalent protection to the fledgling economies of developing countries. The anti-globalisation
movement was watching the outcome of last year's cancun
summit. No such
pressure was felt by
those signing up in
Geneva in July.
Although there are pledges that subsidies for agricultural products will be cit in both the US and the EU, there is no timescale for this, even while it becomes clear that export subsidies in the EU, for example, which are supposed to be phased out, are being replaced by direct payments to farmers - which are to be protected under the framework document.
Most of the developing countries had opposed WTO plans to open up their domestic markets for imports of non-agricultural goods, which they saw as a recipe for the bankruptcy of their own industries and market domination from the US and EU.
However the new document brings this back in, effectively offering a charter for profitable exploitation by global multinationals.
The poorer countries have also agreed to speed up the process of liberalisation in relation to services which previously have been protected.
The only real plus point from the agreement is that issues of investment, government procurement and competition have been scrubbed off the agenda for the remainder of the current round of WTO negotiations.
As the World Development Movement points out, the new framework is "a blueprint for deeper trade liberalisation that will not deliver poverty reduction to the poorest countries".
India and Brazil, the most powerful of the developing countries, have been sucked in to the ranks of the leading global trading powers, and used as a lever to force concessions from poorer countries.
A cynical deal, brokered through prolonged backroom negotiations, bribery, blackmail and bullying, now threatens to perpetuate the privileges and profits of the wealthiest nations at the expense of the permanent impoverishment and exploitation of the poorest.
The new agreement has been hailed as a step forward by the US administration and trade commissioner.
As one Canadian pressure group sums up:
"The WTO framework agreement is not "historic" ... it is an anti-development document, steeped in the neoliberal ideal of unfettered market capitalism enabled by weakened and weakening states".