Despite resounding rhetoric it was business as usual at the WTO meeting in Geneva, writes Faiza Rady Considering that anti-corporate globalisation activists had buried the World Trade Organisation (WTO) in Mexico last September, the trade body made a remarkable, if unexpected comeback in Geneva this week. 2003 was indeed a bad year for the WTO, a year of anti-corporate globalisation marches and dramatic walkouts from high-powered ministerial meetings. The September debacle in Cancun, Mexico, saw Southern countries refusing the dictates of the rich. They walked out, closing down the meeting with a bang -- reminiscent of Seattle 1999. At the time Walden Bello, economist and director of Focus on the Global South, commented that "the WTO is like a bicycle, if it doesn't move forward, it falls down." In Cancun, the "bicycle" fell down because the block of rich countries -- led by the United States, the EU, Japan and Canada -- refused to slash subsidies to their agricultural markets, while demanding that poor countries liberalise at any cost, come what may. No matter that millions of Southern farm workers will lose their livelihood if liberalisation takes its lethal course WTO-style. The scenario is simple enough: Southern governments dismantle protective tariffs and trade barriers, while highly subsidised Northern agro-businesses continue to dump their cheap products on the world's poor countries. At Cancun, however, the rich countries failed to peddle their strategy. Led by Brazil, the world's 11th industrialised nation, and India -- another emerging giant -- Southern nations flatly refused to toe the line. In Geneva things did not, at first, look promising for the WTO's die-hard leadership. In fact, a significant number of Southern nations initially rejected the first draft document as a revamped replica of the Cancun text. "Not surprisingly, India formally rejected the 16 July Frameworks as a basis of negotiations very soon after it appeared, as have many civil society organisations such as Third World Network, Public Citizen and other groups belonging to the influential Our World is not for Sale Network," commented Bello. Still, Southern nations did finally succumb to the rich countries' pressures on Saturday. Following two weeks of day and night meetings and, in the words of the WTO statement, a "gruelling" 24-hour marathon session extending from Friday into the wee hours of Saturday, the recalcitrant Southern lot turned around and signed a slightly revised package. "The WTO strategy worked at all levels. It included tiring out Southern delegates, who were literally locked up for the night. In the end, people were simply exhausted and therefore more malleable," Aileen Kwa, senior trade analyst with Focus on the Global South, told Al-Ahram Weekly. "Round-the-clock meetings produce 'historic' breakthrough, read a triumphant WTO statement on Saturday, adding that the organisation's 147 member governments "approved a package of frameworks and other 'agreements'". Although the frameworks are not final agreements, they constitute commitments and references for future negotiations. Still, nothing comes easy. The rich countries had to work hard at threatening to cut off aid and other goodies to developing countries. It goes without saying that poor and aid dependent nations remain vulnerable to arm-twisting, even when represented by interest blocs like the group of 20 (g-20), which includes India, Brazil, China, South Africa and Egypt. "It is too early to know the details of what happened, since negotiations as usual went on behind closed doors," Kwa told Al-Ahram Weekly. Indeed, since its inception in 1995 the WTO has never been known for its transparency or its democratic methods. Thus it was business as usual in Geneva, where a select few high-powered delegates negotiated in the secrecy of the "green room", while everybody else roamed around the hallways. Although the WTO boasts a membership of 147 countries, only 16 countries actually struck the "frameworks deal" which, among other things, negotiated away the livelihood of the world's poor farmers. "The WTO's tale of 'historic breakthroughs' is a sham," said Kwa. Despite the organisation's vehement claims to the contrary, Kwa believes that trade distortion mechanisms favouring rich countries remain alive and kicking. Hence, subsidies will stay in place after being moved about and reshuffled. The WTO says that West African cotton farmers in Benin, Burkina Faso, Mali and Togo -- who have been throttled for years by heavy US government subsidies to the American cotton industry -- will benefit from the deal. According to WTO reasoning, the frameworks include a bonus to Southern farmers in the form of an immediate "down payment" -- a 20 per cent slash in the current level of Northern subsidies to their agricultural sector. So far so good, but loopholes abound in the finer print. A case in point, the developed countries managed to squeeze the notorious "blue box" into the Geneva package -- despite strong Southern opposition to the fund. Regarded by critics as a convenient cover-up for subsidies, the blue box houses much of the $100 billion the 2002 US Farm Bill allotted to the industry. Thus, the billions are safely tucked away from public scrutiny and officially sanctioned subsidy levels. If this is the case, will West African cotton producers in the real world benefit from the 20 per cent cut in US cotton subsidies? Probably, not much. First, there is the hefty blue box fund to consider, in addition to the annual $2.8 billion US government cotton subsidy. If the latter is slashed, then the blue box would conceivably compensate for any incurred losses to the industry. On the other hand, it remains to be seen whether the US and their partners will, in fact, comply with the 20 per cent cut of their current subsidies. Aileen Kwa is skeptical. "It is just a matter of shifting subsidies from one box to another," Kwa explained to the Weekly. "The idea is to increase production, while maintaining the current level of subsidies -- so, it looks like there will be an overall reduction of subsidies. But the system as such remains intact." Besides juggling with production figures and shifting gears and boxes, the package sports other lucrative loopholes. EU agricultural products, for example, are covered by the "sensitive products" section which protects the industry from tariffs estimated at 20 to 40 per cent of its credit line. Not a bad deal, all things considered. Hence, subsidy losses incurred by the 20 per cent down payment clause could presumably be compensated by the 20-40 per cent tariff protection. According to the record, it looks like Northern agro-business subsidies are here to stay. Under corporate globalisation, welfare for the rich is part of the package deal. Liberalisation, then, only looms large in the South where the multinationals are in the process of expanding and gobbling up the land. As a result, an estimated 2 billion of the world's 3.1 billion farmers will lose their livelihood -- courtesy of the WTO.
