1st November 2001
Position Paper On The WTO Doha Ministerial Meeting
POSITION PAPER ON THE WTO DOHA MINISTERIAL MEETING
1. On the occasion of the convening of the ministerial conference of the WTO in Doha, Qatar on Nov 9-13, we leaders of peasant organizations and non-government organizations in the Philippines strongly condemn the WTO for undermining economies and food sovereignty of nations, destroying livelihoods of poor peasants and subsistence producers and retarding agricultural and economic development in developing and less developed countries. We call for the immediate withdrawal of WTO in agriculture.
2. We believe that the Ministerial meeting in DOHA will push for a new round that will mean the expansion of the WTO regulatory powers on the world economy for and in behalf of international monopoly capital. In the new round, agriculture will be a big issue. Moreover, the on-going negotiations on agriculture will come within the framework of comprehensive negotiations. This means that the industrial nations will be able to introduce more provisions favoring global corporate interests in a new round that would certainly be worse than the present. In light of the burden already imposed by the existing agreements on economies of the South as well as the threats posed by an expanded WTO discipline, the imperative for shutting down WTO becomes stronger.
3. The implementation of existing agreements such as the TRIPS, TRIMS, Agriculture, subsidies, etc. has more than bared the inequities and imbalances inherent in the WTO as an institution. Developing countries now bear the brunt of unfettered trade liberalization in terms of increasing foreign monopoly control of the local economy, worsening trade deficits, greater import dependency, intensifying landlessness and widening inequalities between and within countries.
4. The Agreement on Agriculture is one of the several agreements entered into by member states under the Uruguay Round of the GATT, the most comprehensive round since GATT’s inception in 1948. The AOA’s supposed objective is to correct and prevent restrictions and distortions in world agricultural markets. It incorporates three broad areas of commitments from member states, namely in market access, domestic support and export subsidies. However, the agreement, by design legitimizes dumping, force open markets of developing countries for these agricultural surpluses in the industrialized north, and prevents and pre-empts the sovereign rights of countries to protect their agriculture and ensure food security and self-sufficiency. The AOA is a highly inequitous agreement designed mainly to facilitate and expand control of agriculture by transnational corporations.
5. Implementation experience showed that there was no expansion of market opportunities for developing countries as the tariffication scheme was manipulated by developed countries to impose tariff rates higher than the original non-tariff barriers. Tariff peaks and tariff escalations were imposed on sensitive products thereby effectively blocking exports of developing countries especially those with higher value-added. Developed countries also abused the provisions on sanitary and phyto-sanitary measures as well as the rules on anti-dumping to set up inequitous barriers to exports from developing countries. While the AOA calls for the substantial reduction of domestic support, agricultural subsidies in developed countries continue to be very high. Clever manipulation of their subsidies through the provisions for exemptions under the green and blue boxes enabled developed countries to infuse more subsidies to their agriculture sector and hence cause dumping in the world market. Powerful nations like the US continue to issue export credits despite provisions for export subsidy reduction. The total agricultural support in OECD countries has reached $360 B in 1999 up by 28% from $280B in 1997. In effect, the AOA legitimizes the highly trade-distorting practices of excessive subsidies of developed countries while capping support to agriculture of developing countries to a minimum level.
6. Under the WTO-Agreement on Agriculture, the Philippine government committed to the elimination of all quantitative restrictions on imported agricultural products. Staple foods and sensitive crops that have been previously protected are now subjected to undue competition from imported products. Measures put in place to protect farmers’ products in the past such as import bans under the Magna Carta for Small Farmers were torn down and tariff rates drastically reduced to levels even lower than those stipulated in the agreement. On top of this, the government’s unilateral import liberalization program, also bound tariff rates of many important agricultural products to 3% by the year 2005. The rice and corn industry which provides livelihood to half of the peasant population in the country has been subjected to import liberalization even when local production, historically is enough to meet domestic consumption.
7. The benefits from the WTO-AOA that were trumpeted by government in 1994 have not materialized. The value of exports, predicted to increase at Ph Pesos 3.4 billion annually, continue to decline in the past six years as commodity prices remained depressed especially for leading agricultural exports like coconut, coffee, rubber, etc. In 1994, agricultural export earnings were at $2.072 billion, by 2000 earnings were down to $1.9 billion. Exports like mangoes and prawns continue to face stringent sanitary standards from the country’s main trading partners. Agricultural production has not recovered from its lackluster performance in the past years. Its top agricultural products like rice corn, sugarcane, and coconut have consistently shown declining growth rates in their real gross valued added. Worse, the farm gate prices of cereals, coconut, and coffee remain depressed as they face increasing competition from cheaper imports. Employment in agriculture is steadily declining contrary to the illusion that the agreement will bring in an additional 500,000 jobs annually. Employment growth rates contracted in 1995, 1997 and 1998. In 2000 alone, agriculture lost more than 2 million jobs.
8. The country’s food sovereignty was seriously eroded when the country emerged as a net food importer in the last few years. The local markets are flooded with cheap chicken quarters, onions, garlic, potatoes, temperate fruits, etc. Import dependency in rice stands at 8% of total consumption, not to mention massive smuggling of the commodity. As a result of massive imports, the country’s agricultural trade balance, which remained positive up to the eve of the WTO-AOA took a nosedive and trade deficits ballooned in the years 1995-2000.
9. The WTO-AOA worsened existing exploitative relations in agriculture. Massive importation dampened local production and drove prices of local products down. Land monopoly intensified as agribusiness corporations, commercial producers and the landed elite expanded their landholdings and intensified production for exports. Big business in the food and beverage industry, exporter-importers, and traders profited tremendously from the liberalized trading regime. They amassed huge profits from cheap imported rice, corn and sugar under the AOA’s minimum access opportunity, which imposed very low tariff rates. In effect, the WTO-AOA under the guise of “free trade,” only succeeded in further cementing the colonial trade relations between the Philippines and advanced industrial nations.
10. The Philippine government has only the interests of foreign monopoly capital, big business and the landed elite in the country in mind when it ratified the GATT-AOA in 1994. It would not be surprising therefore why those who were heavily affected were the millions of poor peasants and agricultural workers whose livelihoods and sources of food were seriously threatened. In fact, its accession to the WTO-AOA is nothing new. It is but a culmination of a set of structural reforms began in the 80’s aimed at fully liberalizing and deregulating the economy. Together with policies imposed by the IMF-WB’s Structural Adjustment Program, the WTO-AOA succeeded in fully opening domestic market, putting an effective cap to agricultural support and hence pushing the most vulnerable sectors such as the poor peasants and agricultural workers to bankruptcy, and fully re-orienting production from one aimed at the needs of the domestic population to the needs of the international market.
11. The WTO-TRIPS Agreement is another contentious issue in the coming Ministerial meeting as it brings into the WTO discipline, intellectual property rights which is basically a non-trade concern. Like the AOA, the TRIPS Agreement is designed to favor control of transnational agribusiness in global food production, distribution and supply through the privatization of genetic resources. The most controversial provision in the Agreement is Article 27.3 (b) which calls for the patenting of microorganisms and requires countries to set up a protection system for plant varieties. This provision clearly limits access of small farmers to seeds, prevents the free exchange and sharing of genetic materials, causes genetic erosion and seriously undermines food security of developing countries. In compliance with its commitment, the government has been fasttracking the passing of a law on plant variety protection which essentially reflects the interests of commercial plant breeders.
12. Despite substantial data pointing to the WTO-AOA’s disastrous effect on the food security and the livelihood of the majority of its agricultural producers, the poor peasants and agricultural workers, the Philippine government remains subservient to the big TNCs and committed to agricultural trade liberalization. Recent statements of Philippine negotiators in the WTO even go as far as mouthing the US line which links the attainment of food security to further trade liberalization. It also identifies itself with the CAIRNS group, an alliance of agricultural exporting countries, which currently supports the US position of full trade liberalization in the vain hope that the US would reciprocate by opening up its market to the former’s agricultural exports.
13. In the face of the disastrous impact of unhampered trade liberalization on our agriculture and economy, we call for an immediate withdrawal from the WTO-AOA. We believe that the only option available for the country to achieve sustained agricultural growth and development and thus ensure the livelihood and food needs of the majority of its population is to reorient its agricultural policies, including the creation of an external trading regime that favors the poor peasants, and the implementation of genuine agrarian reform.
14. Consequently, it must also withdraw from the CAIRNS Group, the position of which basically favors the US position of further opening up markets, nothwithstanding a lip service to the elimination of subsidies. Government must recognize that the WTO-AOA is not viable for countries like the Philippines whose agriculture is dominated by small subsistence producers tilling uneconomically viable small landholdings and have very limited capacities to compete with highly subsidized products from developed countries. By being underdeveloped and with a low technical core, Philippine agriculture will always be in a losing position in international competition vis-avis the mechanized agriculture and subsidy-laden agriculture of the developed countries.
15. The government must exercise its sovereign right to protect sectors of economy, including agriculture, that are threatened by foreign monopoly interests. Furthermore, it must assert its authority to impose full protective measures in agricultural trade and the whole economy, such as but not limited to quantitative restrictions. Above all, food self-sufficiency and the livelihood of the peasants should be deemed more important than the principles of “free trade.”
16. Corollarily, agriculture must be reoriented from one that is primarily production for exports to production for the domestic needs. In line with this, the Agriculture and Fisheries Modernization Act (AFMA) which places government support mainly on export-oriented production ventures while neglecting peasant subsistence production systems should be repealed. Higher subsidies must be accorded to price support, marketing, credit, irrigation and other infrastructure in food security crops and other crops which are the main source of livelihood for the majority of poor peasants.
17. The government should protect the domestic economy and its agriculture sector and should strongly oppose or ban dumping of agricultural products from developed countries. Dumping is made possible by the excessive subsidies accorded by developed country governments to transnational agribusiness corporations, the main beneficiaries of their subsidy program.
18. On the on-going TRIPS Art.27.3 b review, the government should stand for the exclusion of all life forms from patenting and must call for the precedence of the Convention on Biological Diversity over the TRIPS Agreement. Genetic resources and all life forms should never be privatized and used to control agriculture of different countries.
19. Finally, crucial internal reforms are urgent imperatives. A comprehensive and genuine agrarian reform that encompass the following must be immediately implemented:
a. Distribution of large landholdings to landless peasants and farmworkers. b. Reforms in agricultural trading and marketing including the breaking up of monopolies in agricultural trading, support to cooperatives, pricing support, and infrastructure development. c. Government program and support in peasant agriculture must be enhanced and expanded including support in research, irrigation, post-harvest, communication, transportation, etc. d. Reorient agricultural research to the needs of small peasants facing numerous risks in production and to ensure access of peasants to plant genetic resources.
20. Furthermore, the government must recognize the right of nations to pursue their own development and based on their situation and needs, government may enter into bilateral and/or multilateral agreements that are mutually beneficial.
This position paper is approved by the All Peasant Leaders’ Conference of the Sandigan at Ugnayan ng Magbubukid ng Pilipinas (SUMAPI) together with allied NGOs held in Quezon City, Philippines, on the 5th of November 2001.