WTO talks highlight emerging nations’ power

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When ministers from over 30 countries gathered at the World Trade Organisation (WTO) headquarters in Geneva last month and failed to arrive at a consensus on market-opening commitments in agriculture and industrial goods in the first few days, WTO director general Pascal Lamy resorted to a short cut to achieve a breakthrough quickly.

He formed a core group of seven countries that included representatives of both developing and developed countries. This select group included India, Brazil, China, the European Union, the US, Japan and Australia. Significantly, Lamy said later that a similar core group around 15 years ago would have included the US, the EU, Canada and Japan as they were the important players then, but now it had to be a group of seven including “big brothers” like India, Brazil and China. “This is because the world has changed,” he admitted.

The growing clout of the BRIC (Brazil, Russia, India and China) countries was evident even more in the WTO talks as India and China stood up to enormous pressure from the US to weaken the Special Safeguard Mechanism (SSM). The SSM enables developing countries to impose additional duties to protect the livelihood of poor farmers from import surges of farm products and their fall in prices. The issue eventually led to the failure of the marathon negotiations on the ninth day.

Of course, it is another story that Brazil broke ranks with other developing country allies in this aspect due to their aggressive interests in the farm export business. Significantly, Brazil’s agri-exports were worth over $58 billion last year.

But the leadership of developing countries taken up by both India and China to protect hundreds of millions of poor farmers had the backing of around 100 countries including the G-33 (the group of countries including India, Indonesia, Cuba, Philippines and Venezuela, all with defensive interests in agriculture), African Group comprising all African WTO members, the ACP group including African, Carribean and Pacific nations, and the small and vulnerable economies (SVEs).