Page 2 of 3 Farmers fight back against
free trade By Walden Bello
EU,
the figure was $40-50. While unsubsidized
smallholders in the developing world had to
survive on less than $400 a year, American and
European farmers were receiving, respectively, an
average of $21,000 and $16,000 a year in
subsidies.
With massive American and
European subsidies distorting global prices in a
downward direction, developing country agriculture
became
"non-competitive" under the conditions of
WTO-mandated trade liberalization. As the Food and
Agricultural Organization (FAO) notes,
instantaneous import surges following the adoption
of the AOA in a number of developing countries led
to "consequential difficulties" for
"import-competing industries".
The report
continued, "Without adequate market protection,
accompanied by development programs, many more
domestic products would be displaced, or
undermined sharply, leading to a transformation of
domestic diets and to increased dependence on
imported foods."
This historic shift to
dependence on food imports was, needless to say,
accompanied by the displacement of millions of
peasants.
Even before the AOA took effect,
the World Bank was predicting that Indonesian
farmers would lose out under the new regime.
Indeed, since 1995, farmers in rice and other
basic commodities have been marginalized.
Meanwhile, competitive pressures induced by trade
liberalization led to the expansion of commercial
plantations at the expense of smallholders.
In the Philippines, corn farmers, chicken
farmers, cattle raisers and vegetable growers were
driven to bankruptcy in huge numbers. In Mindanao,
where corn is a staple crop, many farmers were
wiped out. As analyst Aileen Kwa has described,
"It is not an uncommon sight to see farmers there
leaving their corn to rot in the fields as the
domestic corn prices have dropped to levels [at
which] they have not been able to compete." With
production stagnant, land devoted to corn across
the country contracted sharply from 3,149,300
hectares in 1995 to 2,150,300 hectares in 2000.
In China, tens of thousands of farmers,
including those growing soybeans and cotton, have
been marginalized with China's entry into the WTO.
Indeed, to maintain and increase access for its
manufacturers to developed countries, the
government has chosen to sacrifice its farmers.
According to the Institute of International
Economics:
The challenge of managing the farm
sector has grown with China's WTO commitments in
agriculture, which are more far reaching than
those of other developing countries and in
certain respects exceed those of high-income
countries. The Chinese government agreed to
reduce tariffs and institute other policies that
meaningfully increase market access; accepted
tight restrictions on the use of agricultural
subsidies; and pledged to eliminate all
agricultural export subsidies. These commitments
went far beyond those made by other participants
in the Uruguay Round negotiations that led to
the WTO's creation.
In Sri Lanka,
thousands of small farmers staged street
demonstrations to protest the import of chicken
parts and eggs, claiming they were being driven
out of business. The FAO concurred, noting that
import surges on major food items like chilies,
onions and potatoes made local production
"precarious, as reflected in the significant drop
in areas of production".
In India, tariff
liberalization, even in advance of WTO
commitments, has translated into a profound crisis
in the countryside. Indian economist Utsa Patnaik
has described the calamity as "a collapse in rural
livelihoods and incomes" owing to the steep fall
in the prices of farm products. Along with this
has come a rapid decline in consumption of food
grains, with the average Indian family of four
consuming 76 kg less in 2003 compared with 1998
and 88 kg less than a decade earlier.
The
state of Andra Pradesh, which has become a byword
for agrarian distress owing to trade
liberalization, saw a catastrophic rise in
farmers' suicides from 233 in 1998 to over 2,600
in 2002. One estimate is that some 100,000 farmers
in India have taken their lives owing to
collapsing prices stemming from rising imports.
Governments under pressure The
resistance to the new regime so opposed to the
interests of small farmers has come from several
sectors. At the international level, trade
liberalization and other anti-agriculture policies
led to the formation of two blocs of developing
countries: the Group of 20 and the Group of 33.
The G-20 put the developed countries on
notice that, unless they significantly reduced
unfair domestic support for agriculture, there
would be no more concessions on market access. The
G-33 demanded exemptions from tariff
liberalization for certain products considered
vital to agricultural production and employment
(special products or SPs). They also wanted the
right to raise tariffs and resort to other
measures - special safeguard mechanisms (SSMs) -
to protect their products from surges of
agricultural imports. When the EU and the United
States refused to compromise on these issues, the
WTO's Fifth Ministerial Meeting in Cancun in 2003
collapsed.
The Ministerial Declaration of
the Sixth Ministerial Meeting of the WTO in Hong
Kong in December 2005 recognized the right of
developing countries to designate SPs and
institute SSMs. However, US backtracking on this
commitment as well as its refusal to significantly
reduce its domestic subsidies led to the collapse
of the Doha round of negotiations in July 2006.
Developing countries simply could not provoke more
discontent among their peasant populations by
opening their markets even more in exchange for
cosmetic reductions in the massive EU and US
agricultural subsidies.
The driving force
behind the positions some developing countries
have taken in these multilateral forums is the
backlash in the countryside. In 2004, for
instance, a rural backlash against
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