SEMINAR:“WTO NEGOTIATIONS: NON-AGRICULTURAL GOODS LIBERALIZATION VS. AGRICULTURAL LIBERALIZATION”

The Interdisciplinary Centre of Studies on Development, Uruguay (ciedur) member of the International Gender and Trade Network (IGTN) organized the Seminar “WTO negotiations: non-agricultural goods liberalization vs. agricultural liberalization” which took place on 26 June 2006. --> See programme


NAMA negotiations and their differential impact on women

Negotiations on industrialized products or “non-agricultural market access” (NAMA) negotiations have always been at the forefront of multilateral activities at the GATT and the World Trade Organization (WTO). Commitments on NAMA demand greater liberalization efforts from developing countries due to the fact that further tariff cuts are expected in countries that have higher original tariffs.

NAMA negotiations, as they are currently presented, pose serious threats to development and the survival of domestic industries in countries where they have not yet consolidated. Without tariffs firewalls, domestic industries in developing countries will now face international competition from well established and well capitalized foreign firms. In the mid/long term, the forced (due to import competition) abandonment of this sector by nationals will engender a process of de-industrialization in the South.

As well as in politics or culture, countries’ economies, are gendered structures in which there are differing opportunities, challenges and constraints for men and women. The development effects of NAMA negotiations should then be analysed taking into consideration these inequalities. For an exhaustive analysis of the differential impact on women see the presentation by Economist Soledad Salvador from IGTN/ciedur here. ---> See document

Within the framework of the ongoing Doha Round -also named the "Development Round"- and the importance of NAMA negotiations on an international and regional level, the idea of a multi-stakeholder debate emerged as a way to exchange points of view with governmental, academic and civil society sectors.

The need for a debate comes at a time where the Uruguayan government is shifting its international policy strategy in favour of a Free Trade Agreement with the United States and a consequent weakening of the regional free trade area – MERCOSUR - composed of Argentina, Brazil, Paraguay, Uruguay, and the newly incorporated Venezuela.


Where does Uruguay stand on the issue?

The Foreign Ministry of Uruguay (MRREE) is the governmental body in charge of negotiating at the WTO. Ministro Brigida Scaffo, Director of the International Economic Organizations Department at the MRREE on NAMA was invited to inform about the Uruguayan position

To begin with, Ms. Scaffo pointed out that due to the country's dependence on livestock and related exports, Uruguay's main objective at the WTO is to obtain benefits in market access to its agricultural products.

Regarding NAMA, Uruguay does not have an 'aggressive' stand but rather an "expectant position". Bearing in mind the existing parallelism between NAMA tariff cuts and tariff reduction in agriculture, she considers them to be "two sides of the same coin".

Ms. Scaffo also stressed the need to coordinate the different positions of negotiation at the WTO with the members of the MERCOSUR given that any commitment on NAMA by a member could affect the block's Common External Tariff rates. To this end, an ad hoc group was created within MERCOSUR.

The Uruguayan Foreign Ministry has been working until now with the "interested stake-holders" that to this date include only private company representatives of some key sectors such as the booming forestry sector. ---> See document


NAMA negotiations: from the Uruguay Round to Hong Kong

Roberto Bissio from the Third World Institute (ITeM) reviewed the NAMA negotiations at the WTO from a civil society perspective.

Firstly, he reminded the audience of the growing disagreement between developed and developing countries in the agriculture vs. NAMA negotiations. On the other hand, the way in which the WTO functions results in decisions being taken by 30 Ministers in a small room while the rest of the poor countries "are given the document to sign at the last minute and in English because it could not yet be translated".

As far as an analysis of the social impacts of NAMA is concerned, Bissio remarked that there are very few studies on the matter not only in Uruguay but worldwide. Besides, some of the studies already available are far from independent; very often they have been used as means for pressure instead. For instance, "at the Uruguay Round there was a study that said that trade negotiations would result in additional 600 thousand million dollars for the developing countries as a result of an increase in trade. That was signed by renowned specialists and was used as a strong argument against any opposition. Today we know that was not the case."

Developing countries have many reasons for rejecting the demands on NAMA. An important one is that due to the high level of informal economy in most developing countries, trade tariffs are a significant source of revenue intake for the government. If these tariffs are eliminated, it would have a tremendous impact on government expenditure. "The loss of income for these countries equals the entire annual international aid".

On the other hand, a commitment on NAMA has direct impact on the industrial sector and on employment. It is yet difficult to determine which countries have calculated this impact, but some studies indicate that in the case of India for example, a 5.6% loss of jobs can be expected if NAMA negotiations succeed in the present terms.

Bissio pointed out that there is almost unanimity regarding the threats to development NAMA commitments pose, "even the World Bank admits that NAMA will result in meagre development and could have negative impacts on employment, especially for developing countries".

The main question according to Bissio is: how far is the cost to pay reasonable? If we base ourselves on recent experience, developing countries have already made big concessions in exchange of mere promises. Such was the case of the liberalization in the services sector that developing countries agreed to, in exchange for the promise to talk about agriculture by developed countries. Several countries in the South have reached the conclusion that "no deal is better than a bad deal".

Carlos Longa, Chief of the Agreements and Negotiations Department at the Latin America Integration Association (ALADI), stressed the key role of Brazil and India in defending developing countries interests on NAMA since the Doha Ministerial Conference in 2001.

Hong Kong and beyond: a perspective on the forthcoming negotiations

Marcel Vaillant, Economics Consultant for the Secretariat of the MERCOSUR, talked about the outlook on the future NAMA negotiations after the Hong Kong Ministerial of 2005.

Mr. Vaillant first pointed out that there is a clear division between "aggressive" policies from countries that foster a greater liberalization of non-agricultural goods (namely the European Union) and the "defensive" policies applied by a great many developing countries.

On the other hand, he dissented with the idea that no deal is better than a bad deal since it is also necessary to consider the possible costs of a disagreement.

On a regional level, he argued that NAMA negotiation in the WTO also present a great opportunity for MERCOSUR to restructure its Common External Tariff and attain further liberalization both in agriculture and industrial products. According to Vaillant, it would create favourable conditions for the MERCOSUR block to start negotiating with other countries such as the United States.
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The role of civil society and its impact on negotiations

Lilian Celiberti from Articulación Feminista Marcosur, remarked that there is a significant lack of public debate on the issue due to the fact that trade issues are usually considered to be on the hands of a few experts while the people affected by it, including civil society organizations, are left aside.

NAMA negotiations aim at reducing tariffs on a wide range of product areas such as forestry, fishery, textile and clothing or automobile. For this reason, it is essential that the Democratic State informs their citizens on the decisions it plans to make, said Celiberti.

Representatives from REDES-AT, member of Friends of the Earth in Uruguay, also demanded to be included in the government's consultations in order to take decisions on NAMA at the WTO, a privilege which is now only granted to the private sector in Uruguay.