WORLD TRADE ORGANIZATION CANCUN CONFERENCE

The Cancum summit of the world Trade Organization held in early mid September 2003 c ollapsed without a declaration. The meeting ended in anger and rebellion on the part of the African, Caribbean and least developed countries that virtually walk ed out. The extreme position taken by the developed as well as the developing countries on the two key issues of agriculture and investment negotiations led to the fail ure of talks at Cancum, Mexico. The Doha, Qatar development agenda stressed the need of using global trade and i nvestment to address the persistent poverty that overwhelms the developing world . The Cancum conference was also set to discuss the Singapore issues listed belo w in addition to the issue of Agriculture subsidies granted by developed and dev eloping nations to their farmers: 1. 2. 3. 4. Investment Policies Competition Policies Government Purchases Trade Facilitation

INVESTMENT POLICIES: By an agreement on investment Policies, the developed countries want to bind dev eloping countries to according the same treatment to foreign investors accorded to domestic investors. Sovereign governments particularly in less developed coun tries will then be prevented from directing the investment of capital in certain selected areas where it might be urgently required. The national interests and priorities of developing countries like India, in correcting regional imbalances or supporting the weaker areas will be jeopardized and hampered. Economic selfreliance, a very cherished goal will become extremely difficult to follow. COMPETITION POLICIES: The acceptance of Competition Policies as stated in the Singapore issues will me an that developing countries will not be able to place restrictions on the activ ities of the Multinational Corporations. India s efforts to strengthen the local man ufacturing base and particularly that of stressing the cottage and small scale i ndustries will have to take very very rear seat. GOVERNMENT PURCHASES: There is absolutely no rationale in bringing the so-called transparency in Gover nment procurement and bringing it under the International regime. This should be the sovereign right of any country. Accepting this premise will mean floating i nternational tenders for all kind of government purchases including food grains. The price security provided to the cultivator will be gone. The poor and the vulner able sections of the society will be left to the mercies of the profit- oriented market. TRADE FECILITATION: Trade facilitation is a name given to MNC s free transit of the goods, freedom to th em from imposition of any fees, publication and administration of trade regulati ons connected with imports and exports by the Governments of the developing coun tries. It is an attempt to force the developing countries governments to revise rul

es and regulations concerning exports and imports which favour MNCs. Restriction s will be placed on powers to discipline the MNCs thus bartering away the sovere ign rights even in ordering our domestic affairs. FAILURE AT CANCUM: The most contentious issues at Cancum were the key issues of agriculture subsidi es and the investment and competition policies. The European Union, the U. S. A. , Canada and Japan which give huge subsidies to their farmers and to the MNCs engaged in food processing were not willing to discuss these issues which are te rmed as GREEN HOUSE Subsidies. The subsidies extended by these countries (U S DO LLARS 300 BILLION) would amount to almost thrice our total national product in a griculture. These countries were also insisting that the developing countries re duce their tariffs on import of agricultural produce. The acceptance of this wou ld result in disaster to local farmers due to unfair competition. The developed countries also charge more than penal duties on import of agricultural goods 300% on butter in Canada and 1000% plus in Japan for certain types of rice). Cancum failed to get an agreement on the reduction of farm subsidies, both expor t and domestic and it failed to launch negotiations on reduction of trade barrie rs and other Singapore issues. The U S has already threatened that it may leave the multilateral approach of th e WTO and may enter in bilateral deals with individual nations. It may also be noted that the average OECD tariff on manufactured goods from DEV ELOPING COUNTRIES is 4 times higher than those from rich countries. The duty rel ief provided under GSP does not provide sizeable market access with this level o f differentiation. The importance of GSP is thus grossly exaggerated. It is hoped that this failure is the beginning of a truly multilateral functioni ng of the WTO. It is also hoped that the Ministerial conference planned for Dece mber 15, 2003 at Geneva will address this issues rationally and to the benefit o f all WTO members RICH and POOR. While trade liberalization is bound to be pursued in future, the stalemate at Ca mcun has delivered a clear and unequivocal message to the influential members of the WTO that extracting concessions from the poor is not going to be easy in fu ture. India has emerged as an important entity representing the interests of the developing countries in teaming up with China, Brazil and South Africa. P.S. Please ensure that every one visits GOOGLE and searches for BUSINESS CULTU RE. Oct. 23, 2003