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Agriculture and the Global South
Rich countries spend vast sums of money protecting their farmers, while prying open the markets of poor countries for their subsidized products, remarked VPDF Vice-President Nguyễn Văn Thanh. It is high time to remedy that unjust situation, he emphasized.
Addressing a VPDF-hosted conference in Hanoi, he noted:


1. Ninety-six per cent of the world’s farmers live in developing countries, where agriculture is their livelihoods and provides the main source of income for up to 2.5 billion people. Despite growing urbanization and continuing rural exodus, two-thirds of the world poor still live in rural areas and are employed in agriculture. Thus, the agricultural sector in developing countries is critical to food security, poverty alleviation, economic growth and sustainable development. Fostering agriculture growth is crucial to the poor in the Third World.

2. The system which governs world agricultural production and trade in the Uruguay Agreement on Agriculture (AoA) legalized unfair trading practices by rich countries and agrobusinesses, secured their right to subsidize substantially their own farmers, while denying poor countries the chance to benefit from their legitimate share of the wealth generated by global trade. An effective reduction in farm subsidies by rich countries is crucial for the future of Doha Development Agenda.
 The WTO Agreement gives rich countries an undeserved advantage by letting them dumping their subsidy-driven surpluses on world markets, depressing prices to levels at which local poor producers can no longer compete. Their livelihoods undermined, their export opportunitíes denied,  their dependence on import increased, their standards of living became more and more unbearable. Cotton, rice, sugar, dairy products…are vivid examples of practices of subsidizing and dumping of the North. Anti-dumping is becoming a necessary instrument among developing countries in search of a binding timetable to eliminate all subsidies including the subsidy of export credit.

3. While developing countries cut their average applied tariffs on agricultural imports from an average 30 percent down to 18 percent, high tariffs in rich countries continue to limit marketing and diversification opportunities for the South. The liberalization of agricultural markets has benefited chiefly the transnational companies and wealthy landowners in developed countries.

4. Every developed country has used the tool of tariffs as a key policy in its industrialization process. Now, with de-industrialization of the Third World in mind, they refuse to let developing countries use the same tool.

5. Food prices continue to climb ưpward at a pace not seen in decades, and there is a growing concern that biofuels have tied oil and food together and create serious negative impacts on food security and global poverty, especially to the LDC and the net food imported countries.

6. The loss of land and rural livelihood to meet the growing urbanization project and the expanding desertification. The depletion of ocean stocks due to fishery subsidies resulted in “to many fishermen to chase after too few fish”. The prospect of organic agriculture and fair trade in agricultural products and the preservation of environment deserve more consideration at the policy level.

7. Recognise and strongly enforce the Special and Differential Treatment for development countries (exemptions and exceptions from reform).

8. Improve market access conditions and provide flexibility for developing countries to achieve development objectives. Mr. Thanh gave the following additional information:
- Agriculture contributes about 2% to the GDP of the 30 OECD countries. Farmers in these countries receive support in various ways totalling 280 billion USD annually and equivalent to 1.1% of their GDP.
- By contrast, official development assistance (ODA) from OECD countries to developing countries amounted to 80 billion USD in 2004, while bilateral development assistance from OECD countries to farmers in developing countries accounted for only 3 billion USD in 2001.
- OECD countries dominate world trade in agriculture – with over 70% of exports and  75% of imports; least developed countries (LDC) account for only about 1% of world agricultural imports and exports.
- Food prices measured at the farm gate in OECD countries are 30% higher than in international trade.
- The biggest and richest 25% of farmers receive 90% of all support provided in the US and 70% in the EU.
- More than 70% of farm support in OECD countries is provided in the form of trade distorting market price support and payments linked to production, all of which are inefficient in terms of bolstering farm incomes. Of every $1 in price support only $0.25 ends up in the farmer’s pocket as extra income. The rest is absorbed by higher land prices, fertilizer and feed costs, and other factors./.

 

 

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