The WTO ministerial meeting in Geneva last week failed to take any decisions on the question of food security. Indeed, we knew this would be the outcome even before the meeting began. As the ICTSD reported, two proposals on food security – both calling for exemptions from export restrictions for the world’s least developed and net food importing developing countries and for humanitarian food purchases by the World Food Programme – did not gain sufficient support at the WTO General Council meeting in late November to make the Ministerial agenda.
The fact that WTO members could not even support discussion of these specific measures does not bode well for the adoption of a broader and more comprehensive food security agenda at the WTO. The disagreements over rules on export restrictions have in fact served as a distraction from the broader food security issues that the WTO is already supposed to be working on.
The original Doha Agenda included negotiations on sweeping reforms to the 1994 Agreement on Agriculture, in particular to give special and differential treatment to developing countries, with a view to promoting food security. This was clearly spelled out in the agricultural work program of the Doha Declaration back in 2001 when the trade round was launched. It is worth quoting here to remind us how central it was to the original aims of the Round:
“We agree that special and differential treatment for developing countries shall be an integral part of all elements of the negotiations and shall be embodied in the schedules of concessions and commitments and as appropriate in the rules and disciplines to be negotiated, so as to be operationally effective and to enable developing countries to effectively take account of their development needs, including food security and rural development.”
In the decade since the Doha Round was launched we have seen major upheavals on world food markets, with soaring and highly volatile food prices that have been especially hard on the world’s poorest countries, most of which are highly dependent on food imports. As the FAO noted in its most recent Food Outlook, higher food prices in 2010-2011 increased the food import bill of the world’s least developed countries by over one third from the previous year.
In this context, advocates of trade liberalization have been quick to blame export restrictions as a principal cause of food price spikes and rising hunger. Such restrictions have undoubtedly exacerbated the situation in the short run. But the causes of rising food insecurity run much deeper and have longer term causes that themselves are not unrelated to WTO rules on agricultural trade – the very rules that the Doha Round was supposed to correct.
The developing countries that are dependent on food imports today were net agricultural exporters in the 1960s. Somewhere around the mid-1980s the situation reversed itself and today they rely on trade for around one quarter of their food consumption. What was the cause of this reversal in the agricultural trade balance? Declining agricultural investment was part of it – not just a decline in domestic investment in developing countries but also a dramatic drop international agricultural assistance. Why did this investment drop? In large part because cheap food was available on world markets, thanks to high subsidies in the rich industrialized countries.
This pattern was reinforced by the 1994 Agreement on Agriculture under the Uruguay Round which enabled the rich countries to keep their high subsidies while further prying open markets in poor countries that had already been forced to liberalize their agricultural trade under World Bank-sponsored programs of structural adjustment in the 1980s. As the UN Special Rapporteur on the Right to Food, Olivier De Schutter said in a press statement during the recent WTO Ministerial: “These countries are caught in a vicious cycle. The more they are told to rely on trade, the less they invest in domestic agriculture. And the less they support their own farmers, the more they rely on trade.”
What is really needed is a serious discussion in the WTO on how to reduce the dependence on food imports and rebuild resilient agricultural sectors in the world’s poorest countries. The early years of the Doha Round in fact had serious negotiations on this question. In seeking to protect themselves from surges of cheap imports that harmed the livelihoods of their domestic farmers, developing countries have been calling for robust safeguard mechanisms to be incorporated into the Doha Agreement . They have also been pressing the industrialized countries to reduce their farm subsidies. But the major agricultural exporting countries – the US, Canada and Australia, have fought hard against a strong safeguard mechanism for developing countries, and the subsidy cuts agreed thus far have been only minimal. In fact, this foot dragging on agriculture is a major reason why the negotiations have been stalled since 2008.
Addressing volatility in food prices is certainly important, and adopting specific exemptions from export restrictions is perhaps one way to alleviate the effects of price spikes on the world’s poorest people in the short term. But such measures – even if the WTO members could agree on them – should not distract us from the bigger picture. We must remember that the root causes of food insecurity are themselves not unrelated to the existing highly uneven WTO rules on agricultural trade, and that the original aim of the Doha Round was to level the agricultural playing field. This original WTO food security agenda should be brought back to the forefront of the discussions.
Agricultural Trade Balance of the Least Developed Countries, 1961-2006
Graphic reproduced from Jennifer Clapp, Food (Polity Press, 2012).