Agricultural subsidies is still the hot topic for world trade negotiators
If the WTO's Hong Kong ministerial conference ends in another walkout by developing nations this week, as it did two years ago in Cancun, chances are high that it will be because of disagreements over rich-world agricultural subsidies and import tariffs that are criticised for distorting world trade.
Joseph Stiglitz, the Nobel prize-winning economist and former head of the World Bank, yesterday blamed American and European cowardice before powerful domestic interests for the impasse over agriculture which accounts for less than 10 per cent of global trade but provides work for 70 per cent of people in the developing world.
'The basic concept of a global free-trade agreement is that the advantage it brings to an economy as a whole vastly outweigh any disadvantage to special interests that may exist within that economy,' Mr Stiglitz said. 'It is up to trade ministers and governments to communicate that point more effectively.'
According to Mr Stiglitz, in the US 25,000 'very wealthy corporate farms' share US$3 billion to US$4 billion in cotton subsidies which have a direct adverse impact on 10 million cotton farmers in sub-Saharan Africa.
'The damage that we do [in the US] is enormous - it is far greater than the amount of foreign aid we give out,' he said. 'We're not even making up for the damage through our foreign assistance programmes'