G8-AFRICA: FARM SUBSIDIES A TABOO SUBJECT?
Julio Godoy
BERLIN - In the preparations for this year's summit of the Group of Eight most industrialised countries, to take place Jun. 6-8 in the Baltic seaside resort of Heiligendamm, Germany, aid for Africa has topped the agenda. But the farm subsidy factor is likely to be avoided in the debate.
German Chancellor Angela Merkel has repeated again and again that the G8 countries (Britain, Canada, France, Germany, Italy, Japan, Russia, and the United States) will this time finally meet their pledge to double development aid for Africa by the year 2010.
Merkel and other high-ranking German officials have also insisted that G8 investment in Africa must increase, in order to reap the rewards that economic opportunities in that continent offer to bold private investors.
Activists, from retired rock musicians like Bob Geldof to the leaders of prominent development groups, have played a similar tune.
But perhaps the most important issue for African development, one that few have mentioned, is the need to reduce the subsidies that most G8 countries shell out to their farmers and the trade barriers that protect their own markets, which numerous studies show contributed heavily in the past two decades to undermining development in Africa and other poor regions of the world.
This is not something unknown to politicians and analysts in the G8 capitals. Already in 2005, the United Nations Human Development Report (HDR), which had the premonitory title "International cooperation at a crossroads: Aid, trade and security in an unequal world", said it quite clearly: "The basic problem to be addressed in the World Trade Organisation negotiations on agriculture can be summarised in three words: rich country subsidies."
The document went on: "In the last round of world trade negotiations (launched in Doha, Qatar in 2001) rich countries promised to cut agricultural subsidies." But, as the UNHDR remarked, since then, subsidies for agriculture in the G8 countries have steadily grown.
The world's richest countries spent just over one billion dollars for the year 2005 on aid for agriculture in poor countries, and just under one billion dollars each day of that year for various subsidies of agricultural overproduction at home. "A less appropriate ordering of priorities is difficult to imagine," concluded the UN report.
And the situation has not changed much since then.
Add to this "less appropriate ordering of priorities" the trade barriers in the European Union, the United States, Canada and Japan, which stand in the way of poor African, Asian, and Latin American farmers from exporting their agricultural goods to rich countries, and some perverse elements of the so-called development and emergency aid towards these very same regions, and you have a good picture of what is wrong with the G8 policies on global trade and development.
Consider the U.S. allocations to the World Food Programme.
Some 1.2 billion dollars per year in aid to the UN agency makes the U.S. government its largest donor. But the aid comes with strings attached: it must be provided in products made in the United States, meaning, in reality, that the allocations are a hidden subsidy for U.S. farmers and producers, and an insuperable barrier for poor farmers in Africa and elsewhere in the developing South, even during emergencies.
Alice Wynne Wilson of the non-governmental organisation ActionAid says "Good practice in emergency aid is to provide cash support to the World Food Programme, so that it can buy grain from the most cost-effective sources."
"Bringing large volumes of food into a region that has areas of surplus can lead to a situation where there are food shortages in one part of a country, and locally produced food rotting in other parts," Wilson added.
European countries also export their large agricultural, state-supported surpluses to Africa, at dumping prices, inundating the African markets with products sold under local prices (END)
