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From WTO's ambitious goals to empty promises in Mexico

(Thursday, May 1, 2003 -- CropChoice news) -- Three pieces here about "free" trade and how it affects farmers and rural communities.

  • Mexico Farm Leaders Sign Development Pact
    By EDUARDO CASTILLO, Associated Press Writer, 04/28/03:
    MEXICO CITY - After months of angry protests, Mexican farm leaders signed a pact Monday that the government hopes will bring Mexico's antiquated agriculture industry up to date — but won't include farmers' demands for an end to free trade.

    The rural development accord does not go nearly far enough for many farmers, who say their small farms are being put out of business by bigger, better-funded U.S. competitors. It offers a bit more funding and subsidies, and vague pledges to try to keep quota or tariff protection for two Mexican crops, white corn and beans, under the North American Free Trade Agreement.

    But for President Vicente Fox (news - web sites) — who faced protests in which farmers blocked roads, herded farm animals into government offices and dumped produce in downtown Mexico City — the agreement marked a victory, one of the rare times his administration has managed to find a consensus with political foes.

    "This demonstrates that we are able to reach understandings based on free, sincere and open dialogue," Interior Secretary Santiago Creel said during the signing ceremony Monday.

    Fox hoped the pact would help jump-start his stalled economic and legal reforms. He has been unable to push many of his programs through Congress, and has been hindered by erratic policy pronouncements and a slow economy.

    "We are going to use this very same spirit to face the other big issues on the national agenda," he said.

    Given the jeers, catcalls and angry words that marked the two months of negotiations, arriving at any agreement at all was an achievement.

    Like some corporate farmers in Mexico, Fox built a lucrative trade in winter vegetables and fruit under the North American Free Trade Agreement. But he faced demands from farmers to ban imports of basic grains.

    In the end, Fox promised more money to address long-standing problems in the countryside: high production costs, unemployment, feuds over unclear land titles, and poor government infrastructure.

    "The pact is a good thing, but now the important thing is to see it play out in reality," corn and sorghum farmer Albino Franco, 43, said as he watched the ceremony. "We have hope now, and we can't lose it because it's all we have left."

    Several farm leaders said the accord was only the first step.

    "For us, the document isn't a national farm accord, even though it is called that," said Carlos Ramos, a representative from the farm organization The Countryside Can't Stand Any More. "It is a document to start a process."

    The plan includes a rural housing project, an electricity subsidy, a temporary job quota and a commission to oversee farm problems. Fox also agreed to ask the United States and Canada to accept voluntary quota limits on the amount of white corn and beans they ship to Mexico.

    "This is a transitional measure, which defuses a potential outbreak of social unrest in the countryside," columnist Jorge Fernandez Menendez wrote in the newspaper Mileno. "But it is far from a complete solution."

    Farmers in Mexico now import much of the grain they feed their animals and the country's 9 million farmers own an average of less than 12 acres each. Another problem, analysts say, is farmers' devotion to a few basic crops that are no longer very profitable as global commodities.

    "Other, more sensible measures should be the basis of these accords, like convincing those who plant corn, beans and coffee to change to more profitable crops," wrote analyst Sergio Sarmiento.


  • Singapore Min: WTO Farm Trade Goals May Be Too Ambitious

    WASHINGTON -(Dow Jones)- Members of the World Trade Organization (news - web sites) risk scuttling the group's current round of talks by setting overly ambitious goals in the highly sensitive agriculture sector, Singapore's trade minister said Monday.

    The WTO should aim for "a high level of generality in agriculture," agreeing on broad principles and goals that don't aggravate cultural and political sensitivities that are more pronounced in Europe than in the Western Hemisphere, said Singapore Trade and Industry Minister George Yeo.

    "On the present trajectory, the coming September (WTO) ministerial meeting in Cancun will be a repeat of Seattle," Yeo said in prepared remarks to the U.S. Chamber of Commerce (news - web sites), referring to 1999's failed WTO talks in Seattle, Wash. "All deadlines have been missed and problems are being piled up."

    Agriculture is the most contentious issue in the WTO's three-year round of trade talks running through 2004, known as the Doha round after the city where it was launched in November 2001.

    The U.S. has set ambitious goals to liberalize farm trade, while the European Union (news - web sites) (News - Websites) has asked for a more gradual approach. They were unable to agree on a proposed WTO compromise that called for a reduction of up to 60% in import tariffs on agricultural goods, a reduction in domestic market-oriented subsidies to farmers and a full phase-out within 10 years of subsidies that directly support agriculture exports.

    U.S. leadership will be essential, as progress will be impossible without a common understanding between the U.S. and the E.U., an understanding that won't be any easier since the Transatlantic dispute over Iraq (news - web sites), he said.

    Yeo warned against the U.S. abandoning the WTO for an independent trade liberalization agenda that divides the world into trading blocs. However, he said Singapore shares U.S. Trade Representative Robert Zoellick's strategy of spurring WTO progress through bilateral and regional trade initiatives.

    The Singaporean trade minister is in Washington this week to meet key U.S. lawmakers ahead of Singaporean Prime Minister Goh Chok Tong's May 6 visit to cosign a U.S.-Singapore free trade agreement with U.S. President George W. Bush (news - web sites). The deal would be the first of its kind between the U.S. and an Asian country.

    Negotiators for the two countries reached the trade accord late last year after agreeing on several thorny issues, including allowing a greater U.S. presence in Singapore's banking sector and allowing Singapore regulators to impose temporary capital controls on U.S. investors during emergencies.

    The Singapore deal was concluded at about the same time as another bilateral free trade agreement with Chile and U.S. lawmakers are trying to vote on ratifying both this year. But the Singapore agreement appears to be moving faster than the one with Chile.

    Yeo said Monday it isn't necessarily an advantage to be the first country to try to have a free trade agreement with the U.S. ratified under enhanced negotiating authority Bush won from Congress last year.

    "It's a dubious honor to be the first one to cross a minefield," the trade minister quipped. "We might rather have Chile alongside, preferably in front."

    -By Campion Walsh, Dow Jones Newswires; 202-862-9291; campion.walsh@dowjones.com


  • From Poverty to Promises
    Diego Cevallos,Inter Press Service

    MEXICO CITY, Apr 28 (IPS) - The hype and glitz that surrounded the ceremony in which the Mexican government and farmers' associations signed a new rural development agreement Monday stood in contrast to its content, which hardly resembled the far-reaching measures demanded by small farmers.

    In the presence of more than 1,000 guests, including state governors and the heads of several of Mexico's farmers' movements, President Vicente Fox (news - web sites) said the national farm accord marked the start of a "new era" for rural Mexico, where 75 percent of the country's poor are concentrated.

    Interior Secretary Santiago Creel said the pact would fulfill a long-standing debt to Mexico's small farmers, who contribute five percent of Gross Domestic Product (GDP (news - web sites)), three times less than 30 years ago, according to official statistics.

    But the National Union of Autonomous Regional Peasant Organizations (UNORCA) refused to sign the new accord, arguing--as did a number of analysts--that it was too "superficial."

    Rafael Galindo, a representative of the Permanent Agrarian Congress, a group aligned with the Institutional Revolutionary Party (PRI), which did sign the document, said that "the pact will not change the reality of the poverty" that plagues the country's small farmers, and warned that "this accord does not imply a halt to the struggle of peasant farmers."

    The new pact, signed after numerous nationwide protests by small farmers and nearly four months of negotiations, contains promises by the government. But it does not specify where the funds for the new measures are to come from, nor when they are to go into effect.

    "Some of the points of the accord are sensible, but most of them simply reiterate good intentions and previously existing plans," Sergio Maestre, a professor of agricultural law at the La Salle University in Mexico City, told IPS.

    The heads of farmers' associations with ties to the two main opposition parties, the PRI and the leftist Party of the Democratic Revolution (PRD), took part in signing the agreement at the ceremony in the National Palace, the seat of government. Fox described the event as "historic."

    "The national farm accord is the fruit of a broad, all-inclusive, respectful and plural process, generated from the very entrails of rural society and supported by a presidency that has opened up to society, that listens to its demands, that accepts proposals, and that responds with commitments," he added.

    According to the new pact, the government will provide U.S. $1.8 billion in additional aid to farmers in the medium-term, which will come on top of this year's agriculture budget of $11.7 billion.

    Part of the $700 million in windfall oil export revenues, the result of the rise in international petroleum prices, will also be earmarked for the country's agriculture sector.

    The agreement includes government commitments to support agricultural production and sales, and to provide solutions for some 30,000 disputes over land titles and property boundaries between states, local farm communities, and private owners.

    In addition, the pact pledges support for improving rural health systems and education and building rural housing, as well as special assistance for women and the elderly.

    But the revolutionary changes that the farmers' groups said they would negotiate with the government are nowhere to be seen in the accord.

    For example, agreements to lift tariffs on farm products in trade with the United States and Canada, Mexico's partners in the North American Free Trade Agreemeent (NAFTA), will not be suspended, as farmers had loudly demanded with roadblocks and demonstrations in which they even herded livestock into public buildings.

    Under NAFTA, Mexico removed some of the last remaining tariffs on U.S. farm imports in January.

    The government merely promised to push the United States and Canada for safeguards designed to protect Mexico's corn and beans, products that are to be opened up to free trade in 2008, and to "review" the rest of the agreements reached under NAFTA.

    Mexico's annual food imports rose from $7.79 billion in 1982, when the country began to adopt free trade policies, to more than $11 billion by 2001, noted researcher José Luis Calva at the National Autonomous University of Mexico.

    Around 20 percent of Mexico's labor force lives in the countryside, compared to just 2.6 percent in the United States. And productivity per hectare is 16 times higher in the United States than in Mexico.

    In the United States, the average state subsidy for farmers is $122 per hectare, against $53 per hectare in Mexico--a situation that the new pact will do little to change. Farm organizations had demanded a doubling of subsidies.

    Farm associations complain that because of NAFTA, Mexico now imports 95 percent of the soy beans consumed in the country, 58.5 percent of the rice, and 40 percent of the beef.

    Among the demands set forth by farmers that were not addressed by the agreement were a curb to the freeing up of trade in farm products on the domestic market, the adoption of a system of price guarantees, a ban on imports and sales of transgenic crops, and a call for an amnesty for rural activists jailed on various charges.

    Also ignored by the accord was the call for passage of a law on indigenous rights and culture that reflects the demands and grievances of the Zapatista National Liberation Army, a poorly- armed indigenous insurgent group in the southernmost state of Chiapas.

    In fact, none of the organizations that signed the accord represents Mexico's indigenous people, who comprise 10 percent of the population of 100 million, and who live mainly in rural Mexico.

    According to official figures, 90 percent of the 25 million people who live in the countryside are poor.

    The age-old problems plaguing the rural areas of Mexico persisted and were even aggravated despite the early 20th century agrarian revolution, in which around one million people died, and the seven decades of rule by the PRI (until the elections of 2000), a party that espoused rural causes and the ideals of the revolution, such as land reform.

    "In spite of the government's optimism, this accord is incomplete and overly vague, and it is yet to be seen whether it will be complied with," said Maestre.

    The most powerful rural groups taking part in the negotiations with the government were the National Campesino Confederation and the Permanent Agrarian Council, both of which are linked to the PRI, as well as the umbrella grouping The Countryside Can't Take Anymore.

    UNORCA and the Central Union of Peasant and Grassroots Organizations participated in the talks but refused to sign the pact.