Banana deal brings hope to barren WTO Doha trade talks outlook

By Keith Nuthall, International News Services

For many journalists covering globalisation affairs, the end of the European Union’s (EU) banana trade dispute with the USA and Latin American countries is like the loss of an old friend. This dispute – which ended today – has been subject to formal World Trade Organisation (WTO) proceedings since 1996. Its resolution is a rare ray of sunlight in Geneva, where multilateral trade talks have long been mired in self-interest and complacency.

The Doha Development Round of global trade negotiations – which itself has been lumbering on since 2001 – appears far from completion. The political and commercial impetus that pushed its predecessor, the 1990s Uruguay round, towards great success, is nowhere to be found with Doha.

The governments of big countries, such as the USA, the EU, India, China, Brazil are pretty happy with relying on their local markets and existing trade partners, despite the knocks of the recession. And they are content with combining government spending with encouraging domestic consumers to push them back into prosperity.

Large multinational companies with stakes in these countries are also happy. If they can shelter their factories behind high tariff walls and red tape, then do they really want a trade agreement that would let little competitors nip at their heels?

And that is what is so riling about the failure to agree a Doha round agreement. The big guys are conspiring to keep out the little guys. The big economies – they’ll do cozy bilateral trade deals – like the recent one struck between the EU and South Korea.

But what if The Gambia or Nepal come calling for a bilateral? ‘No thanks mate – you’re small and dirt poor – why do we care?’ That’s the answer they’ll receive. Only a truly multilateral deal that wipes out trade barriers for everyone will help them.

These smaller countries have themselves to blame partly. When the Doha round was a living breathing negotiation process, they were using their power (all WTO agreements must be unanimous) to hold things up – for instance, African countries such as Mali, have been playing hardball over American cotton subsidies – they want them gone.

And others have been persuaded to push for more gains by deluded anti-globalisation activists, rich country middle-class youths who oppose world trade deals that would allow poor countries to trade themselves out of poverty.

These faux radicals have helped create the myth that globalisation is for the elites, to help the wealthy get wealthier. Maybe they should ask the millions of Chinese workers hauled by world trade from backbreaking subsistence farming to work for growing textile businesses. Their companies are now moving up-market and good money is being made. What would they think of handwringing anti-globalisation activists, many safely employed in developed countries, if they understood how they had conspired to suffocate their prospects?

They would probably despise them. And it is for these workers, the Indians, Chinese, Brazilians, Nepalese, Indonesians and Paraguayans who until recently were growing food just to survive – that a Doha deal must be done and done by 2011 latest (no one believes it will happen in 2010, whatever the politicians say).

And if Barack Obama and his American Democrats – who have been more protectionist than the widely reviled George W Bush – cannot understand this, then this president should give back his Nobel Peace Prize.

If he has any of the global insight and leadership implied in his well-meaning speeches, then he’d fly to Geneva to push for an international deal as important as the one in Copenhagen on global warming he is so keen to support.

ENDS