Reason’s Ronald Bailey had an interesting summary of a series of New York Times articles about the developed world’s still obscenely-high tariffs on food imported from developing countries.
One of the more egregious examples is the case of Vietnamese cat fish. Since imports of Vietnamese catfish compete with Mississippi catfish farmers, Sen. Trent Lott pushed a bill through Congress in 2000 declaring that only a species of catfish native to America could be sold as “catfish” in the United States. If that wasn’t enough, the U.S. Commerce Department added on tariffs of 37-64 percent to Vietnamese catfish on the grounds that Vietnam is a non-market economy and so was prima facie guilty of dumping catfish in the U.S. market.
Developing countries are starting to catch on that neither the United States nor Europe is truly serious about eliminating such outrageous trade barriers. The BBC reported that in a meeting of agricultural ministers from 25 countries held in Canada this July, Brazil threatened to prevent the European Union and the United States from extending an agreement that essentially bars challenges to their agricultural subsidies until the end of 2003.
The BBC quoted Brazilian agricultural representative as saying,
We have paid a very high price for that clause, and developing countries will not approve its extension.
The World Trade Organization will meet in September to discuss a roadmap to significantly reducing agricultural tariffs and subsidies, but the EU and U.S. are fighting draft proposals on grounds that they disproportionately favor one trading partner or the other,
WTO agricultural committee chairman Stuart Harbison proposed a 60% cut in agricultural subsidies over five years.
US negotiators say the proposal would favor the EU, while the EU has criticized the cuts as too steep, although analysis say it has moderated its position since its internal agricultural reforms.
Developing nations say the Harbison plan does not do enough to stop industrialized countries dumping their farm products and destroying markets for poorer farmers.
The right thing for both the EU and the United States to do is agree to a gradual elimination of all agricultural subsidies and tariffs. As The New York Times put it in an editorial on the subject,
By rigging the global trade game against farmers in developing nations, Europe, the United States and Japan are essentially kicking aside the development ladder for some of the world’s most desperate people. This is morally depraved. By our actions, we are harvesting poverty around the world.
Sources:
Harvesting poverty. Ronald Bailey, Reason, August 11, 2003.
Agricultural trade clash at summit. The BBC, July 29, 2003.