As a result of unfair trade rules and falling commodity prices, Africa has suffered terms-of-trade losses and increasing marginalisation. Ten years after the Uruguay Round, the poorest continent on earth, which captures only one per cent of world trade, risks even further losses, despite promises of a ‘development round’ of trade negotiations. This would be a great injustice. There cannot and should not be any new round without an assurance of substantial gains for Africa.
Summary
As the poorest continent on earth, Africa needs debt relief, aid, and trade to help it to alleviate poverty and achieve sustainable development. Unfortunately, unfair trade rules and supply constraints impede Africa’s capacity to trade. As a result, it captures a mere one per cent of world trade.
In 2001, African countries were reluctant to launch a new round of WTO negotiations at the World Trade Organisation (WTO), because the Uruguay Round rules had not been fully implemented, and African governments were concerned that a new set of rules could hinder rather than foster development. But rich countries promised them that this round would be different: the Doha ‘Development Round’ would focus on the reform of WTO rules, with the specific aim of boosting the participation of poor countries in international trade.
Over the past four years, African decision makers have stated repeatedly and explicitly what their countries need from the ‘development round’, and yet it is a constant struggle for them to make their voices heard and keep their key issues on the agenda. In fact, if negotiations continue along their current track, it is doubtful that the so-called Doha Development Round will bring tangible benefits to Africa in terms of enhanced opportunities for trading, business, and employment. There is, in fact, a risk that some of the main obstacles that limit African exports will not be addressed in a meaningful way during the round. They include dumping of products of interest to African countries, such as cotton; lack of duty-free, quota-free access to rich-country markets for Least Developed Countries (LDCs); overly complex rules of origin; and non-tariff barriers (NTBs).
In addition, the small advantage that African countries currently enjoy through preferential arrangements with developed countries will be reduced as the round is implemented. Some of Africa’s main exports to Northern markets will face more competition as a result of the overall reduction in tariffs. On the import side, while LDCs are largely exempt from tariff reductions, other African countries are being asked to reduce their tariffs, with potentially adverse consequences for rural livelihoods and industrial employment. Finally, demands from African countries requesting ‘Aid for Trade’ to help them cope with the challenges linked to the implementation of the round and to relieve supply constraints, are unlikely to be fully met.
In this context, calling the current negotiations a ‘development round’ sounds like a cynical joke to many African governments and citizens. Key players in the Doha round should start taking African demands seriously. Fair and sustainable solutions must be found in time for the forthcoming WTO ministerial conference in Hong Kong in December 2005.
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