Food and Agriculture: Seeking Trade and Investment Rules That Make Sense as the WTO Meets in Bali

 Caroline Dommen, QUNO Representative, Global Economic Issues, Geneva

In most cities, supermarket shelves are stacked with food from all over the globe, even though only a fraction of food produced worldwide enters international trade.

Yet the rules governing international trade as well as investment in agriculture can have profound effects on all countries’ food, environmental, economic and social policies.

Dissatisfaction with current rules for trade and investment in agriculture

Today there is widespread agreement – amongst free trade advocates as well as its critics – that international rules relating to agriculture trade and investment do not contribute to a sustainable, equitable, people-centred food system.

QUNO has long been following talks in the World Trade Organization (WTO) (headquartered in Geneva), working with delegates to achieve fairer outcomes from global trade. The objective of WTO rules on agriculture is to establish a “fair and market-oriented agricultural trading system.”

A few years ago, we came to the realization that given the objectives of WTO’s approach to agriculture, even the improvements that might be politically achievable within that institution would not sufficiently respond to the main challenges that we see as facing agriculture today.

One reason is that the WTO’s main thrust is out of synch with the world’s realities. WTO rules were drawn up in early 1990s and designed to respond to the features of that time, particularly low and declining agricultural prices and the assumption that countries would always be able to source food from world markets.

Today the situation has changed: food prices are high and potentially volatile, and since 2008 countries have experienced difficulties in accessing food for import at affordable prices, if at all.

And, perhaps most importantly to Quakers, there is also increasing awareness of the need for the environmental costs of food production and trade to be internalized into prices.

Like many Friends, we believe that there is an urgent need to take better account of the non-market values and costs of agriculture – particularly the social and environmental factors and the long-term costs of intensive production visible in excessive use of water, chemical inputs and soil degradation.

Envisioning a New Global Framework

So we decided to step back from the WTO agriculture negotiations to think more radically about the purpose, structure and directions for governance of agriculture trade and investment.

QUNO believes that by placing people’s livelihoods and dignity alongside sustainability and food security as the central objectives of agriculture trade and investment, it is possible to envision a new framework that would better enable countries to meet peoples’ long-term food security needs and objectives.

We believe that through sharing expertise and experience, civil society, academics and others can jointly propose a new, credible and robust framework for agriculture trade and investment.

Some important work has already been undertaken, for instance through the EcoFair Trade project,[1] the European Alternative Trade Mandate[2] and this year’s Trade and Environment Report of UNCTAD[3] (the Geneva-based UN Conference on Trade and Development).

QUNO is working with these groups and others to create a shared space in which to talk about and develop alternatives. We will dedicate 3 years to this work, in an ongoing process in which different actors will be able to develop ideas and strategize on plans for change.

 We are excited, although also aware of the many challenges that lie ahead.

Challenges ahead

One challenge lies in the metrics by which development is measured. For example, for many of those with whom QUNO interacts, increasing production through foreign investment and trade is considered as a country’s means to development. So proposals to limit trade in agricultural products can be interpreted as “anti-development.”

In the trade policy context that still sees the Global North as being pitted against the Global South, this is not a tenable approach. We need to find new ways of measuring and expressing development, in a way that is fair to people, sustainable, and respectful for our Mother Earth, and does not further increase unfair competition between Northern and Southern economies.

We also need ways to express planetary boundaries in economic thinking. One simple way might be simply to increase the cost of finite resources such as fossil fuels. This pricing mechanism would ensure that the cost of transporting food that enters international trade is adequately reflected in its final price. But this could result in manifestly unjust results and unduly burden the most poor and vulnerable inhabitants of our world, limiting further their capability to access the same food as those with a higher purchasing power, and so perpetuating inequality. We therefore need to consider more sophisticated, equitable options.

These are amongst the questions on our mind as we move towards our consultation in January.

Whilst at the WTO….

 And many of these questions will be further heightened by the results of the WTO’s Ministerial Conference this December in Bali, where once again, food security is likely to be relegated to the bottom of a trade-liberalization agenda. Indeed, with some concessions to developing country concerns[4] the agenda is dominated by the issues of trade facilitation and customs cooperation, for which industrialized countries are the main demandeurs. Some food security-related proposals are on the table but as at late October, the negotiations around these are mired in politics.

 For QUNO’s background documents and more information about QUNO’s work in this area, please visit www.quno.org (See Areas of Work -> Food & Sustainability) or email us at nftia@quno.ch