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WTO meeting struggles on

14 December 2005

WTO meeting struggles on with little of substance being offered to poor countries

HONG KONG – Oxfam Make Trade Fair campaigners took their “Big Head” mannequins of rich country leaders on a tai chi exercise at the WTO Ministerial in Hong Kong today, however the real leaders struggled to show the same energy in world trade talks.

Various issues sparked headlines at the talks today, including rich country offers on aid-for-trade, food aid, cotton and the possible emergence of a new grouping of developing countries. On aid-for-trade, it was reported that Japan had offered $10b over three years, the EU 2b Euros by 2010, and the US $2.7b a year by 2010 to help poorer countries build up their capacities to improve their trade.

However, Oxfam noted that most of the money offered was in recycled pledges.

Barry Coates, Executive director of Oxfam New Zealand, said from Hong Kong:

“Aid for trade is needed to help poor countries, but it must not be a substitute for fairer trade rules. "It is scandalous that the EU and Japan have made announcements of aid for trade as inducements to get developing countries to sign up to new trade commitments. It turns out that this is all previous announced "recycled" money. Some of the EU aid has already been recycled twice.

"This adds insult to the injury of the EU failing to address its unfair agriculture trade policies. They are in danger of wrecking a second WTO Ministerial in a row after their role in the failure of Cancun two years ago.

“In each case, most of the money would come from existing aid budgets, forcing poor countries to decide between trade and spending on basic essentials like medicines or education. Furthermore, it comes with an unacceptable and explicit push for rapid market opening from poor countries, which poses a grave threat to development.” "The EU and Japan are dunking the same tea bag, twice. And because Japan is offering loans instead of grants, they then want their tea back.

Meanwhile, the EU and the US continued their on-going spat on food aid, with the EU criticizing the US for using food aid as a way to dump food. Coates said:

"In a world where 850 million people suffer from chronic hunger, food aid can be a vital part of any humanitarian response. However, US demands that food aid be sourced in America and delivered in kind, rather than cash, cause unnecessary delay and can hurt the very people that food aid is designed to help. The system must be reformed. By using cash, food can be bought locally and given to people who need it more quickly, without undermining local farmers’ livelihoods. The EU should not us food aid as an excuse to extend export subsidies."

The issue of cotton – which helped cause such a rancorous end to the last WTO ministerial in Cancun in 2003 – has again been raised and is likely to be discussed by delegates in closed talks tonight (HK time). Phil Bloomer, head of the Make Trade Fair campaign said:

"Cotton could bring these talks to their knees once again in Hong Kong. US subsidies undermine African cotton farmers' livelihoods as confirmed by a recent WTO ruling. Although specific promises were made to address the issue progress has been minimal. If there is any hope of the Doha development round succeeding, the US must act immediately and unilaterally to end all cotton subsidies in compliance with the WTO ruling."

Rumors also began circulating about a potential new grouping of developing countries – the “G110” – which would be united in opposition against the current proposals on the table. Bloomer said:

"Developing countries showed in Cancun that they will not be railroaded into a bad deal. Solidarity and assertiveness amongst developing countries is vital to achieve a pro-development outcome and resist rich country attempts to stitch up a deal that serves only their interests."

ENDS

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