Poor countries walk away empty handed, again

A trade agreement that allows 200 IT products to be imported duty free has emerged as the biggest deal so far at meeting of commerce ministers that just ended in Nairobi.

This is after the delegates agreed on the timetable to eliminate tariffs on the IT products valued at over $1.3 trillion per year, eliminating fears that more than 15 years of tortuous and expensive global trade talks would end in failure.

The agreement is the first major tariff-cutting deal at the World Trade Organisation (WTO) since 1996. However, poorer countries have walked out of the talks empty handed in the agricultural trade deals that ended in a stalemate. Delegates attending the meeting failed to agree on the most important deal for Africa in the agriculture sector as rich nations stuck to their guns.

It was hoped that the meeting would unlock the stalemate in contentious issues in the agriculture sector and eliminate subsidies that continue to hurt farmers from the continent trying to access the international market.

The closing session was pushed forward by more than seven hours. By midnight Thursday, there was still no deal on many of the contentious issues. Journalists were called at about 10.30pm in the night to be told that there was still no deal and that the delegates had given themselves a Thursday midnight deadline. The story repeated itself yesterday. The closing ceremony had been earlier scheduled to be at noon yesterday. But this was pushed forward to 7pm. By the time of going to press, the deal had not yet been struck.

The most important deal for Kenya and the rest of the continent is the agreement on a date for the elimination of export subsidies in agriculture.

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But it was not all gloom, several deals came through. For instance, the IT trade agreement, which has been described as a landmark deal, was agreed by representatives of major exporters of information technology products. Negotiations were conducted by 53 WTO members, both developed and developing countries, which account for approximately 90 per cent of world trade in these products.

All the 162 WTO members will benefit from the agreement as they will all enjoy duty-free access to the markets of the members eliminating tariffs on these products.

Significant achievement

“I am delighted to mark this breakthrough here today at the Ministerial Conference,” said WTO Director General Roberto Azevêdo. “This is a very significant achievement. Annual trade in these 201 products is valued at $1.3 trillion per year, and accounts for approximately 10 per cent of total global trade.”

Among the products covered in this agreement are new-generation semi-conductors, GPS navigation systems, medical products which include magnetic resonance imaging machines, machine tools for manufacturing printed circuits, telecommunications satellites and touch screens. Other issues agreed upon at the conference are on e-commerce, where it has been agreed that nations maintain the current practice of not imposing customs duty on electronic transmissions until the 2017 ministerial conference.

“This decision is favourable to Kenya which is a vibrant and growing innovator of e-commerce products and services like M-pesa,” Foreign Affairs Principal Secretary Karanja Kibicho said. Kibicho, who is also the head of the Kenyan delegation, said the conference had agreed on the extension of the transition period for granting patents in pharmaceutical products for least developed countries for another 17 years.

Kenya also joined a number of nations that ratified the trade facilitation agreement, which aims to cut barriers in international trade. Locally, a bank and a donor agency rode on the WTO wave to announce funding for women and small business owners.