West out to ensure Africa remains underdeveloped

Before the World Health Organisation, there was the General Agreement on Tariffs and Trade (Gatt), established at the end of the Second World War.

Its purpose was to reduce tariffs and other trade barriers and eliminate preferences on a reciprocal and mutually advantageous basis. Gatt was signed by 23 nations in Geneva on October 30, 1947 and took effect on January 1, 1948. It lasted until 123 nations in Marrakesh on April 14, 1994 signed the Uruguay Round Agreement, which established the World Trade Organization (WTO) on January 1, 1995.

The objectives of WTO did not change from those of Gatt. Today, WTO represents 162 countries. The purpose of WTO is to reduce tariffs and other trade barriers and eliminate preferences for mutual benefit of trading partners. However, this is not happening between the developed and developing countries.

To remove the trade imbalances, the Doha talks began in 2001. The objectives of these talks were; reduction of tariffs on agricultural products for developing countries, increase duty free access for developing countries and reduction of subsidies for developed countries. The talks have been a bitter pill for developed countries to swallow who have a host of tariff and non-tariff trade barriers, yet these are the talks that if implemented can benefit developing countries.

The just concluded WTO conference in Nairobi yet again took a stab at the Doha talks. During the four-day deliberations, developed countries agreed to remove subsidies on agricultural exports, but with conditions. This agreement was described as "historic" although it falls woefully short of the expectations of developing countries.

At the very least, developing countries hoped that their Western counterparts would open up their markets fully for them by removing tariff and non-tariff barriers.

What is the implication of this agreement in the coming days? Europe knows that this agreement will only hurt farmers in Europe in the short term. In the long term, there are a million ways to locally compensate their farmers in the market place and keep the cost of production low. This can be done by subsidising manufacturing and processing, and they can do it without reporting to developing countries.

Moreover, there is no way Europe is going to buy goods from Africa if they can access similar goods in Europe at competitive prices. There has to be unmet demand for products in Europe to warrant import from Africa. This is ironical because, developing countries gained a false sense of achievement that there will be competitive prices in the market and so they will export more agricultural products to Europe.

Remember that Europe has unfettered access to African markets whose liberalisation dates back to the 1980s, following the publication of World Bank's report on Accelerated Development in sub-Saharan Africa.

Among other things, the report recommended eliminating subsidies and controls and letting market forces determine the price of raw material exports globally. Foreign Aid from World Bank to Africa was pegged on this condition and African states obliged.

Europe short-changed Africa by providing huge subsidies to their farmers. Even if Europe has promised to remove such subsidies, the benefits to developing countries are a pipe dream. The only way WTO can prove its relevance to Africa is by genuinely crafting a system that eliminates enormous trade imbalances that exist between the Africa and the west.