Introduction – about the EcoFair rules conference
More than a billion people are facing severe hunger worldwide, three quarters of whom live in rural areas. The global food situation tragically illustrates how years of political mistakes and the current hunger, climate and economic crises hit the poorest of the poor the hardest.
The number of undernourished and starving people will probably continue to increase. The challenges facing agriculture throughout the world are enormous. Sufficient food must be produced for a rapidly growing world population on continually shrinking productive farmland with decreasing soil fertility, less available water and dwindling fossil resources. This is occurring under increasingly precarious and extreme climatic and economic conditions. Moreover, changing consumer habits and energy concepts will lead to more intense competition between food, animal feed and energy crops. Inequities in distribution will increase.
The conference EcoFair rules! takes place in wake of not only these developments, but on the heels of major global summits such as the World Food Summit, the climate change negotiations in Copenhagen and the World Trade Organization (WTO) summit at the end of 2009, which failed to produce results addressing these issues.
Since it is time to reconsider and redefine the regulation and flow of international agricultural trade against the backdrop of severe global crises (such as the climate, food and economic crises) the conference seeks to bring together expertise to address these issues.
The key questions of the conference have been:
- What are the challenges but also the potentials of agricultural trade in times of food insecurity, climate change and economic instability. (Opening panel)
- How would agricultural trade rules that foster a socially and economically sustainable agricultural development look? (Forum 1)
- What institutional framework is needed for sustainable consumption patterns? (Forum 2)
- Where is the potential for agricultural trade to combat food insecurity and which institutional framework is needed? (Forum 3)
- What challenges confront an agriculture that endeavours to reduce fossil inputs (especially oil) and climate-damaging emissions? What institutional framework is needed? (Forum 4)
- What international institutions do we need for sustainable agricultural development, and what role does the WTO play? (Final plenary session)
1) What are the challenges but also the potentials of agricultural trade in times of food insecurity, climate change and economic instability. (Opening panel)
In his keynote address, Mr. de Schutter (Download MP3, 38 MB) reviewed the conditions and policies that have caused much of the developing world’s poverty and hunger. He then addressed how, if implemented properly, international trade can be used as an instrument to aid development.
From the 1950s-1970s, policies in developing countries were characterized by an active government that controlled regulation, and most post-colonial countries continued to produce raw materials and did not develop industrialization. In the 1980s, under the new Washington Consensus, markets were liberalized and government and regulatory tools were dismantled. Import tariffs were lowered, currencies were devalued, and an emphasis on increasing exports led agricultural policy. This left developing countries vulnerable to cheap import surges and marginalized small farmers both politically and economically, as small-scale and labor-intensive farming was squeezed out or pressured to become large-scale farmers. These policies have been the cause of hunger and poverty in rural areas in developing countries, and has caused millions to move to crowed urban slums in order to make a living, Mr. Schutter explained that some see trade liberalization as a solution to poverty, but he sees it as a tool that must be used cautiously if it is to work for development. He pointed out that applying Ricardian free trade principles to agricultural trade are problematic for numerous reasons, and would like to see the following considerations guide the debate on trade and agriculture:
- Trade in the agricultural sector is carried out not by countries but primarily by large transnational corporations; yet only countries are mentioned in international declarations and treaties.
- In some sectors of agriculture, there is excessive concentration of actors who dominate the market (such as in coffee), and therefore competition is only enforced to a limited degree.
- In order to overcome the dualization in agriculture of either small sustainable farmers or large agro-business, small farmers need access to global supply chains and need alternatives to becoming large agro-business.
- We need to encourage local trading, regional markets and shorter supply chains, which will especially benefit small farmers and sustainable practices.
- We must remember that the principle of food sovereignty does not necessarily mean self-dependence. We will need more trade in agriculture as some areas will be unable to support themselves.
- The Right to Food should guide our search for solutions, and trade needs to be made to work for, not against, food security.
2) How would agricultural trade rules that foster a socially and economically sustainable agricultural development look? (Forum 1)
In the first forum, there was a detailed discussion on how to establish a general framework for a future-oriented and sustainable agriculture. The following problems and suggestions were identified:
- There needs to be more stable prices for agricultural products, which could encourage more investment in this sector.
- Small farmers must get a higher portion of these increased and stable prices. Their position could be strengthened through access to local markets, improved local marketing and an improved distribution system.
- More investment in research on locally sustainable production methods is needed.
- There are many problems with the current multilateral regulations on domestic production. One is that big producers instead of smaller farms still retain the biggest profits from subventions. Another is that the WTO’s criteria and categories against trade-distorting effects are in need of immediate reform and monitoring (ex, Green Box subventions still retain trade-distorting effects).
The forum came to a consensus on the following points:
- Multilateral solutions are preferable to bilateral ones.
- The stabilization of agricultural prices is absolutely necessary.
- The WTO needs to more seriously consider other international processes and trends, such as climate change and food security, in its own trade regulation policies.
- Establishing stronger local and regional markets are important steps towards food security.
3) What institutional framework is needed for sustainable consumption patterns? (Forum 2)
Mostly political discussion dominated the second forum, with the following discussions:
- There was agreement that there are many different types on consumers, and consumers need to be educated on their choices. The idea of a ‘driver’s license’ with corresponding education and information for consumers was suggested.
- There is a need for clear labels on products in order to establish standards, although this has been fiercely resisted by industries and would need to be monitored and this would only be a first step in educating consumers.
- Many of the panelists emphasized the need to decouple financial markets from the agricultural prices.
- Although we do need international forums for dealing with global problems, the emergence of ‘G-8 / 20‘ summits were criticized as too much ‘show’ and too little substance.
- The idea of ‘public money for public goods’ was stressed, and the use of subsidies and agricultural programs that were wasteful and counterproductive were criticized.
4) Where is the potential for agricultural trade to combat food insecurity and which institutional framework is needed? (Forum 3)
The third panel agreed upon on the following topics:
- External factors are playing a growing role in agriculture, and we are seeing new actors (such as exchange rates and speculation) influence prices and demand as well as influence the entire supply chain.
- There was agreement that speculation in the food and agricultural field must be combated, as this contributed to the food crisis in the last few years.
- There was acknowledgment that it was not a lack of adequate food supply that caused the food or cost crisis. However, the demand in food and the fuel required to produce and transport food will continue to grow and we must be prepared for this.
- The food crisis is not yet over, and high volatility will likely, leaving millions vulnerable to hunger.
- Small farmers’ organizations must be empowered to negotiate for higher prices and access to global supply chains.
- There was not a final consensus on deciding who is responsible for implementing these guidelines, and it remained an open question as to whether it should be Southern or Western governments, or international organizations.
- Another debate that was not resolved through consensus was that of pro self-sufficiency vs. more trade. It was not clear which one is more complementary to more sustainable agriculture and ensures Right to Food.
5) What challenges confront an agriculture that endeavours to reduce fossil inputs (especially oil) and climate-damaging emissions? What institutional framework is needed? (Forum 4)
The fourth forum was especially rich with discussions, as there were representatives from both the developing and developed countries and NGO representatives as well as representatives from government and the WTO. Therefore fewer points of consensus were reached; however, there were lively debates on the issues which were addressed.
- When looking at whether greenhouse gases can be reduced through regionalization, there was at least a consensus that not only long-distance transport needs to be considered, but rather the entire supply chain needs to be examined.
- However, while some argued that regional trade can make a significant contribution to decrease the level of greenhouse gases, other argued that it would not be sufficient, and that global trade has other positive aspects.
- There was a consensus in the forum that agriculture should not be included in emissions trading schemes. Not only would this would discourage sustainability in farming, but also for practical reasons it would only affect large producers who would be able to use the system to their advantage and even force out other competitors.
6) What international institutions do we need for sustainable agricultural development, and what role does the WTO play? (Final plenary session)
At several points throughout the day, the fact some of the most pressing issues of our day are being met with an increasing stalemate at the level of global governance was a point that was stressed at several points throughout the day. This is especially true when taking into account that climate change does and will continue to affect poverty, and that the Millennium Development Goals will be definitely not be reached if climate change is not addressed and emissions are not reduced. Solutions to climate change have to be guided by the needs of the most vulnerable, and the human right to food has to be an important guiding principle.
The last panel addressed the role that the WTO plays in agricultural trade and its shortcomings and strengths in doing so.
- The WTO is handicapped by its isolation. It is purposefully distanced from the UN and cannot address many other issues outside of its trade mandate, nor outside what its members address. It has therefore not yet made any decisions or rulings on climate change or the economic crisis.
- The WTO is a vital framework because its members have equal voting rights and it is transparent. It also has a legal mandate and trade dispute mechanisms, which are lacking in other new bodies such as the G-20. This could be seen as a distinct advantage when it comes to enforcing sustainable agricultural policies.
- The WTO has been historically dominated by US-EU trade disputes, and many documents reflect this and are therefore anachronistic and don’t address the most recent crises and challenges. This dynamic is now changing as new members such as India join and are trying to pursue their interests.
- By its nature, the WTO is a negotiating legal body, and is not interchangeable with other institutions. The overlapping or doubling of international institutions makes things more complicated and slow, whereas more coordination among the organizations is necessary and can be beneficial.
- There was no consensus reached on what framework would be better suited to dealing with the combined issues of development, health, agriculture, and sustainability. Some believed that this would be best achieved by reforming the existing WTO structures, while others argued that perhaps a different UN body should regulate these issues.