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The
worst affected economies tend to be those in Sub-Saharan
Africa, often seen as the "forgotten continent"
because the major powers no longer really bother with
the implications of their decisions on the conditions
of the people in that region. This is a region where
per capita incomes have been falling for more than three
decades now, but the complete apathy which greets such
disclosures in WTO meetings, for example, is testimony
to the powerlessness of these countries despite their
huge natural resources and large populations as a group.
The past few years have been especially hard, as terms
of trade have moved against the African countries quite
significantly. Chart 3 shows the extent of movement
of terms of trade in 1997 and 1998, and Chart 4 provides
an estimate of the impact of this in terms of the GNP
of these countries. It should be noted that these recent
changes occurred in a context of a secular trend decline
in terms of trade for Africa for more than a decade.
Chart
3 >> Click
to Enlarge
Chart
4 >> Click
to Enlarge
All this also helps to explain why the share of all
LDCs in world and developing country output and exports
has not only not increased but even worsened in the
1990s, compared to the second half of the 1980s. Charts
5 and 6 provide some estimates of this. Chart 6 also
indicates that LDC access to net financial inflows and
even official development assistance has worsened in
terms of share of developing countries.
Chart
5 >> Click
to Enlarge
Chart
6 >> Click
to Enlarge
The Uruguay Round was supposed to increase dramatically
the ability of developing countries in general to export
agricultural products, as well as to increase world
prices of such goods because of reduced Northern subsidies.
It is now well known that the fine print in the Agreement
on Agriculture has made it possible for the developed
countries to continue with very high rates of subsidisation
for agriculture. But even the import protection of their
agricultural markets continues to be very high. Chart
7 shows that the incidence of high tariff peaks (that
is, in excess of 12 per cent) is much greater for agricultural
products than for manufactured goods for all three major
developed country trade groups.
Chart
7 >> Click
to Enlarge
In fact, it is now accepted that the supposed decade
of dynamic globalisation has not really offered all
that much in terms of greater market access or even
ability to import, for the whole group of all developing
countries. As is clear from Charts 8 and 9, rates of
growth of export and import for all developing countries
as a group in the 1990s, even before the "Asian
crisis" years of 1997 and 1998 when world trade
actually fell in value terms, were well below the period
of the 1970s which were supposedly characterised by
closed economies, stagflation and relatively high degrees
of protectionism.
Chart
8 >> Click
to Enlarge
Chart
9 >> Click
to Enlarge
If,
despite all this, many Least Developed Countries are
still anxious to gain entry into the WTO, it is because
the fragility of their economic conditions makes them
long for some degree of multilateralism and basic ground
rules. With all its warts and secretive processes, the
WTO is still a better option for most such countries
than overt bilateral control by a particular major power,
which is the state many of them otherwise find themselves
in.
Since most of them are also highly indebted countries,
they are typically also firmly within the coils of IMF
conditionalities which effectively determine all their
major economic and trade policies. Thus, many of them
have been unable to take advantage of special provisions
made for them in GATT, because the IMF, the World Bank
or other creditors simply impose more liberalisation
and government withdrawal on them anyway.
In such a depressing context, the only hope for LDCs
and for smaller developing countries generally, is much
greater unity and an emphasis on concerted positions
in international forums to press for their common interests.
If the Seattle episode makes for that realisation and
helps to provide more unity among these countries, then
those four days may turn out to have been very fruitful
after all. |
