Africa's Last Best Chance

The long-stalled Doha round of trade talks recently had, in the words of WTO Director-General Pascal Lamy, a jolt of "new energy" after the recent meeting of key trade ministers in Davos. What is not clearly understood is that if a successful agreement is reached, it will be especially good news for Africa.

Failure, conversely, would have tragic consequences for the continent. It would lead the United States and the European Union to negotiate more bilateral free-trade agreements with key countries, but not with sub-Saharan Africa and other poor countries, which offer few attractive markets for developed countries' manufactured goods and services. Africa, which has seen its share of world trade shrink in recent years, would fall even further behind.
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For the Doha round launched in 2001, however, there is a development agenda. At its heart is agriculture -- a politically sensitive sector in the EU and the U.S. but the largest employer in low-income countries, accounting for about 60% of their labor force and 25% of their GDP. The World Bank estimates that these agricultural products face what former U.S. Trade Representative Robert Portman observed is a practically insurmountable global average tariff rate of 62%, and that 93% of the benefits from a successful Doha round would come from improved market access for developing nations' agricultural products.

Farmers represent less than 5% of the labor force in industrial countries, but they have very substantial political power in the U.S., EU and Japan. These political forces, especially in the EU, led to the eventual derailment of the Doha round last summer. But as the Doha talks take on new life, Congress and the Bush administration need to stay true to the commitments of the Doha Development Agenda, especially in agriculture.

Two weeks ago the administration proposed ending subsidies for 80,000 wealthy farmers, substituting trade-distorting subsidies with cash payments to farmers, and trimming traditional agriculture programs by $4.5 billion over the next decade. These proposals, if approved, would directly benefit some of the poorest people on earth, save lives and ultimately reduce American foreign aid, while helping Susan Schwab, the U.S trade representative, put wind in the sails of the ministers' pledge in Davos to restart serious talks.