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Vows of New Aid to the Poor Leave the Poor Unimpressed

New York Times
December 15, 2005
By KEITH BRADSHER

HONG KONG, Dec. 14 - The United States, the European Union and Japan have taken turns this week at the World Trade Organization ministerial conference promoting plans to provide billions in foreign aid and eliminate trade barriers on exports from the world's poorest countries.

But ministers from those countries are not sure they like what they see. In fact, some of them say that the offers are so littered with obscure exemptions, murky calculations and special conditions that they will not help much, and may even hurt.

Delegates here from some poor countries are so unhappy with rich nations' efforts to help them that they are warning of a possible move to block completion of a global trade agreement.

"It will be very difficult for us to be a party to an agreement that will make us lose our markets," said Madan M. Dulloo, the foreign minister and trade minister of Mauritius and the leader of a 79-nation coalition of low-income African, Caribbean and Pacific countries.

The last W.T.O. ministerial conference collapsed two years ago in Cancún, Mexico, over complaints by West African nations about American cotton subsidies and objections by Botswana to streamlining customs regulations. Proposals in the last few days by industrial nations are meant to avoid a repetition, but they have created new problems.

The biggest difficulties involve plans by the United States, the European Union and Japan to eliminate duties and quota on almost all goods from up to 50 of the world's poor nations, 32 of which are W.T.O. members. Countries on this list complain that rich nations are excluding the few products in which they are most competitive - the United States is leaving out textiles, for example.

But the loudest complaints are coming from other developing countries that are just well off enough to escape the category of poorest countries, but still compete with these countries in many markets.

The matter of bananas, for instance, dominated discussions here on Wednesday night. No Central American nation qualifies for the list of poorest countries. But their ministers said they fear competition some day from the poorest.

Very poor countries like Angola grow few bananas now, but could start doing so if granted trade preferences, said Alicia Martin, Nicaragua's representative here. "Multinationals could very easily go there," she warned early this week.

Sugar-growing countries with incomes too high for special treatment are especially worried that they will lose markets to countries that do qualify for duty-free, quota-free access to markets in advanced economies, especially since sugar cane is a labor-intensive crop that may be appealing to nations with high unemployment.

"Any drastic tariff cut would squeeze us out of the market and leave us with nothing," said Kaliopate Tavola, Fiji's foreign minister and trade minister, while adding that he doubted that the W.T.O. would let this happen.

The proposal for duty-free, quota-free treatment is so divisive among developing countries that even some negotiators from lands that qualify are saying that the plan must be broadened or scrapped.

"We do not want to segregate, or just ask for a few" countries to benefit, said Love Mtesa, the ambassador to the W.T.O. of Zambia, a country that qualifies.

Details of the aid packages being offered to poor nations are also a matter of dispute here.

The United States trade representative, Rob Portman, announced on Wednesday that Washington planned to increase its annual aid to poor countries that may need help if new global trade rules are adopted. The Bush administration plans to seek an increase in assistance by 2010 to $2.7 billion, from $1.3 billion now.

But other American officials said that they could not estimate how much of the increased spending would represent additional foreign aid, and how much would come from redesignating portions of the existing foreign aid budget as trade assistance. They noted that any foreign aid would be subject to Congressional approval, and that some of the money might also qualify as part of an American pledge early this year through the Group of 7 industrial nations to increase aid.

Nongovernmental organizations were unimpressed. "The American money has already been pledged at least once this year," Phil Bloomer, head of the Make Trade Fair campaign for the relief group Oxfam, said in a statement. "Furthermore, it comes with an unacceptable and explicit push for rapid market opening from poor countries, which poses a grave threat to development."

Japan had begun the spate of aid announcements last Friday when it said that it would give $10 billion over the next three years to help poor countries, an offer that was widely reported as a new effort.

But Yoshinori Katori, the Japanese foreign ministry's director general for press affairs, acknowledged at a news conference on Wednesday that the amount was calculated mainly by adding up how much assistance Japan would provide anyway if it continued to increase aid at the same pace as it had been doing in recent years. The $10 billion assumes some acceleration in the average annual increase in foreign aid, Mr. Katori said, while declining to specify how much acceleration.

Lori Wallach, trade director of Public Citizen, a Washington-based consumer group, said that the objections here from poor countries were a bad sign, considering that the current round of trade talks is supposed to focus on promoting economic development. "It sort of says it all when you need a development package to get developing countries to agree to a development round," she said.


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