Discurso na Conferência Ministerial da União Africana - Arusha, Tanzânia, 23 de novembro de 2005

Honorable Minister Juma Ngasongwa; Dear Ministers; Honourable Delegates, It was with great pleasure that I received the invitation to come to Arusha to address the African Union Ministerial Conference on WTO Negotiations. I would like to thank our hosts, the Government and the people of Tanzania, for their friendship and warm welcome to one of the most beautiful places of this wonderful continent. I feel at home in Africa. I have come several times to this land, sometimes accompanying President Lula, sometimes on my own. One of President Lula’s first priorities is the intensification of Brazil’s relations with African countries. This year, for example, I had the pleasure of visiting Dar es Salaam. Shortly afterwards we opened our Embassy there. We are proud of having the largest population of Africandescendants outside Africa. We want to strengthen our partnership in the context of enhanced SouthSouth cooperation. We have a common past, notably the struggle against colonization. Today we face the common challenge of fighting poverty and underdevelopment. A large proportion of Brazil’s population lives below the poverty line. We understand Africa’s predicament; we share its objectives. We are partners in the common struggle to raise the standards of living of our peoples. When President Lula, together with other leaders, launched the initiative to combat hunger and poverty worldwide, he was not thinking primarily of the poor people in Brazil, but, first and foremost, of the millions and millions of human beings living in countries still less fortunate than our own, the majority of them in African countries. The launching of multilateral trade negotiations in Doha four years ago was meant to create an opportunity to conclude the unfinished business of the Uruguay Round. The central idea behind the DDA was, and must continue to be, to redress the development deficit in world trade. New and enhanced rules are required to allow developing countries to reap the benefits of integration into the world economy. Dear friends, True development requires freeing poor countries from the shackles of historic dependency. In the WTO, this means, inter alia, changing provisions that favour a few in the development world to the detriment of the many in the developing world. Although the developed agenda encompasses a series of important issues, it is my considered view that the greatest potential for positive change is in agriculture. This is where we, developing countries, are most competitive and more readily able to participate in the world market. Yet, it is in agriculture where the most glaring distortions lie. Cotton is a case in point. Cotton production is the sole means of livelihood for millions in developing countries, including in some of the most impoverished areas of the world. Our producers not only have to face structural challenges and lack of material resources. They have also to be able to compete with heavily subsidized exports from developed countries. If prices fall in the world market – and historically low prices have prevailed for the past several years – our producers take the hit. Their competitors from the developed world, however, do not. Their treasuries guarantee prices frequently twice as high as those of the world market. The end of distortions in world cotton trade is not something to be negotiated in the context of future rules. It is a legal and ethical right the WTO Dispute Settlement Body has determined we are entitled to under the current rules; rules for which developing countries paid a steep price during the Uruguay Round. The period for implementation of the results of the cotton case is over. Brazil is reserving its rights to adopt countermeasures.

But we sincerely hope that early and full implementation of the WTO ruling will make trade restrictive measures unnecessary and alleviate the unfair treatment dispensed to producers from the developing world. Brazil has been working together with African countries on this matter, trying to ensure that results of the cotton case are fully respected and not undermined by the ongoing negotiations under the Doha Round. We are committed to the cotton initiative launched by four African countries, which must take world cotton trade one step closer to a fair deal. The cotton example shows that increasing market access for our products, through tariff cuts or quotas may be important, but surely not enough. Such measures can be rendered innocuous by other distortive practices. Subsidies of such magnitude as those given to cotton producers in rich countries have the concrete effect of excluding developing countries from the world market. It is blatantly unfair that our farmers be compelled to compete with rich Treasuries. This is why agriculture lies at the heart of the Doha Development Agenda and why it is so important for developing countries. Less than a month before the Hong Kong Ministerial Meeting, negotiations on agriculture are facing a brick wall. The major economies – those responsible for the greatest distortions in agricultural trade – must show the political will necessary to bridge the wide differences that still exist in the negotiations. Developing countries have shown preparedness to shoulder responsibility by providing a contribution in keeping with their capacity. In reality, we face a twin gap: the gap between developed and developing countries; and the gap between industrial and agricultural goods. One gap compounds the other.

The G-20, to which Brazil proudly belongs, is playing a crucial role on both fronts. The G-20 has dramatically enhanced the participation of developing countries in the negotiating process. The transparency and the inclusiveness with which the Group operates have given its members a sense of ownership in the negotiations. It has tabled comprehensive and balanced proposals that are both ambitious and realistic, bearing in mind the specificity and diversity of needs of developing countries. The G-20 has consistently tried to reach out to other groupings of developing countries, such as the African Group, the ACP and the LDC’s. The message of the G-20 is a message of unity among developing countries. I am convinced that only by preserving our unity and strengthening our natural coalition, will we be in a position to ensure that development objectives of the DDA are attained. We are at a key moment in the negotiations and we have to avoid, at all costs, falling into the trap of the old “divide and rule” strategy.

In order to promote our interests, we must work on several fronts. We must foster our common goals, be it the waiver on TRIMs or on adequate treatment for TRIPS and Health. Regarding the latter, developing countries and the African Group in particular should not accept any outcome that would limit the Doha Declaration on TRIPS and Public Health, by placing private gains ahead of the common welfare. Although real to some extent, differentiation among developing countries does not address their deeper needs. It is certain that different degrees of economic advancement exist among developing countries. Brazil does not face the same challenges as a poor country in Africa or a vulnerable economy in the Caribbean, even though more often than not such differences are exaggerated to weaken our common struggle. We must also be able to act together with creativity and solidarity, so as to increase the trade opportunities of the most needed among us. I want, at this point, to address the issue of preference erosion that has often been used to create divisions between groups of developing countries. Unilateral preferences may, arguably, bring some temporary comfort. But preferences cannot guarantee predictable and effective market access in the medium and long run. They are unstable by nature, leaving developing countries hostage to the whims of the providers and to their changing political interests. Due to their inherent instability, these schemes do not foster dynamic growth. Furthermore, other limitations such as sanitary regulations considerably constrain the theoretical benefits of preferences. It is not surprising that they generate a mere US$ 1 billion for LDC’s, a tiny fraction of total world exports, which totalled US$ 9 trillion in 2004. We are not insensitive to the plight of the countries that depend on preferences. Preference erosion is a real problem. This is why adequate transition periods should be allowed and other creative measures must be put into effect to reduce the overdependence on this fragile instrument. This is why Brazil proposed – and its three Mercosur partners agreed – to announce their disposition to offer duty free quota free access for products coming from LDC’s, especially from Africa and Latin America. Other measures can be envisaged for Hong Kong that will help LDC’s and other vulnerable economies to embark on a path of sustainable development. One example of such measures that can yield concrete results is more flexibility on rules of origin, especially on the part of developed nations to LDC´s and other countries that may be affected by preference erosion. This will significantly enhance the possibilities of those countries to diversify their production and/or to add more value to their traditional products.

On this very day, a plant jointly operated by a Brazilian trading company and a Jamaican state enterprise is starting its shipments of dehydrated ethanol. This investment based on state-of-the-art technology can be replicated to other countries and products if more adequate and LDC friendly norms are in place. New and existing investment mechanisms on the part of the World Bank can play a key role in making technical and financial assistance for developing countries a reality. But poorer countries should not be left for themselves in seeking such assistance. It is a moral obligation to see to it that establishing programs with this objective is part of the commitments undertaken by WTO members. After all they are the same countries that constitute the World Bank, the IMF, etc.

In this context, I would like to end with a cautious note of optimism in relation to the Doha Round. I was positively impressed by a recent statement by Prime Minister Tony Blair, who is now holding the Presidency of the European Union. He recalled that agriculture accounts for under 2% of the GDP and roughly the same share of employment in developed countries. The British Prime Minister goes on to say that “the EU and the US must go further, within negotiations on agriculture. We must reduce trade distorting subsidies. We must see a credible end date for export subsidies. We must put an ambitious limit on the number of sensitive products that can be afforded extra protection.” Developing countries cannot and should not compromise their right to development. Developing countries should not accept any attempt to lower the level of ambition of the Round. In the final analysis, what is at stake is the possibility of achieving the development goals of the DDA. Reducing the level of ambition would still be tantamount to limiting the prospects for developing countries, at the same time as they would still be required to make concessions that would reduce their policy-space. This is certainly not the result that all of us have been looking forward for many years, especially since Doha.

Many thanks