Financial Daily from THE HINDU group of publications
Thursday, Dec 05, 2002
Industry & Economy
Exports & Imports
Trade barriers stall exports worth $100 b from developing nations
CHENNAI, Dec. 4
BARRIERS erected by developed countries to stop exports from developing countries have hampered trade worth $100 billion a year, according to Mr Lennart Bage, President of the International Fund for Agricultural Development (IFAD).
He said these barriers, which adversely affect the agricultural exports from developing countries, add up to more than double the total of overseas development assistance (ODA) that the developed countries provide.
Since most of the poor people in the developing countries live in villages and practice agriculture, the inability to find proper markets for their produce leads to further impoverishment, he said.
Since IFAD has the specific mandate of eradicating poverty through agricultural development, it is working on highlighting the problems faced by poor farmers due to trade barriers. This could help the international community understand their plight while taking decisions at the trade negotiations, he added.
According to Mr Bage, the recent trends are showing a revival of interests among the major donor countries towards ODA for agriculture and rural development. At the United Nations summit on development at Monterrey, Mexico, earlier this year, it was decided that the US, Canada and the European Union would increase their assistance by 25 per cent over the next three years.
A significant reason for this has been due to the realisation in the developed countries cannot have a safe, secure and stable future if the gap between the rich and the poor people in the world continues to increase. To reduce this gap the countries have realised that agriculture and rural development have to be supported, he said. Otherwise, it would lead to increase in terrorism and other social problems.
While trade barriers for agricultural exports from developing countries need to be removed, there is also need for reducing agricultural subsidies in developed countries, Mr Bage said. While more than a billion people live at an income under $2 per day, a cow in an EU country gets a subsidy of $ 2.5 a day. A Japanese cow, on the other hand, gets $7 a day.
He said IFAD would be preparing a renewed policy document for its involvement in India. Its thrust will, however, continue to remain on tribal development, women welfare and command area development.
Since 1979 IFAD has extended 17 loans to India totalling $380 million on concessional terms, India ranks second among the recipients.
The projects include tribal development in Orissa and Chattisgarh; microfinance support; earthquake rehabilitation in Gujarat; development of rural women; command area development in Rajasthan, Karnataka and Madhya Pradesh.
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