Globalization, trade reform and the developing countries
Since the first round of trade negotiations under the General Agreement on Tariffs and Trade (GATT) after World War II, multilateral trade liberalisation has progressed at a fairly steady pace, mostly among the developed countries. But the Millennium Round of trade negotiations, if it proceeds, will look somewhat different. Of the 134 members of the World Trade Organization (WTO) in February 1999, some 70 percent are developing countries. This growing developing-country involvement in the WTO, as well as in regional trading blocs and other trade arrangements, represents a distinct break with the past. While there were relatively few developing-country members of GATT, they did take a more active role in the Uruguay Round of negotiations (which were completed in 1993) than they had in earlier rounds. This round saw some substantive progress toward adoption of issues of importance to developing countries. One such area was agriculture, where the Uruguay Round established a new framework for international trade rules encompassing export subsidies, domestic subsidies and market access, while related agreements covered other issues of importance for agricultural production such as sanitary and phytosanitary measures. Still, recognising that the new rules agreed upon were only the beginning of the reform process, the participating countries decided to resume the negotiations in the year 1999. Therefore, with or without a Millennium Round, agricultural negotiations will recommence sometime at the end of this year.
This essay looks at the evolution of agricultural markets leading to the Uruguay Round negotiations and places them in the context of an increasingly global world economy, focusing on developing countries. The essay then considers, also from the perspective of the developing countries, several issues that are likely to arise in the coming negotiations.