Daily Times

In the Domestic subsidy, there are three domains. Firstly, the Green Box Subsidy does not stimulate the production capability of any state. This subsidy can be granted through direct payments to farmers on the pretext of Infrastructural development, food security and disease control.

The second type of subsidy under the agricultural charter is the Blue Box Subsidy. They refer to the ambiguous perspectives where the developed states attain the benefit of significantly subsidizing under their ambush.

The third and the most contentious box is the Amber Box Subsidy (wt.org.com). These subsidies are trade-distorting subsidies, which might significantly push the products of other nations into servitude in Global markets with the humongous state facilitation for its agricultural production by any state. There is the liberal objective of WTO’s agricultural charter to limit this kind of subsidy.

Apprehension stems from the deliberate ignorance envisaged by the WTO against the developing states. To elaborate, it is a certain reality that developing states are in dire requirement of state support. Factors like climatic changes, food security, dwindling personal capital, dearth of reserves and multiple other reasons make it imperative for the developing states to attain state subsidies for the retention of their agricultural activities. Moreover, the levels for determination of subsidiary limitation have been frozen to the statistical analysis in the years 1986-88. This underlines the irrationality and the mercantilist approach adopted by WTO to favour the developed states whose level of production was significantly higher than the developing states when the targets were fixed. This indifference is the root cause of extreme issues faced by developing states in terms of food insecurity which can be addressed as their assisting hands remained tied to the agreements of WTO.

Concomitantly, these clauses are blatant endorsements of the Mercantilist perspective as the states with food insecurity and agricultural incompetency resort towards the harsh terms of Aids which are again to be procured from the developed states. This illustrates the vicious cycle of mercantilism which has entrapped the developing states in a vice-like grip.

To add insult to injury, the 8% mandatory import of domestic requirement devised by the WTO is also a measure thinly disguised in the ambit of liberalism. This agricultural clause of WTO works against the developing states. For instance, the import of cheap agricultural goods which collectively decrease the prices of agricultural commodities at home is a grave concern. These decreased prices stare directly into the face of farmers who are unable to even meet expenditures of their productions. Consequently, the native producers halt their productions, thus making the state dependent upon the hefty international Spot Markets. So, the agricultural charter of WTO inadvertently patronizes these mercantilist perspectives and enforces them through its clauses according to the aforementioned facts.

Apprehension stems from the deliberate ignorance envisaged by the WTO against the developing states.

Nevertheless, there are Liberal and positive perspectives on WTO’s agricultural charter. Among them is the availability of Direct Foreign Investment in the field of agriculture. These investments are for food securities which bestow the local population with a liberal clause of equal opportunity. Moreover, the foreign investment under the charter concerned builds an environment conducive to the national economic development of the particular developing state. Along with that, it generates jobs which pave the way for capacity building. The capacity building gradually establishes the foundations for the utopian objective of Autarky (Economic self-sufficiency). Notwithstanding these blistering benefits, in many areas, the charter of WTO for agriculture runs contrary to expectations. The problem here lies with the structural objectives of this charter which are in sharp contrast to the developmental ambitions of developing states. To elaborate, direct foreign investment for agricultural prospects is materialized for the procurement of cheap labour and raw materials from developing states, which translates into exorbitantly hefty exports. The revenue generated from these exports is the subject of investors. This revenue is improbable to be spent on the productive and long-term development of the impoverished local masses. For instance, the land lent, leased or sold to foreign investors in Ethiopia under the title of Food security benefits for the local population was utilized to maximize the exports of investors rather than facilitating the native inhabitants – (Tinyande Kachika (2010): Land grabbing in Africa). So, to say, this ostensibly liberal clause is a veiled scaffolding for the advancement of Mercantilist ideology in WTO’s agricultural charter.

In addition, the severe contempt or refrain from the idea of Autarky in the charter of agriculture by WTO underlines the grave consequences of inter-dependence. To unravel, the discretion granted to states to disrupt the international markets through an abrupt halt to their exports highlights the Mercantilist perspective. Because multiple states become dependent upon their regional or international counterparts for the procurement of certain commodities. So, in any uncertain situation, the compromise made by the exporting state would have a grave effect on the buyer country which will suffer without any cause. To substantiate, India which is the second largest exporter of Sugar to the world has unilaterally restricted its export by confining it to 10 million Tons (CNN Business). That the benchmark price of White sugar jumped more than 1% in London after India’s decision (Dawn International), underscores the fact of how states can disrupt the so-called independent and free market under the liberal charter of WTO. Moreover, the apocalyptic burden on the national exchequer of Pakistan to spend $1.5 billion to offset the grave wheat procurement challenges caused by the supply chain disruption of the Russia-Ukraine war highlights an alarming situation. To encapsulate -regardless of causes- the dystopian prospects of inter-dependence without proper measures to obstruct the unilateral/bilateral market disruption mechanisms bear ample testimony to the mercantilist approaches of WTO’s agricultural charter.

Proceeding further, the mercantilist agenda of WTO is also consequential for the developed states. For instance, the role of China as a developing state in WTO’s agricultural charter bestows it with additional leverages despite its humongous economic development (Indianexpress.com). This is because of the rigid and inflexible clauses of the charter, prepared to exploit the developing states. Consequently, the development of the charter is a retrospective event in which China was a developing state as compared to its contemporary development. It allows China to gain substantially while the USA remains helpless in this self-inflicted wound caused by paralyzing the organization in the context of the latter’s aim for the retention of its hegemonic status. To connect this with the mercantilist idea, one must anticipate the benefits and shares usurped- although legitimately- by China. The stakes which were reserved for developing states are encroached upon by China. This deprives the deserving and developing states of their rightful shares because of the Chinese Pacification of their economic appetite for revenue maximization.

To encapsulate, the cause of inaction and disinclination of developed states stems from their economic interests driven by their economic ambitions. To eventuate these objectives, the developed states disenfranchise developing countries and orchestrate an environment conducive to the proliferated agricultural- in this context- growth of the former at the cost of the latter’s sustaining capabilities. For that to materialize, developed states -such as America- are bestowed with inordinately substantial shares -as compared to the developed countries- through which they obstruct the path of any unwanted reforms to come into practice. An example of blocking the judge’s appointment to the Appeals Court of WTO by successive US administrations is worth stating -Deutsche Welle (DW). This particular impediment eclipses the ability of the body to adjudicate International Disputes or Appeals for any transgression. Subsequently, the developed states are granted impunity which emboldens them to make unilateral and Mercantilist decisions.

Concisely, notwithstanding the trivial and ostensible analogy of WTO’s agricultural charter with Liberalist perspectives, the organizational objectives vested in this multilateral global organization germinate from harbouring the economic and political interests of developed states. As the developed signatories of WTO are the major stakeholders of this body, it is improbable that any radical shift would eventuate in the latter without the consent/compliance of the former. So, an egalitarian playfield must be established by taking into account the legitimate concerns of the concerned stakeholders. This can be achieved by organizational rejuvenation and flexibility to practically realize the aim of uniform development for signatory states. Thus, it is axiomatically pragmatic to anticipate the asphyxiation of national autonomies when their mercantile throats and jugular veins are clandestinely slaughtered at the discernible podium of commercial determinism.

(Concluded)

The writer is a student.