Bridges Trade BioRes • Volume 3 • Number 19 • 31st October 2003

SUPERMARKETS - A NEW THREAT TO SMALL AFRICAN FARMERS

In Brief

BRIEF CTE MEETING ADDRESSES ILLEGAL LOGGING AND PARA. 51

WTO Members convened on 28 October for the first post-Cancun session of the Committee on Trade and Environment (CTE). The meeting lasted only two hours, as most delegates are awaiting the resumption of CTE special (negotiating) sessions, which are currently postponed until further notice along with all other negotiating groups. Delegates discussed a submission by Japan (WT/CTE/W/233, searchable online) on a bilateral cooperation with Indonesia to combat illegal logging through various measures, including, inter alia, the monitoring of legally logged timber and studies on feasible trade measures against illegally harvested and processed timber that are consistent with WTO rules. The proposal received support from the EC, Switzerland and Norway. Brazil and Venezuela said that the underlying causes of illegal logging, including poverty, tariff peaks and tariff escalation, should be considered. Furthermore, Brazil argued that the issue should not be discussed in the CTE, but in fora outside the WTO. Chile furthermore said that Japan’s statement in the paper that "these measures must be prepared in consistence with the WTO rules" could have implications for negotiations in the special session on the relationship between multilateral environmental agreements and the WTO. One trade source noted that the wording could lead to the interpretation that trade-related environmental measures must be consistent with WTO rules, rather than ‘mutually supportive’.

The CTE Chair encouraged countries to consider how movement on the paragraph 51 mandate could be achieved. Para. 51 mandates the CTE and the Committee on Trade and Development to "identify and debate developmental and environmental aspects of the negotiations, in order to help achieve the objective of having sustainable development appropriately reflected". Thus far, little progress has been made on para. 51, for which the EC was the principle demandeur at Doha. The EC, which has been quiet and reactive on most areas, including environment, did not make an intervention on this point. According to one EU trade source, the EC has not yet had any consultations with Members on environment since Cancun.

In 2004 the CTE will meet three times: in March, July and October respectively.

For a more in-depth account of the CTE meeting see Bridges Weekly, 3 October 2003.

SAVING THE ARAL SEA FROM THE EFFECTS OF COTTON PRODUCTION?

Kazakhstan has announced that it would try to rescue the northern part of the Aral Sea by building a dam between the northern and the southern parts of what used to be the world’s fourth largest inland sea. The dam would be 12.7 kilometres long and is expected to raise the water level to between 38 and 42 metres and to revive the northern shoreline to its previous size. Furthermore, it is hoped that the dam would help to restore the fishing industry in Kazakhstan. If the dam is built, only the northern but not the southern part of the Aral Sea would potentially be saved. However, environmentalists have pointed out that the southern part is in such a bad state that it would be impossible to save it. In the last 40 years, the Aral Sea has halved in depth and lost 90 percent of its volume. In addition to the resulting high mineral content, the water is also contaminated with pesticides and fertilisers. The blame for what has been called the "worst man-made ecological disaster on the planet" has been placed on the agricultural politics of the former Soviet Union, which turned large parts of central Asia into chemical- and water-intensive cotton and rice farming. Experts also point out that not only the Aral Sea has suffered from the chemical intensive production, but also the health of the local population. Sirodjidin Aslov the chair of the International Fund for Saving the Aral Sea (Ifas) said "the impact of those days is disastrous, and most of all on people’s health".

Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan and Tajikistan are spearheading the efforts to restore the Aral Sea, Afghanistan is expected to join the efforts soon.

"Kazakhs "to save north Aral Sea," BBC NEWS, 29 October 2003; "Kazakh dam condemns most of the shrunken Aral Sea to oblivion," THE GUARDIAN, 29 October 2003.

EU FISHERIES POLICIES ATTRACTS CRITICISM FROM ENVIRONMENTAL GROUP

The European Commission and Cape Verde have announced the extension of their fisheries agreement until June 2005. The fisheries agreement determines that vessels from Spain, France and Portugal can fish both tuna as well as demersal species (which are species such as cod, halibut etc. living close to the sea floor). In return for gaining access to the fishing grounds, the EU contributes EUR 680,000 annually to the fishing sector of Cape Verde; 42 percent of this contribution are earmarked for fisheries control and surveillance, and to quality control of fish products. Furthermore the Commission has agreed to add Cape Verde to the list of countries, which can export fisheries products to the EU under the public health rules for these products. WWF has criticised the European cash-for-fishing deals, arguing that due to unsustainable fishing practices in European waters, the EU is now overfishing fishery resources of developing countries (see BRIDGES Trade BioRes, 10 October 2002). The Cape Verde fisheries protocol is only one out of several fishing agreements the EU has negotiated with developing countries under the framework of the Cotonou Agreement and the so-called Economic Partnership Agreements (EPA), which is currently being negotiated between the EU and several African, Caribbean and Pacific countries.

In related developments, a report from the International Council for the Exploration of the Sea (ICES) urges European countries to ban the fishing of cod in northern European waters so as to allow fish stocks to recover and prevent extinction. The ICES also gave this advice to the EU member states last year, which at the time decided only to limit the number of days per month and the fishing quotas of trawlers in the North Sea, instead of implementing a complete fishing ban. The EU sets the annual fishing quotes every year in December.

"Scientists call for cod fishing ban," ENS, 22 October 2003; "EU and Cape Verde extend fisheries protocol by a year," EU, 27 October 2003; "EU is failing to halt overfishing in Africa, says WWF," REUTERS, 24 October 2003.

US MANDATORY FOOD LABELLING MAY BECOME PRICEY

According to the US Department of Agriculture (USDA), American food producers may have to spend up to USD 3.9 billion for the mandatory origin labelling of beef, lamb, pork, fish, perishable agricultural commodities and peanuts when this law comes into effect after 30 September 2004. Despite resistance from the republican-led House, farm state senators have passed the labelling law, arguing that international and domestic consumers would buy more US food products if given the knowledge and choice of origin country. An USDA study found however, that there was "little evidence that consumers are likely to increase their purchase of food items bearing the U.S. origin label". Kenneth Clayton, associate administrator for the Department’s Agricultural Marketing Service, said that prices might increase in grocery stores to offset the extra costs. Jon Caspers, an Iowa pork producer and president of the National Pork Producers Council, believes that this law will harm exports, as the increased prices would lower their competitive advantage. Furthermore farmers argue that the labelling procedure would be too cumbersome to implement as they have to keep record of where the animals were born, raised and processed. The Department estimated that farmers and packinghouses would probably spend USD 3.3 billion to separate pigs, cattle and sheep before they are slaughtered, with record keeping costs amounting to at least USD 500 million. Food companies, grocery stores and meat packers have mounted a campaign to repeal this law; consumer groups, industry officials and others involved have until late December to submit comment on these regulations.

"USDA: Food labels to cost US industry $3.9 billion," REUTERS, 28 October 2003; "Critics say country-of-origin food labels hurt, not help, economy," OKLAHOMA DAILY, 28 October 2003; "US Doubles food labels cost estimate," YAHOO NEWS, 28 October 2003.

According to a new study from the UN Food and Agriculture Organisation (FAO), small farmers in Africa risk being marginalised as supermarkets spread. New supermarkets are being established at a rapid rate across urban areas and rural centres in Eastern and Southern Africa, and the traditional supply and distribution systems for food, in which small farmers play an important part, are being disrupted. Millions of small farmers need to adapt to survive. In the words of Kostas Stamoulis of the FAO, "if we don’t help small farmers tap into the supply game and become players in this new market they will be left on the sidelines". In terms of benefits, the spread of supermarkets could provide a stable market for farmers’ produce, as well as create transport and distribution jobs. In order to enjoy these benefits, however, the small farmers need assistance and resources to, for example, set up cooperatives and associations to meet the volume of supply requested by the supermarkets, and learn to negotiate with large companies. Further, credit schemes could be set into place to allow small farmers to buy technology they need in order to meet new food quality and safety standards. In South Africa, 55 percent of food is sold in supermarkets, and in Kenya 200 supermarkets and 10 hypermarkets account for the same amount of sales as 90,000 small shops. The trend is unlikely to be reversed; hence the need for small farmers to adapt.

"Rise of supermarkets across Africa threatens small farmers," FAO Release, 8 October 2003.