ISLAMABAD, June 11: Rich countries led by the United States have cheated the developing countries under the garb of the Doha Development Round of WTO.

This was stated by head of the trade justice campaign, Actionaid Pakistan, Mustafa Talpur at a press conference here on Sunday.

“The entire negotiation process of multilateral trading system has become hostage to the US Congress and rushing towards US fast-track authority — a power with the US president to approve any deal without seeking the consent of the Congress,” he stated.

He said developing countries like Pakistan were the net losers in this process. During the Cancun WTO ministerial, the World Bank had estimated economic gains of $520 billion, of which $350 billion would accrue to the developing countries, lifting 140 million people out of poverty.

The recent bank study shows that under a most likely Doha scenario, the gains would be just $96 billion; $80 billion (some 85 percent) of the gains would now go to the developed countries.

He said this scenario was mirrored by a study by the Carnegie Endowment for International Peace which predicted an increase in the world income of $40-60 billion. But this gain is very unevenly distributed. Similarly, UN studies predict the developing countries will lose $63 billion in revenue.

The Doha round promised to substantially reduce agriculture subsidies of rich countries and provide significant mechanism to developing countries for protection of their agriculture. Instead of reducing the subsidies, rich nations increased it from $243 billion in 1986-88 to $279 in 2004.

In the European Union’s case, subsidies will account for over 80 percent of its total agricultural expenditure by 2010. It is estimated that by 2013, direct payments in the EU will total about $40 billion.

President Pakistan Kissan Ittehad Malik Abdul Majeed said the protection mechanism for agriculture in the developing countries, adopted in Hong Kong, had been diluted by US proposal.

Under the proposed formulas, developing countries will still have to make dramatic cuts to their import duties, permitting a massive increase in market penetration by northern agribusiness. Rich nations are forcing developing countries to open up industrial and service sectors.

Under these proposals, many developing countries will have to make deep cuts in industrial tariff. These reductions will destroy the local industrial base and cause mass unemployment and revenue losses. The emerging Pakistani industries like footwear, electronics, leather, sports and surgical items will be affected.

He said the European Union’s push for intensive services liberalisation will cause privatization of basic services including water, health, education as well as strategic sectors like banking, engineering and distributional services.

The services proposals, if agreed, will further reduce the role of the state in protecting the fundamental rights of the citizens. This will further widen the rich-poor gap and generates poverty rather alleviating it.

Research Associate Sustainable Development Policy Institute Mehnaz Ajmal said sustainable agriculture action group cannot think of one single substantive outcome in terms of poverty reduction, promoting development or protecting health and the environment that will emerge from the talks.

The rich countries must stop cheating the poor people and developing countries should reject the WTO deal.