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Free trade

From June 13 to 15, the World Trade Organization (WTO) will hold its 12th Ministerial Conference. The global food crisis will take centre stage in discussions. Once again, G7 political leaders and wealthy nations are cheering for more free trade as a solution to ensure global food security. Small-scale food producers and global peasant movements, however, are warning that it is the wrong recipe.

Decades of rampant globalisation and expansion of free trade have decimated local economies, increased rural poverty, generated agrarian conflicts, spurred migration, and worsened hunger and inequality. It is time for a radical shift towards guaranteeing food sovereignty everywhere.

Climate change, the Covid-19 pandemic, and the war against Ukraine have created massive disruptions in international agricultural markets and global food systems. The prices of farm inputs and some primary food and agricultural commodities have skyrocketed. Rising food inflation in countries worldwide is threatening to push more people into hunger. Several import-dependent countries are now struggling to import the food needed to feed their people.

Transnational agribusiness corporations seem keen to milk the crisis. They prefer to hoard and export rather than fulfil domestic demand, sometimes forcing national governments to impose export bans to tame rising domestic prices. A recent investigation has found that excessive speculation by investment firms and funds in the commodities markets has contributed to the price spike.

In short, the global food system, sustained by free trade agreements and bilateral investment treaties, is failing once again in the face of significant disruptions. Yet all we hear is chorus calls from wealthy nations for more free trade. It is déjà vu. In 2008, during the global food crisis, international trade was touted as the magic pill to solve food insecurity worldwide. That has just proven to be a tale that could cost the lives of hundreds of millions of people worldwide.

Real solutions were always on the horizon.

For nearly a quarter of a century, La Via Campesina, the global peasant movement, has been advocating that national public policies built on the principles of food sovereignty can build stable, re-localised food systems. Such local efforts can weather the storm of massive disruptions that we see today. Instead of globalising food trade through WTO and other free trade agreements, countries should have the right to protect and promote local food production, regulate agricultural markets, and develop public stockpiling.

Yet, since its 2013 Ministerial Conference in Bali, the WTO has been dragging its feet on finding a permanent solution to public stockholding for food security purposes. A proposal tabled by the G-33 grouping of WTO has been in deep freeze since 2013, despite a majority of the developing nations supporting it. Middle and low-income countries have also been asking for a special safeguard mechanism (SSM) to prevent food dumping, allowing them to raise import tariffs when faced with an import surge. Yet, no solution seems to be in sight, even as the Agreement on Agriculture by the WTO allows a total of 39 countries (17 developed and just 22 developing countries) to use a special safeguard.

Excerpted: ‘More free trade will not solve the food crisis’.

Jeongyeol Kim & Zainal A Fuat & Morgan Ody, "Free trade," The News. 2022-06-09.
Keywords: Economics , Agricultural markets , Trade agreements , Free trade , Inflation , Export , Import , Ukraine , Bali , WTO