Greater role in WTO will bolster Africa’s influence in new order

What you need to know:

  • African policy wonks are convinced that WTO favours rich nations. In this regard, the Ugandan scholar, Yash Tandon, concluded that the body does not hold solutions for Africa.
  • Despite celebrations of minor gains by Africa in farm and fishing subsidies during the Nairobi MC10, these will only hopefully be realised long after 2020.
  • No seismic breakthroughs are expected in easing tariff peaks or the on-going erosion of preferences and special tariff concessions by rich nations that impede its exports from reaching the market.

Nairobi has, yet again, made history by hosting the just-concluded 10th ministerial conference of the World Trade Organisation from December 15-18, the first to be held in Africa by the highest decision-making body within WTO.

In one sense, the Nairobi MC10 signified continuities in the struggle to remove trade barriers to help developing countries better integrate into the global economy. This idea underpinned WTO’s Doha Development Agenda, launched in 2001 to lower trade barriers and increase global trade.

In another sense, with the Nairobi MC10, the WTO has emerged as a new arena of contestation between the West and the emerging powers in the developing world. The challenge of West’s hegemony in global trade by the BRICS powers — Brazil, Russia, India, China and South Africa — is engendering a re-making of a new world (economic) order.

Three developments are likely to shape Africa’s role in the re-making of the new global (trade) order.

One is the transition from the old West-centric global dispensation to the emerging and largely multi-polar world (economic) order.

AFRICA RISING

Despite the mantra of “Africa Rising”, the continent has to work to emerge from its lowly status as the Cinderella of the old unequal and unjust global economic order.

Ahead of Nairobi MC10, African scholars debated the question whether WTO is the right place for Africa to push this agenda.
African policy wonks are convinced that WTO favours rich nations. In this regard, the Ugandan scholar, Yash Tandon, concluded that the body does not hold solutions for Africa.

It is asymmetrical and unequal and serves as a bastion of the West-centric world order. Since its emergence after the signing of the General Agreement on Tariffs and Trade (GATT) in 1947, the United States and Europe have worked in cahoots with the WTO secretariat to wield immense powers in the body’s processes. As a result, WTO is totally biased against non-Western world, including Africa.

The West’s push for “free trade” in WTO during the Nairobi MC10 was no more than a perfidious attempt to keep Africa and other developing nations at the bottom of the global value chain as a source of underpriced raw materials and consumer of overpriced industrial products mainly from the West. Thankfully, this unbalanced and biased order is crumbling.

THE DOHA ROUND

In this regard, the Doha Development Agenda, launched in 2001, was calibrated to eliminate trade barriers and to integrate developing countries into an equitable global economy. Sadly, 14 years and eight ministerial conferences after, Africa remains in the margins of a largely unequal and unjust global trade system.

WTO also remains an instrument of advancing Western interests at the expense of developing countries like Kenya. And numerous trade barriers by the West keep Africa in thrall, deepening its marginalisation in global trade.

Despite celebrations of minor gains by Africa in farm and fishing subsidies during the Nairobi MC10, these will only hopefully be realised long after 2020.

No seismic breakthroughs are expected in easing tariff peaks or the on-going erosion of preferences and special tariff concessions by rich nations that impede its exports from reaching the market.

Instead, Africa is likely to come under immense pressure to eliminate export schemes such as export processing zones (EPZ) with dire consequences for the much-needed value-addition and industrialisation.

Thus, nothing short of seeing the Doha process through to the end can radically change this global order of things.

WEST-CENTRIC ORDER

Also shaping the future of power in Africa is the West’s efforts to harness its power in WTO to salvage its declining influence in the emerging multi-polar world and counter the growing power of China and India.

In Nairobi, the United States and Europe pushed for the talks to begin on fresh ground. Washington sought to re-define the developing world rubric, arguing that China and India should be treated separate from “small and vulnerable economies” and least-developed nations or poorest nations.

While the latter qualify to be exempted from subsidy reduction commitments, Washington argues that other developing countries should not.

The West sees WTO as an avenue to gain greater access to fast-growing and emerging economies in Africa, Asia and Latin America. Africa’s agriculture and industrialisation is at risk as the West pushes for a new deal that will exempt multinationals from local laws in developing nations.
Challenge by new actors

Finally, a veritable clash between the West and emerging powers in the developing world is poised to emphatically change the future of Africa in global trade in the coming decades.

Emerging powers in the developing world are contesting the old order and working through WTO to gain greater access for their products in European and American markets.

In Nairobi, African nations like Kenya and South Africa questioned the logic by the West of introducing new issues to the Doha Agenda, insisting that it should go through to the end.

China and India accused the West of forcing WTO to abandon the agenda of ending the distortions in the current rule deficit and development deficit global trade order. It is overloading the current Doha agenda with “new issues” such as global value chains, e-commerce, labour, environment, competition policies, investment pacts and state-owned enterprises.

Anti-WTO activists hit the streets of Nairobi, unfurling their visions of a world without WTO. Despite this the rise of WTO membership from 162 to 164, following the formal endorsement of Liberia and Afghanistan as members of the Nairobi MC10, indicated that the body will remain a powerful multilateral platform for trade-related negotiations and the re-making of the new global order into the future.

After Nairobi, Africa should, therefore, deepen its diplomatic capacity to lobby for an inclusive global trade order.

Prof Kagwanja is chief executive, Africa Policy Institute