reform undertaken by OECD countries. Typical orders of magnitude are found in the study by
Anderson (2002), which suggests optimistically that developing countries might gain $11.7
billion from full agricultural trade liberalisation by OECD countries, but stand to gain $31.2
billion by liberalising their own agricultural policies.7 Given this presumption that
developing countries have much to gain from fully participating in liberalisation efforts, why
then are they apparently so keen to seek exemptions and exceptions which would allow them
to opt out from, or certainly delay, liberalisation in the case of agricultural trade?
The trade liberalisation damages food security argument. One line of argument, now more
widely voiced by development NGOs in the North than by developing countries themselves,
is that openness to trade is fundamentally damaging to food security in developing countries
(see, for example, Madeley, 2000). Critics allege that the market-based model that advocates
the liberalisation of international trade is not appropriate to developing countries. They argue
that further liberalisation of trade and agricultural policies (by developing countries) will not
help, and more likely will hinder them, in achieving their food security goals. They claim that
the liberalisation of agriculture has mainly benefited larger, more export-oriented farmers and
has led to the concentration of land ownership, thus marginalising smaller farmers and
exacerbating unemployment and poverty levels. This argument echoes the distrust of the
pro-trade argument more generally. Proponents of this argument reject the fundamental tenet
of the WTO that allowing countries to take advantage of trade is a good thing. S&D then
becomes a rationale to enable developing countries to avoid making any commitments. For
such critics, the Development Box concept is simply a way of reversing the integration of
developing countries into global markets in general and global food markets in particular. The
evidence does not support this extreme position (for example, the countries with the largest
growth rates of cash crop production also had the fastest growth in food crop production, see
World Bank, 2003) but this does not mean either that agricultural trade liberalisation may not
give rise to specific problems where intervention might be justified (for a more nuanced view,
see FAO, 2003).
The different role of agriculture argument. The agricultural sector in developing countries
has particular characteristics which may justify exemptions from general WTO disciplines.
This includes its importance as a source of employment, contribution to GDP and foreign
exchange. In itself, the relative size of a sector is not a persuasive argument to exclude it from
WTO disciplines. More persuasive is the idea that there may be important spillovers or
externalities from growth of agricultural output in developing countries. Agriculture-led
growth strategies appear to have larger dynamic multipliers for the rest of the economy than
other alternatives in poor developing countries (Delgado et al. 1998). Agricultural growth also
tends to have greater impacts on the reduction of poverty (Lipton and Ravallion, 1995 and
other references in Diaz-Bonilla et al., 2003). Mellor (2000) argues that there has been a
tendency to generalise that economic growth reduces poverty, when in fact it is the direct and
indirect effects of agricultural growth that account for virtually all of the poverty decline.
Agriculture may have a particular role to play as a safety-net in developing countries for
people who are unable to find alternative employment opportunities. Hence the importance of
maintaining the viability of the sector, given the difficulties developing countries would face
in providing alternative sources of employment for the rural poor if the size of their domestic
agricultural sector were to shrink (Green and Priyadarshi, 2001).
The weakness of agriculture argument. Here the emphasis is put on the weak market
orientation, the lack of infrastructure and thus the difficulties developing country agriculture
has in competing, and the consequent need to modernise the sector. For some commentators,
the implication is that agricultural production needs significant support through a combination
7 This comparison exaggerates the gains to developing countries from OECD country agricultural trade
liberalisation because it uses a database which does not take full account of the existence of preferential
market access arrangements.
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