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| Features |
| The plight of poor farmers in global trade |
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by
Ayam Maeresa, 13 July 2006
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07:16:03
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For almost three decades, Dickson Syankuku has worked on Mukuyu Farm in Mazabuka in Zambia’s southern province. At the age of 55, he has outlived an average Zambian, whose life expectancy has been cut sharply by HIV and Aids to about 37 years.
After so many years of service, he still turns up every morning to take up his duties as farm storesman. The mere thought of leaving the farm scares him. Being a father of thirteen, Syankuku has no other means of feeding his family.
He has tried farming, especially the staple grain maize, at a small plot he owns in a nearby community, but nothing tangible has been coming through due to drought and lack of access to cheaper farm inputs.
To keep his family alive and probably pay school fees, Syankuku has to stick to his job of US$300 a month.
“It’s not enough but I am managing,” says Syankuku.
But then he is just one of the lucky few at the farm.
Three hundred workers have lost their jobs because of a decision by farm owner, Willem Lublinkhof, to cut
down on running costs.
Lublinkhof—who opened up the 1,600 hectare farm in 1971 as a commercial enterprise producing mainly cereals before going into growing arabica coffee seven years ago—is facing market constraints both in the region and beyond.
At the moment, Mukuyu Farm—which markets its coffee under the brand Munali Coffee—produces about a third of Zambia’s total annual coffee production of 6,500 tonnes.
The farm mainly exports the coffee to European and US markets as raw green beans because of high tariffs that the farmer will have to pay if he tries to benefit from value adding and sends it there as a finished product.
Attempts to export finished products into the region, especially South Africa, have also hit a wall because of a 17 percent tariff on top of unspecified listing fees.
Lublinkhof can only earn US$2.40 per kilogramme of green beans on the market, which he says is JUST a third of the price obtainable on the export market for a finished product.
“The opportunities [to go into processing] are here but we’re subjected to unfair competition,” he says. Lublinkhof is not alone.
Many farmers in developing countries have similar problems. Cotton farmers in Zambia, just as in West Africa, are equally in a fix.
“The cotton industry can be less meaningful to the farmers if international trade does not shift in their favour,” says Joseph Nkole, National Coordinator for the Cotton Association of Zambia.
He says efforts to break into lucrative produce markets are not paying dividends to farmers because of huge export subsidies and domestic support the EU and
US provide to their farmers the wider agricultural sector.
According to a report from Oxfam, the US offered their farmers US$40 billion in farm support in 2003, while the EU’s annual common agriculture policy cost about US$138 billion.
Trade activists say this practice disadvantages farmers from poor countries, whose products become uncompetitive because they cannot face the competition posed by subsidized imports that are then dumped in their countries.
Nkole says this year the association plans to join forces with their counterparts in West Africa to bolster the fight for fair trade.
The call for rich countries to phase out farm subsidies under the World Trade Organisation’s (WTO) Doha Development Round of 2001 has largely fallen on deaf ears.
The original deadline of January 1, 2005, for end of Doha Round was missed and so was the April 30, 2006, deadline for agreement on liberalising trade in agriculture and industrial goods.
Pascal Lamy, the WTO’s Director General, has given the 149 member countries until July to come up with a deal embracing not just agriculture but industrial goods and services.
After the Hong Kong WTO talks last December, pressure is mounting for a deal this year. But reports from Geneva of a deadlock between the EU and US are dampening hopes in developing countries.
“Hong Kong yielded very little…In fact we are now wondering why we keep on going (to the talks), Mundia Sikatana, Zambia’s Agriculture Minister, observes.
He says a deal on agriculture would help lift up least developed countries, a majority of whose people depend on agriculture to earn a living. Further delays, he says, just escalates poverty.
Worse still, observes David Mundia, a permanent secretary in the Ministry of Agriculture in Zambia, is the fact that poor countries lack technical knowledge to participate fully in the trade negotiations.
Zambia’s case is very similar to all its neighbours in the region. Across the eastern border, Malawi is banking on greater market access to prop up its sluggish economy.
Malawian President Bingu wa Mutharika’s vision’s of turning the country from a consuming nation to a producer and exporter will largely depend on greater market access on the international scene.
According to the acting director of trade, Harrison Mandindi, Malawi is interested in a trade deal that gives the country greater access on the export market.
So as the finger pointing continues between the EU and US, farmers like Lublinkhof have no choice but to keep on struggling on the export market.
“This is not a business that you can go in and out,” he says, “it’s a long term investment and the only way out of this problem is to get market access.”
India and Brazil, the leading voices for the developing countries, say there are prepared to make concessions that would allow greater imports of manufactured goods if Washington and Brussels provided better market access for farm goods from poor countries.
—The author is Production Input Editor for Malawi Television. |
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