| OAKLAND, CA - August 21 - Touted as the "road to prosperity," new agricultural trade agreements between industrialized and developing nations are being negotiated around the world. But new reports by Food First/Institute for Food and Development Policy provide evidence that current trade agreements have failed to deliver on their promised goals.
The series of reports exposes how agricultural trade agreements in six countries--Brazil, China, India, Mexico, South Africa, and the United States--has cost the poor jobs and income, has increased rural poverty and inequality, and has wiped out small farms and communities.
"If one wants to see how well these agricultural trade agreements are doing, then one should look to the rural poor, whose lives rely on agriculture," said Dr. Raj Patel, Food First policy analyst and editor of the reports. "What these reports show is that the poorest, whether they're in Mexico, Brazil, India, China, or indeed the United States, consistently lose out from the agricultural export model."
Mexico's experience with NAFTA provides a clear example. Small maize farmers in Mexico cannot compete against the dumping of heavily subsidized corn from corporate farms in the United States. According to the report, this has resulted in an increase of rural poverty from 54 percent in 1989 to 64 percent in 1998. In Brazil, the 10th largest economy in the world, rural poverty remains at about 41 percent, according to the report.
"In the Third World, trade liberalization is often preceded by structural adjustment policies," said Dr. Patel. "This means that levels of government spending on health, education, and social support are dramatically reduced, and stable agricultural pricing policies abandoned in favor of the market. At the same time, subsidies in North America and Europe continue to be applied, which tend to support the wealthiest producers."
The reports note that in each country, small farmers and the rural poor can't withstand market fluctuations as price controls are eliminated when markets open. Thus, agricultural liberalization tends to increase inequality along already existing social fault lines.
"Whether the countries are rich or poor, food exporters or importers, the trends have been strikingly similar," said Dr. Patel. "Agricultural exports have concentrated land in the hands of the wealthiest corporations and largest farms that employ less people and enjoy considerable economic leverage in the world market."
The reports are based on data from United States Department of Agriculture (USDA), the World Bank (WB), and government policy data from each of the nations studied.
Reports are available here.
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