If we needed any more evidence on the declining relevance of the World Trade Organization, we're seeing it this week. WTO Ministerial meetings, like the one taking place this week in Geneva, used to include massive, worldwide news coverage on the development of new global trade rules. But a quick scan of news coverage today turns up very little. Reporters are struggling to find stories. But maybe that is the story: the rapid decline of the WTO as a major international force. And as importantly, where does it go from here?
In the latest Geneva Update, IATP's Anne Laure Constantin writes about the reluctance of governments to let go of the Doha Round of negotiations, even though the world has dramatically changed since the negotiations were launched in 2001. Constantin writes, "Disagreements over what the mandate is about, and how negotiations should proceed, have perhaps never been wider. Observers around the world are wondering what it will take for trade ministers to acknowledge the situation. Denial only allows an unacceptable status quo to prevail for a few more years. Enough is enough."
Will trade ministers have the courage to change course—or continue to stumble down the same endless path? IATP will continue covering the WTO Ministerial over the next few days and let you know.
Adhemar Mineiro represents the Brazilian Trade Network REBRIP. He is blogging from Geneva this week at the WTO Ministerial.
The WTO G-20 Ministers that have met this Sunday in Geneva reaffirmed their position agreed to at their last meeting in Delhi. On the one hand, they reiterated the centrality of Agriculture (or, more specifically, agriculture exports) in the Doha Round. They claimed to want to conclude the round of negotiations. But on the other hand, Ministers of the G-20 continue to wait for others to put forth new proposals on trade, particularly on the reduction of subsidies, before making another move.
Finally, there seem to be strategic differences on how to deal with WTO and the multilateral trade system among G-20 Ministers. While some countries seem to put much of their efforts toward strengthening the WTO and ensuring its main role in the international trade system, other countries seem to be full of skepticism about the WTO and the multilateral trade system. We can expect a number of very interesting debates among member countries of this important negotiating group in the coming years.
The anti-WTO demonstration patiently orchestrated over the past several months by a coalition of Swiss groups (trade unions, social movements and other NGOs) in consultation with the international network Our World Is Not For Sale was set for success. On Saturday, November 28, more than 4,000 people (a huge number by Geneva standards) had gathered on Place Neuve, the starting point of the demonstration. They held colorful banners and consistent messages. Kids and older activists co-existed peacefully. Farmers, workers, musicians and environmentalists had joined the ranks and were ready to walk to the WTO. The protest organizers were thrilled. Alessandro Pelizzari, from the Swiss union UNIA, launched the demonstration with a very unifying speech.
But then the Black bloc decided it would be more fun if they started trashing windows and setting SUVs on fire.
The protest had to be called off after about 500 meters. For those of us who work hours on end trying to make another world possible through a consistent critique of what’s wrong with the current system, this is a blow. Protesters were unable to convey their messages through the media about the need to change trade rules if the world is to overcome the conjunction of crises it is faced with.
I fear that all that will remembered from this demonstration are the burnt cars and broken windows. Eric Stauffer, Geneva’s extreme right leader, will no doubt thrive on this fiasco while proponents of another world will be associated with violence and fear. Was that the kids in black's objective?
IATP's Alexandra Spieldoch is blogging from Rome at the World Summit on Food Security.
Today at the World Summit on Food Security, there was plenty of lofty rhetoric. United Nation's Secretary-General Ban Ki Moon told delegates that "food is a basic right" and "our job is not just to feed the hungry, but to help the hungry feed themselves." And according to Bloomberg, Pope Benedict XVI cited "greed which causes speculation to rear its head even in the marketing of cereals, as if food were to be treated just like any other commodity."
Fine words. But, like so many of the international meetings the past two years on the food crisis, missing from the various statements of government leaders were clear financial commitments and regulatory reforms to address failures in agricultural markets, like speculation.
When it comes to action, the summit represents an opportunity for the Obama administration to lead on a global stage (and according to a new USDA report released today, food insecurity is also hitting close to home). Just prior to the summit, IATP and over 20 other U.S. based organizations wrote to the Obama Administration with 10 ideas for action at the summit. Unfortunately, thus far,“Our officials, along with U.S. agribusiness, are spreading the myth that more intensive production can feed the world, a message that is not only incorrect but dangerous in terms of its harmful impacts on sustainable livelihoods for the majority of food producers, and its exacerbation of the converging climate, economic, water and energy crises,” the U.S. groups wrote.
Today, we also delivered a specific proposal to government officials at the Rome meeting, urging their support for food reserves as a tool to better manage food supplies and address extreme volatility in agriculture markets. Last month, IATP and ActionAid USA organized a briefing in Washington on food reserves and how they might be used at the national, regional and international level.
IATP's Alexandra Spieldoch is in Rome following the discussions, briefing government officials and working with civil society organizations. Government leaders still have two more days to step up.
From November 2–6 last week, negotiators met in Barcelona as a lead up to UN climate talks in Copenhagen in December. However, hardly any progress was made on the two issues that continue to be central to the deadlock: firm emission reduction targets for developed countries and financing that would allow developing countries to limit their emissions growth and adapt to the climate change impacts that are already inevitable.
Sometimes I wonder whether this is a blessing in disguise. Why? Because negotiators seem unable to grapple with how climate change intersects with other critical challenges related to agriculture and water.
In the case of agriculture, its contribution to climate change is significant but its potential for mitigation is high. It is not only a source of livelihood for close to half the world's population but provides food for all of us. Despite these characteristics, agriculture has only recently entered climate negotiations.
Water is another missing element of the negotiations. The climate impact on agricultural production will primarily be mediated through water (and humidity related changes in the presence of pests and pathogens). In Barcelona, UN-Water (composed of 26 UN organizations) released a statement urging climate negotiators to recognize the pivotal role of water in adapting to climate change in order to increase resilience and achieve sustainable development, stating: “Water is the primary medium through which climate change influences the Earth's ecosystems and therefore people’s livelihoods and well-being. [...] The sense of urgency for climate change adaptation and the recognition of the centrality of water therein, have not yet permeated the political world [...]." It added: "Innovative technologies and integrated solutions are needed at the appropriate scales, for adaptation as well as mitigation."
Three days later, in New York, a special event was held as part of the 64th Session of the UN General Assembly’s Second Committee (Economic and Financial), titled “Enhancing Governance on Water" during which experts discussed some of the key issues on the global water agenda, including strengthening the response to climate change through smart water management and reducing the impacts of water-related disasters. The UNGA event emphasized that water issues must be addressed in a holistic manner to address the climate crisis.
Earlier this year, IATP issued a report prior to the World Water Forum titled, Integrated Solutions to Water, Agriculture and Climate Crises. I hope UNFCCC negotiators heed these growing calls for integrated solutions to these global challenges.
The adoption of transgenic, or more commonly termed genetically modified (GM) crops, has greatly transformed the crop industry. Crops resistant to the general purpose herbicide, glyphosate or Roundup, are widely available. More controversy, however, has been generated by the use of Bt-corn hybrids. These genetically engineered hybrids produce a protein derived from a soil bacteria, Bacillus thuringiensis (Bt) that is toxic to some pests but not to humans or animals.
While the biotech industry promoted Bt crops to control Lepidoptera—the order of insects that includes moths and butterflies—and thus dramatically reduce the use of synthetic insecticides, Miguel Altieri in 1999 brought attention to the issue of insect resistance. He pointed out that Lepidoptera have species that have developed resistance to the Bt toxin and that ultimately the use of Bt crops will fail. The continuous expression of the toxin in the crop will create such a strong selection pressure that resistance will be certain to develop.
To overcome the concerns for resistance development, the refuge strategy was developed. The concept is simple in design, but difficult in execution. It was first presented by US EPA in 2000 for corn borer control. It involves planting at least 20 percent of land in non-Bt corn. In cotton areas, at least 50 percent of the cotton must be non-Bt (there is also a Bt cotton). The situation is more complicated for corn rootworm Bt (a stacked trait, containing both rootworm and borer Bt, that is becoming more common).
The thinking behind the refuge is that the resistance genes will be diluted by supplying susceptible moths that can mate with the rare resistant moth. Offspring of these pairings will likely be susceptible to Bt corn. If the Bt corn rootworm is planted, the refuge should be in an adjacent field. Whereas for the corn borer, the refuge can be up to a half mile away. This is because the rootworm mating is local whereas the corn borer moth has a fairly wide range of exploration, although most recommendations prefer that the refuge for both be in the same field.
Monsanto now has a new corn seed that is a triple stacked variety for broad control of corn earworm, European corn borer, fall armyworm, southeastern corn borer, southern cornstalk borer, corn stalk borer and sugarcane borer, as well as corn rootworm. This technology has an EPA approval for a 20 percent refuge in both corn and cotton-growing areas.
The refuge compliance is voluntary, but must be monitored yearly by the major biotechnology seed producing industries. Data for 2008, reported by Gregory Jaffe of the Center for Science in the Public Interest (CSPI) and covered in The New York Times indicate a significant slippage in adherence to the refuge requirement, from a rather consistent 90 percent or above compliance in earlier years. They found:
These are serious breaches of a contract that is made with EPA and the biotechnology companies—and with the public, who counts on the agricultural industry to live up to its stewardship obligations.
CSPI has some strong and common sense recommendations, including the removal of registration of Bt corn varieties until the companies can demonstrate a higher level of compliance; large fines or seed sales restrictions if noncompliance remains high; requiring biotech companies to pay for independent third-party assessments of compliance; and requiring bag labeling to specify refuge requirements.
Why is compliance slipping? One can only speculate. But is it a coincidence that compliance dropped when the price of corn skyrocketed in 2007-2008? At the same time, prices of inputs also increased, squeezing the farmer’s bottom line even more. The refuge requirement is expensive; seed must be segregated, pesticides that might also cause resistance cannot be used and yields on the refuge areas might suffer because of the high pest pressure.
Even more serious is the potential that organic farmers will lose the one best biological control of pests available to them; they commonly spray a mixture of Bt on crops to biologically control the Lepidoptera.
This week in Barcelona negotiators are making one more attempt to resolve some of many differences for a new agreement to implement the United Nations Framework Convention on Climate Change (UNFCC). There are three UNFCC “flexibility mechanisms” intended to enable countries to meet their Greenhouse Gas (GHG) reduction commitments. One mechanism is the buying and selling of “carbon allowances,” i.e., permits to pollute, and “carbon offset credits,” largely based on agricultural or forestry projects to reduce or avoid GHG emissions. Industrialized countries claim that Article 17 of the Kyoto Protocol authorizes them to extend the primary carbon trading market into the world of financial derivatives.
As part of IATP’s preparations for the UNFCC summit, December 6–18 in Copenhagen, Denmark, as a member of the Commodity Markets Oversight Coalition (CMOC), we helped to draft and signed an October 30 letter to Senators John Kerry and Barbara Boxer. The CMOC does not take a position on the overall Senate energy and climate change bill. Instead the letter outlines dangers that the carbon derivatives market poses to the realization of U.S. GHG reduction goals. The letter notes that Congress has yet to agree to fundamental reforms to the financial and commodity derivatives markets in which carbon derivatives would be traded. Indeed, there is strong opposition to most of these reforms from the financial services industry, which has created new loopholes in draft legislation that could induce extreme price volatility in derivatives markets, including that for carbon. Volatile and confusing carbon price signals would delay and inhibit investments in GHG reduction technology. Such investment delay would be a global warming accelerant.
To reduce the likelihood of extreme carbon price volatility, the CMOC letter calls for mandatory exchange trading—in other words, no more trading in the shadow banking markets. This demand is strongly opposed by the Coalition of Derivatives End Users, who claimed in an October 2 letter, that being forced to post the margin requirements to trade on exchanges would harm their economic interests. Most of the signatories to the letter—which originated when the U.S. Chamber of Commerce, acting on behalf of the taxpayer, bailed out “too big to fail” banks—will be trading carbon derivatives.
The CMOC letter also calls for banning commodity index funds and exchange-traded funds from trading carbon derivatives. In a November 2008 paper, IATP showed how the bundling of agricultural futures contracts into index funds was partly responsible for the extreme price volatility in agricultural futures contracts. The role of index funds in driving price volatility was confirmed in a June 24 U.S. Senate investigation of excessive speculation in wheat contracts. This price volatility made the use of futures contracts by both U.S. farmers and developing country importers too expensive and unpredictable. The price increases contributed to food riots in more than 30 countries, according to the United Nations Food and Agriculture Organization (FAO).
Finally, the CMOC letter called on Congress to commission studies on the effects of a carbon derivatives market on agricultural, energy and other non-agricultural futures contracts. The Commodity Futures Trading Commission (CFTC) estimates that by 2017, the carbon derivatives market will trade $2 trillion in contracts. In 2008, the estimated value of all CFTC regulated contracts was $4–5 trillion dollars. No climate change bill should be passed before Congress has had time to review studies on carbon derivatives price volatility and the effect of carbon derivatives on other futures contracts, including contracts where carbon is bought to offset financial risks in the deregulated world of “mixed swaps” (i.e., with both security and commodity features).
Sen. Debbie Stabenow (D-Mich) introduced an amendment to the Kerry-Boxer climate bill yesterday. In it, Stabenow, along with six co-sponsors (heavy on the farm states), outlined an agriculture and forestry offset program for the cap-and-trade legislation (the Kerry-Boxer bill contained only placeholder language on ag offsets).
Stabenow’s bill, dubbed the Clean Energy Partnerships Act (CEPA), offers few surprises. As in the Waxman-Markey climate bill that passed the House last June, CEPA sets up a system in which farmers and ranchers would be eligible to earn carbon credits for certain climate-beneficial practices like no-till, methane capture, and cover crops. Capped industries (like steel plants, coal-powered energy plants, etc.) could then buy these credits, thereby reducing (at least on paper) their greenhouse gas emissions.
So is this good policy? In a word—no. As we’ve written before, offsets themselves are notoriously problematic. They’re hard to measure and hard to verify, and in many cases, it’s tough to say whether the carbon reducing activity would’ve happened regardless of the offset. Example: a cattle farmer who practices good grazing. Should we reward her? Absolutely—let’s make sure she has the support to keep doing it. Should it mean a coal plant can get out of some real emission reductions? I don’t think so.
Agriculture and the climate would be much better served by comprehensive farm policies that recognize that farming can do more than just sequester carbon—it can also benefit the soil, water, and of course, eaters. It’s a point we keep making, but one I think bears repeating. I will credit both Waxman-Markey and Stabenow’s bill for including non-offset programs to incentive climate-friendly ag practices. We need to talk more about policies like those, and less about offsets. Learn more about climate and agriculture here and here.
When USDA Deputy Secretary Kathleen Merrigan toured the St. Paul School Commissary earlier this week, the first thing she talked about was how complicated the logistics are when trying to provide healthier school lunches—particularly for larger urban districts. Heads in the meeting room immediately nodded. (see photo: IATP's JoAnne Berkenkamp and USDA Deputy Secretary Merrigan)
Yet, despite these challenges, the urgency of improving school lunch programs is rising. The Centers for Disease Control reported last month that most kids aren't getting enough fruits and vegetables. And the Institute for Medicine also published a paper last month citing school lunch and breakfast programs as critical to ensuring the health of our children.
Farm to school programs are seen as one tool toward providing healthier food to kids—and communities around the country are recognizing this. There are now over 2,000 farm to school programs around the country.
In Minnesota, we have been working with the Minnesota School Food Service Association to expand farm to school programs. “It’s exciting to see Farm to School participation growing all over the state—in the cities, in the suburbs and throughout greater Minnesota. This movement is growing by leaps and bounds,” IATP’s JoAnne Berkenkamp said in a press release we sent out today.
This fall and early next year, Congress will renew the Child Nutrition Act—an important opportunity to expand resources for farm to school programs.
As Deputy Secretary Merrigan said, "The need is great, the challenges are great, but just because they're great doesn't mean we're not ready to tackle them."