SAINT PAUL, Minnesota It is increasingly asserted that American and European agricultural subsidies inhibit prosperity in the developing world, particularly in Africa. Critics argue that rich nations have aggressively dismantled trade barriers on industrial goods, yet shamelessly refused to do so for agriculture, where many African nations would have a comparative advantage.
Let me outline two reasons why this argument is problematic, and suggest an alternative set of changes in global trade that would have a greater chance of promoting sustainable improvements in many African nations.
First, if Americans and Europeans were to reduce subsidies to their own farmers, it is true that global prices would likely rise. It is also true that this would benefit African farmers of the same crop - say, cotton. The problem is that this would be only a short-term windfall, because cotton farmers around the world (including Africa) would respond by producing more, thus leading to a decline in global prices.
Global cotton prices have steadily declined over the last 50 years, and the trend is similar for nearly every other major global commodity crop. A national economy dominated by one or two commodity crops (the case for many African nations) is subject to violent upswings and downturns as global prices rise and fall. The long-term downward trend in prices for these goods holds a similar fate for economies overly dependent on them.
Second, the environmental sustainability of commodity-crop production is often questionable. Cotton, for instance, accounts for half of all global pesticide use. It is also highly destructive for the soil if sufficient organic inputs are not employed.
In my research in the West African nation of Mali, I have found that the more a farmer is engaged in export-oriented cotton production, the more likely he is to apply chemical inputs that lead to soil acidification and declines in soil fertility.
Yet Mali, under pressure from the World Bank and the IMF, has consistently sought to increase cotton production.
Those who are truly concerned about Africa's development might consider two policy alternatives.
First, many African nations desperately need a greater diversity of export crops. This may mean abandoning free-trade orthodoxy to allow targeted subsidies for promising new export crops. Organics - from carrots to cotton - is one potential high-value niche that some African nations could exploit.
Second, African economies will always be handicapped if they are not allowed to develop industrial and service sectors. Based on the poor performance of some state-owned industries in the 1960s and 1970s - not to mention northern nations looking to open up markets for their industrial goods - the World Bank, IMF and WTO have aggressively sought to dismantle the African industry sector and to remove all protectionist policies for these products.
The irony is that Europe, America and the newly industrialized Asian nations all benefited from protection during their industrial infancy. While I do not anticipate many African nations competing on the world industrial market, there are a number of consumer items whose production could be fostered locally. Rather than importing cheap plastic goods from China, for example, African nations should be allowed to enact protective measures to encourage local production of these items.
While American and European agricultural subsidies may deny Africa some short-term profits, the real crime is that we have aggressively and hypocritically sought to inhibit the development of manufacturing, which might actually help Africa.
William G. Moseley is an assistant professor of geography at Macalester College in Saint Paul, Minnesota and editor of "Taking Sides: Clashing Views on Controversial African Issues."International Herald Tribune:
