Asian governments should embrace the global free trade system as a way to lift the region’s millions out of abject poverty, senior development officials told a high-level conference here Monday.
Any cooperation between countries across Asia “should pay particular attention to activities that would help achieve the immense potentials for fair trade expansion unleashed by the Uruguay Round Agreements and the establishment of the WTO (World Trade Organization),” said Jacques Diouf, head of the U.N. Food and Agriculture Organization (FAO).
Diouf’s appeal, made at the opening of a two-day meeting to address poverty and food insecurity in Asia and the Pacific, was echoed by a senior official from the Manila-based Asian Development Bank (AsDB).
“The establishment of an open and non-discriminatory trading system would bring massive benefits to developing economies, and accelerate their progress in reducing poverty,” said G H P B van der Linden, vice president of the AsDB.
At the same time, governments must throw their weight behind developing the region’s rural agriculture sector, Diouf added, since the face of poverty in Asia is largely a rural one.
“Achieving the Millennium Development Goals with respect to the eradication of extreme poverty and hunger critically depends on the allocation of adequate resources for these sectors,” he told the participants, who included ministers of agriculture, parliamentarians, agriculture policymakers and senior bureaucrats from 14 Asia-Pacific countries.
The Millennium Development Goals (MDGs) are a set of eight specific targets government leaders agreed to achieve at the UN Millennium Summit in September 2000.
The first goal was to halve by 2015 the number of people living on less than one U.S. dollar a day and to halve by the same year the number of people who suffer from hunger.
According to AsDB’s van der Linden, the experience of four Asian countries – China, India, Thailand and Vietnam – reveal that poverty is a challenge that can be overcome if states pursue “sustained pro-poor” policies.
Among them are investments in infrastructure to provide the ideal conditions for growth, he said. “Even before the (1997) Asian financial crisis, only about 4 percent of GDP (Gross Domestic Product) was allocated for infrastructure against a required 6-7 percent. Following the crisis, the investment levels have dropped.” The worries over poverty come at a time when Asia is showing a mixed record in filling the stomachs of region’s underclass. Background papers distributed at the meeting revealed that between 1990 and 2002, poverty in the region slid from 34 percent of the region’s population to 24 percent.
China was a key contributor to such an achievement, stated a paper by Raj Kumar, head of the poverty and development division at the Bangkok-based UN Economic and Social Commission for Asia and the Pacific (ESCAP).
“Besides China, the most successful cases of poverty reduction in recent years can be found in Southeast Asia,” it added. “All countries in this sub-region reduced the proportion of people living on less that 1 US dollar a day, with Indonesia and Vietnam having the more remarkable progress.”
However, Asia’s ballooning poverty figures reveal that there is little cause for comfort, since an estimated 768 million people of the world’s some 1.2 billion people who live in poverty come from Asia and the Pacific. Furthermore, one in six people in the region suffer from hunger.
And as Kumar points out, it continues to be largely rural phenomenon, affecting the agricultural sectors, with Bangladesh, Cambodia, India, Indonesia, Pakistan and the Philippines being typical examples.
In Bangladesh, for instance, rural poverty hovers around 37 percent in comparison to 19 percent in urban areas, while in Cambodia there is 40 percent rural poverty as opposed to 21 percent in urban centers and in Indonesia rural poverty stands at 20 percent to the 15 percent in urban areas.
The Philippines, however, has the widest margin, with rural poverty at 48 percent to the 18 percent urban poverty.
But development experts at the meeting told IPS that the WTO will only be a meaningful ally to such a sizeable number of poor if the reforms of the international trading system are achieved.
Foremost in this regard are the high subsidies dished out by the developed world to their respective agriculture sectors. According to the ‘2003 Human Development Report’ published by the UN Development Program (UNDP), developed countries pump in an estimated 311 billion US dollars annually in subsidies to aid their domestic food producers.
“These subsidies are so large that they affect world market prices of agricultural goods, causing direct harm to poor countries,” the report added. The funds pumped into the dairy sector are a typical example. In the European Union (EU), each cow was subsidized to the tune of 913 US dollars, while Japan set aside 2,700 US dollars per cow.
Currently, attempts to overhaul this unequal economic terrain have made little headway, with governments in the E.U. and the United States still cold to the idea of taking decisive measures to end schemes that protect their agriculture sectors.
Trade negotiations at the WTO meeting collapsed last year in the Mexican resort town of Cancun due to the impasse over the industrialized world’s agriculture subsidies.
“If there is a level playing field, the rural poor stand to gain, since their products will be more competitive,” Saifullah Seyed of the FAO’s Asia-Pacific office told IPS. “That will help reduce the large number of rural poor in the region.”
