Agriculture Subsidies Threaten Smallholder Farmers

The Herald (Harare) via allafrica.com

10 October 2007, Harare
TRADE-DISTORTING subsidies in agriculture are threatening the livelihoods of millions of smallholder farmers in the region and other developing countries throughout the globe.

Deputy Minister of Industry and International Trade Mr Phineas Chihota said yesterday trade liberalisation at the multilateral level continued to erode preferential margins of developing countries through loss of revenue.

The deputy minister was speaking at a three-day workshop on the effects of Economic Partnership Agreements on farmers' rights and their livelihoods in the Common Market for Eastern and Southern African in Harare yesterday.

Mr Chihota said he was disappointed by heavy subsidies extended to farmers in the US and the European that made trade with African farmers very unfair.

The EU and US offer domestic support and export subsidies and largely dump their excess products in developing countries at very low prices.

"It remains a reality that trade-distorting subsidies in agriculture have threatened the livelihoods of many smallholder farmers in the region," said Mr Chihota.

"Concerning negotiations in agriculture, reduction in EU domestic support, elimination of export subsidies, commodity protocols and preference erosion still exist as areas of divergence."

Zimbabwe is currently negotiating EPAs with the EU under the Eastern and Southern Africa configuration.

The region is working towards the finalisation of its offer that is based on a regional sensitive list of 30 percent of the volume of trade between ESA and the EU.

Mr Chihota said: "Trade liberalisation's likely consequences such as loss of revenue and the need to address the supply side constraints require that developmental issues be addressed first to enable the signing of EPA.

"The rationale is that it would be meaningless for ESA countries to have duty-free and quota-free market access to the EU market if they are unable to use them."

Zimbabwe's economy is largely based on agriculture, which contributes nearly 30 percent to GDP.

The ESA region was concerned about the unfair impact of domestic support on trade competition and is proposing that it should be able to adopt appropriate corrective measures such as countervailing duties.

Mr Chihota underscored the need for unity in formulating a vision and objectives that take into consideration developing countries' peculiar economic needs and requirements.

"As a region, we should enhance our production capacity, create new trade and support regional integration under one cause and translate these objectives into tangible benefits as farmers for the development of our economies."

In September this year, Kenyan farmers and activists protested in the streets of Nairobi against what they called unfair trade partnerships pushed by the EU. The EPAs has been put forth as successor to the Cotonou Agreement, which expires at the end of December.

The Cotonou Agreement gives 77 African, Caribbean and Pacific countries preferential access to European Union markets.

Various stakeholders, including civil society organisations, Members of Parliament and farmers from across the country are attending the workshop.