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16-APR-02
Oxfam Says Poor Countries Need Trade
As the annual spasm of anti-globalization protests gets underway in Washington later this week, it's interesting to note that one major civil society organization often identified with criticism of the international trade system has just released a report arguing that poor countries need more, not less, trade.
Oxfam, the renowned advocate for anti-hunger and economic development efforts in the Third World, has not abandoned its hostile attitude towards the trade policies of developed countries. But in its new report, the group mainly criticizes European and U.S. policymakers for a "double standard" that insists on access to overseas markets without making their own markets available for the kinds of commodities and products that poor countries are most able to produce.
"World trade has the potential to act as a powerful motor for the reduction of poverty, as well as for economic growth, but that potential is being lost," says the report. "The problem is not that international trade is inherently opposed to the needs and interests of the poor, but that the rules that govern it are rigged in favour of the rich."
Much of the Oxfam report focuses on trade barriers and subsidies in Europe and the United States that keep poor countries from benefiting from trade, especially those involving textile and apparel products, and food. The report's arguments echo those recently made by the Progressive Policy Institute's Edward Gresser, who showed that U.S. tariffs disproportionately hurt the poorest of the poor abroad, and the poorest of the poor at home as well (i.e., low- income consumers paying high taxes on essential items like clothing and shoes).
But Oxfam is also blunt in repudiating the views of self-styled advocates of poor countries who oppose trade -- and indeed, the whole global market economy. "The extreme element of the anti- globalization movement is wrong," said Kevin Watkins, principal author of the Oxfam report, in a press briefing last week, reported by The Washington Post. "Trade can deliver much more than aid or debt relief."
"History makes a mockery of the claim," says the report, "that trade cannot work for the poor. Participation in world trade has figured prominently in many of the most successful cases of poverty reduction -- and, compared with aid, it has far more potential to benefit the poor. If developing countries increased their share of world exports by just five per cent, this would generate $350 billion -- seven times as much as they receive in aid. The $70 billion that Africa would generate through a one per cent increase in its share of world exports is approximately five times the amount provided to the region through aid and debt relief."
You don't have to agree with every argument in the Oxfam report (we certainly don't) to appreciate that the aid organization is providing an important breath of fresh air in the debate over globalization.
The report flatly repudiates development models that would consign poor countries to subsistence economies or socialism. More pointedly, it offers a direct challenge to elements of the anti- globalization coalition that are actually more interested in protecting U.S. and European markets from competition than in actually helping poor countries develop. At the same time, it challenges pro-trade forces in the developed world to square their policies with their market ideology.
These are arguments worthy of debate, and much more compelling than anti-capitalist ravings, ill-disguised protectionism, or the belief that trashing a McDonald's or a Starbuck's represents a blow for the welfare of the world's poor.
Related Material:
"Rigged Rules and Double Standards: Trade, Globalisation, and the Fight Against Poverty," Oxfam, 2002: http://www.maketradefair.org/stylesheet.asp?file=03042002121618&subcat=5&cat=2&sele ct=1
"America's Hidden Tax On The Poor: The Case for Reforming U.S. Tariff Policy," by Edward Gresser, PPI Policy Report, March 25, 2002: http://www.ppionline.org/ppi_ci.cfm?knlgAreaID=108&subsecid=900010&contentid=250329