Tanim Ahmed

Duty and quota free market access would predictably be on the top of Bangladesh's agenda when it joins the ministerial meeting of all least developed countries in Lesotho between February 27 and February 29. It is customary to hold such meetings ahead of a full fledged ministerial summit of the World Trade Organisation, which in turn is supposed to be held every two years. The last meeting of the 151-member global trade forum was held in December 2005, but negotiations have stalled since then due to conflicting positions of significant players. However, there are signs of resumption of trade talks at the WTO headquarters in Geneva and with that brightens the prospect of another ministerial summit. The LDC ministerial meet scheduled between February 27 and February 29 is expected to be in preparation for that summit. It has been customary of such LDC meets to conclude with a common agenda.

The outcome of the Lesotho summit would be crucial as far as negotiations from the common LDC platform are concerned. Being small and fragile economies, as well as politically weak, it has been the position of the least developed countries to negotiate together gaining strength in numbers. Alarmingly however, the unity of the least developed countries seem to be in jeopardy due to conflicting interests and rifts among this group appear to be widening since the Hong Kong WTO summit in 2005 when the crack first appeared.

While Bangladesh vehemently attempted to push for a preferential market access to the lucrative US market, other LDC members, especially some of those from Africa opposed the move. They pointed out that under a separate unilateral arrangement of the United States, the 'African Growth Opportunity Act', African least developed countries already enjoyed market access to the United States and were not willing to put much effort into such an agenda. There were however other issues at stake too. It is common knowledge that Bangladesh, being a competitive apparel manufacturer would be in direct competition with African exports of similar categories. Studies also show that the specific items most exported by Bangladesh are also the main apparel items being exported by African LDCs, who would stand little chance in open competition with Bangladesh in the US market. Thus stringent tariffs on Bangladeshi apparels exports to the United States worked as a protection for other least developed countries that they would rather remain than be done away with.

Apparels and the US market are both significant here since behind all the rhetoric of 'a binding, non-reversible commitment from developed countries to allow duty-free and quota-free market access of all products originating from least developed countries' is the attempt to pry open the US market since most other developed countries already offer some sort of a preferential access to the least developed countries. Textiles and apparels become especially significant when Bangladesh pushes for a preferential market access as its exports are singularly dominated by them. The opposition to Bangladesh gaining fully preferential access to the United States was also opposed by a number of developing countries citing its competitiveness. Even during the last WTO ministerial summit there were hints from both developed countries and Advanced Developing Countries that Bangladesh would soon transition into a developing country, hinting that its demands for preferential market access on the plea of being least developed country did not quite hold water. Developing countries further contributed in widening the intra-LDC rift by suggesting that they would be considering providing some privileges to the more 'backward' LDCs that would see Bangladesh deprived.

More recently with the introduction of a bill in the US Congress titled 'New Partnership for Development Act' striving to accommodate all the US preferential arrangement under one umbrella for all least developed countries, there has been active lobbying from within the United States and some African countries to block Bangladesh from the arrangement or introduce such provisions that would effectively bar Bangladesh from receiving benefits under the scheme. Already the bill, meant to cover all products from all the least developed countries, contains separate and more stringent provisions for Bangladesh and Cambodia for their apparels exports. The bill puts quantitative restrictions on eight types of apparels that cover over 90 per cent African apparel exports. This bill would effectively renew AGOA, the American preferential arrangement for African countries, that is set expire soon.

In this context, the LDC ministerial becomes all the more significant and a united stand might well be considered achievement enough.

Bangladesh, as well as other least developed countries not enjoying preferential market access to the United States, should push for putting forward concrete proposals to ensure immediate realisation of preferential market access of 97 per cent of their products to all developed countries that was granted in the last WTO summit but has not seen any progress since. The provision of granting preferential access to LDC products also applies to developing countries but those unwilling to provide it should have to explain why they are not in a position to do so. At least that should be the common proposal of the LDCs. Given the lack of enthusiasm on the part of the African countries to negotiate market access at the multilateral forum as they are more comfortable doing that bilaterally, some observers have stated that there is little benefit for Bangladesh to remain in a group that does not really believe Bangladesh is rightful member.
As far as multilateral trade negotiations are concerned, particularly those under the auspices of the WTO, Bangladesh has typically been in a peculiar position—it became clearly evident at the last WTO ministerial in Hong Kong—within and outside its LDC group. While LDC members are scared out of their wits whenever there is talk of granting privileges to LDCs apprehending that Bangladesh take the largest chunk of the benefits while they are left with virtually nothing, the developing countries block concessions to LDCs citing that it would mean a few of the larger LDCs would 'eat up' all the benefits threatening their exports while the rest of the LDCs or even some of the developing countries would have to suffer.
This was almost what had happened in Hong Kong citing the case of apparels. Notably Pakistan and Sri Lanka were vehemently opposed to preferences to LDCs since they would also benefit Bangladesh, besides of course a number of African countries who were not really vocal. Thus the rest of the least developed countries feel they have much to gain with Bangladesh out of the LDC grouping—something that the developing countries would also like to see. However, market access is not the only issue that would require further negotiations for a common stand. In the question of temporary movement of labour, the African countries are hardly bothered although it is a big issue for Bangladesh. On the other hand many of the African countries are more interested in their agricultural exports, sugar and cotton for instance, where Bangladesh has no interest.

Two other agendas should also take centre stage if the ministers really mean business. Firstly, there should be a concrete proposal for development and immediate implementation of binding modalities for net food importing least developed countries. The main bone of contention at the agricultural negotiations in the ongoing Doha Round negotiations at the WTO, have been subsidies of the developed countries for which advanced developing countries complain they cannot compete in the international market despite having excess food-grain.

While the developed countries do away with their subsidies prices of agricultural produce is bound to rise in the international market eating into the earnings of food importers like Bangladesh. Besides, as the recent crisis in food showed, major producers including China, India, Vietnam and Argentina had all either banned or capped their exports of food grains citing threats to domestic food security. Although international market prices were high and farmers stood to gain by selling their produce for the export market, agricultural producers chose not to participate in that market in order to ensure food sufficiency.

Their plea for food security is absolutely valid but it thoroughly contradicts their negotiating position at the WTO demanding reduction of subsidies, as the recent moves of India in case of rice exports clearly shows. The net food importers, a bulk of which are the least developed countries, should thus demand safeguard measures and special provisions for least developed food importing countries.

Secondly, there is the matter of deciding upon a strategy to negotiate with the Advanced Developing Countries—the likes of India and Brazil—and other large developing countries who typically lead large alliances of 'developing nations' at the ministerial summits. The last two ministerial summits saw such groupings — G90 in Cancun in 2003 and G110 in Hong Kong in 2005—both of which included the Least Developed Countries.

With the Advanced Developing Countries leading such a coalition, they are able to exert more pressure on the developed countries, particularly the United States and the European Union, into conceding to their demands. But it has been painfully obvious from the last two summits that the alliances are effective only as long as the agenda of the large developing countries are not realised. Once they are, the alliance leaders announce success of their mission and send the poorest members packing with consolation prizes in the form of such negligible and trifling concessions as few million dollars as aid for trade or capacity building or some conciliatory wording in an obscure paragraph of the declaration.

Thus, the Least Developed Countries, constituting about a fifth of the entire WTO membership must devise a strategy to negotiate concessions from the developing countries when asked for joining a grand alliance. Thus far the LDCs have joined with no negotiations and have been squarely betrayed. Lesotho should send a clear signal that the poorest countries will throw their support behind an alliance only if the Advanced Developed Countries commit to providing them some form of binding market access commitment.
Presumably there would be counter proposals that such benefits should go to the more backward LDCs and thereby exclude Bangladesh, which might only be a ploy to destabilise whatever political compact there is among the least developed countries.

While some coalitions and civic groups have already indicated their faith in the Livingstone Declaration that came out of an LDC ministerial there prior to the WTO summit in Hong Kong, indicating that the LDC unity is under risk, other observers are actively considering a coalition of Asian LDCs that apparently have more common agendas than the larger LDC grouping. Others have even suggested that Bangladesh should break away from the traditional grouping and negotiate individually.
Whatever the case, concrete negotiating strategies have yet to be developed. No matter what course Bangladesh chooses, it will have to tread carefully and meticulously plan for contingencies and fall back options. Towards that end domestic resources will have to be utilised fully to develop precise positions as regards the main issues being debated at the WTO currently.