Trade Policy Note Final-rev08 - Development

Box 15: Catfish, Globalization and the Poor
Many poor communities have invested in aquaculture production in the Mekong Delta of Viet
Nam. Exports of catfish were having impressive success in the United States market and
became a model of how globalization can benefit the poor. However, protectionist groups in
the United States launched a policy of trade harassment against Vietnamese catfish, first by
attempting to portray the catfish as being produced in unsanitary conditions, a claim which
was debunked by the US Department of Agriculture, then by obtaining legislation requiring
the Vietnamese product to be sold as “basa” and “tra” rather than “catfish”. When this
measure had little effect on imports, anti-dumping action was taken, facilitated by Viet Nam’s
“non-market economy” status in United States law, and the fact that, as a non-member of
WTO at that time , Viet Nam had no multilateral rights and no access to dispute settlement
mechanisms. 35
V. AGRICULTURE AND FOOD SECURITY
Agriculture and the MDGs
The large majority of people living in extreme poverty live in rural areas of
developing countries. Most of them are engaged in the subsistence agricultural sector.
In some poor countries, agriculture constitutes up to 80 per cent of the labour force.
Thus, the achievement of MDG1, MDG 3(e.g. in some countries women do over 60
per cent of cultivation work) and others in most developing countries will depend on
the success of reforms aimed at providing higher standa rds of living in the
agricultural sector. Trade policy is an essential component of any such reforms. These
millions of poor people are extremely vulnerable; their livelihoods can be suddenly
undermined by surges in imports of cheap agricultural products. Trade can provide
opportunities for the poor, if their products are able to penetrate lucrative export
markets. Success in policies to raise poor farmers’ incomes at the national level will
be directly linked to the direction taken in the ongoing process of reform of the
international trade regime governing agricultural trade. Developing countries are
actively participating in the current WTO negotiations with the objective of desig ning
an international regime more coincident with development objectives. At the same
time many are further liberalizing trade in agricultural products within the framework
of FTAs.
Complex Multilateral Regime
Trade in the agricultural sector is subject to a multilateral regime of extreme
complexity. The process of “tariffication” conducted in the Uruguay Round under
which non-tariff measures (e.g. quantitative restrictions) and variable levies were
converted into equivalent tariff rates (and all tariff rates were bound) resulted in very
high MFN tariffs in most major importing countries. 36 Market access (at least 5
35 See Lam Quoc Tuan, “Trade in Fisheries and Human Development - Country Case Study -Vietnam ”,
UNDP Asia Trade Initiative on Trade and Human Development, Phase 1, technical support document
(Hanoi: 2003) (available at www.undprcc.lk/Publications/Publications.asp?C=4).
36 An exception to the prohibition of QRs on Agricultural products is contained in Annex 5 to the
Agreement on Agriculture .Section B in that Annex enables developing countries to maintain QRs on
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