What's the "Group of 22"

What's the "Group of 22"

Reports from Cancun suggest that much of the week has been spent reacting to the proposals of the "Group of 21." (apparently the G22 by now, according to Friday's Economist). This Financial Times story by Guy de Jonquieres and Frances Williams on Thursday, Sep 11 is great: "Third World alliance hits at trade rules". Peter Gallagher has been describing events all week on his blog, here: Peter Gallagher. The Economist covered the G22's proposals on Friday, here: Economist: "The sword and shield"

What is it?

The "G22" is a group of developing countries seeking developed world agricultural trade concessions at the Cancun ministerial meetings of the World Trade Organization's Doha Round.

Who's in it?

The group started with 16 members and has reached 22 by now. Leading members include Brazil, China, India and South Africa. The remainder of the original 16 include Argentina, Bolivia, Chile, Colombia, Costa Rica, Ecuador, Guatemala, Mexico, Paraguay, Peru, Philippines, Thailand. One of the group's selling points is the claim that its members include over half of the world's population.

These countries have common interests, but they also differ in important ways. The Financial Times story below notes, that:

"Brazil, one of the world's most efficient food producers, wants the round to succeed and has traditionally been willing to negotiate pragmatically. But India, which exports few agricultural products, is far less enthusiastic and has consistently adopted a hardline defensive stance."

Why do they want?

They want reductions in developed world (European Union (EU), Japanese, and U.S.) agricultural subsidies and agricultural trade barriers. They also want to avoid corresponding reductions in agricultural trade barriers within the developing world.

They are pressing to substitute their own agenda for the EU-US agricultural proposals advanced a couple of weeks ago, and for the agricultural agenda prepared by Perez del Castillo, the Chairman of the WTO's Trade Negotiations Committee.

Peter Gallagher has provided the text for the G22 proposals here: "G21 Text on Agriculture", the text of Perez del Castillo's draft, here: "No-one happy with draft Cancun decision ", and the text of the EU-US proposal, here: "Trans-Atlantic trade deal ".

How did it form?

From the Financial Times:

"The new alliance reflects developing countries' growing self-confidence after their recent success in bulldozing US objections to a WTO deal on the supply of medicines to the poorest nations. Its formation was also provoked by the US-EU proposals.

Brazil, India and other members were enraged by the two trade superpowers' demands that they limit subsidies to peasant farmers and that developing countries which were large net food exporters be required to lower their import barriers."

The medicine and EU-US agreements were reached in the last month, so it sounds like the G22 came together in the last couple of weeks.

What is going to happen?

From Cancun yesterday (Friday, Sep 12) Peter Gallagher reported that negotiations on all other issues - and there are many non-agricultural issues - is held up by the conflicts over the agricultural issues: "The agriculture 'crisis' ".

On agriculture, "...there is still a wide gap. Meetings...among the main protagonist groups (US-EU, G21, Cairns Group) have been difficult to arrange and have collapsed quickly when they took place. One of the key problems is that the G21 has very limited internal cohesion on some key issues such as the degree to which developing countries (its members) must open their own markets. This means that the Group can't effectively negotiate compromises on its own proposals and no-one wants to deal with them on that basis ..."

This short, readable post then goes on to discuss some of the maneuvering.

According to the Financial Times: (a) there is a question about whether or not the G22 will hold together (note above the differences between members); (b) the EU may be pressed to reduce its subsidies further than many EU nations will accept, (c) the US Congress is only likely to go along with large agricultural support reductions if other countries do so - and it is an explicit part of the G22's program not to do so; (d) success in Cancun will energize the developing countries in future trade fora.

Giving the Economist the last word:

"The poor countries may be in danger of overplaying their hand. Within the multilateral system of the WTO, where each member, regardless of size, is formally equal, the poor world can stand up to the traditional trading blocks. But what is to stop the big trading powers going outside the multilateral system? American and EU leaders hold the keys to the richest markets in the world. If they do not get a multilateral deal they like at the WTO, they can always sign bilateral deals or regional deals with countries of their choosing. President George Bush, it sometimes seems, is as committed to the FTAA (the Free Trade Area of the Americas) as he is to the WTO. And some members of the EU would probably sooner see the WTO incapacitated than the CAP pulled apart."