1. CONTEXT: An agricultural policy review “particularly with regard to food security, and sustainable development” is mandated in Chapter 14a) of Agenda 21.  In 1997, the General Assembly recognized the provision of sustainable food security (and adequate housing) as [t]he greatest challenge to humanity.”  The present context of the Chapter 14 review in the CSD dialogues is to determine which trade liberalization and globalization policies might promote sustainable agriculture, rural development and food security. Both the mandate of the CSD and its demonstrated ability to facilitate multi-stakeholder debate in a transparent fashion make it well suited to host a frank and vigorous dialogue among Major Groups and CSD delegates on the policies needed to address Chapter 14 issues.

2. ISSUES: The following paper presents four issues pertinent to the nexus of food security, sustainable agriculture and agricultural trade liberalization. The issues are: a) how to reduce the trading of agriculture commodities at prices below their cost of production, i.e. “dumping”; b) how to analyze the impact of agriculture market concentration on sustainable development and food security; c) how to develop sustainable agriculture indicators to assess the economic and environmental impact of globalized agricultural trade and investment; and d) whether a Convention on Sustainable Food Security would be a viable instrument to create coherence and focus for sustainable food security policy at the multilateral level.  While Major Groups and CSD delegates may not agree on policies to address these issues, we hope that they will agree that each issue merits debate and the deliberation at the CSD.

3. PROPOSED INSTITUTIONAL ACTIONS: First, the CSD should request the Food and Agriculture Organization (FAO) to use existing research and develop new methodology to determine national cost-of-production and export price statistics for major agricultural commodities. This request should target in particular agricultural commodities defined as crucial to national and household food security. The CSD should request technical expertise to develop uniform accounting procedures to calculate export price and cost-of-production figures, including externalized environmental costs.  Where resources were lacking for a national report and/or where market structures for crucial commodities were similar within a region, FAO could provide a reporting methodology and technical assistance that enabled smaller nations to work together to issue a regional report.  These reports would be the basis for World Trade Organization (WTO) negotiations to phase-out of the dumping of agricultural commodities at prices below the cost-of-production.

4. The harmful effects of such dumping, currently permitted under WTO rules, have been well documented by NGOs.   Developing country farmers, unable to compete with dumped imports, are driven off the land into already overcrowded cities, resulting, in the words of an Argentine diplomat, in “more rural poverty, more environmental degradation, lower industrial salaries and more social unrest.”   The WTO discussion toward reducing agricultural dumping has been mired in endless debate over what constitutes a “trade-distorting” subsidy. The negotiation of anti-dumping disciplines through a simple comparison of export prices and cost-of-production figures would provide a way to break this deadlock and to move towards resolution of this problem, which distorts trade, and damages the environment and food security.  Even if WTO members failed to negotiate a phase-out of dumping, cost-of-production figures could be used by governments to assist national agricultural and food security planning.  Major Groups could use such figures, for example, to draft national agricultural legislation proposals and to build technical capacity for environmentally sustainable food security.

5. Second, the CSD should request the United Nations Conference on Trade and Development (UNCTAD) to assist governments and Major Groups to report on the concentration of market power in national and regional markets for agricultural commodities and sources of agricultural inputs. UNCTAD has an on-going mandate to work on restrictive business practices and the structure of commodity markets that would provide invaluable background for this work. These reports could include analytical summaries of major mergers and acquisitions; case studies of market concentration impacts for producers, food industry workers, and consumers; reports on national legislation and enforcement of laws concerning anti-competitive business practices; government assistance offered to and received from major agribusiness companies; and the impact of market concentration on food security, rural development and the environment. Governments and Major Groups could use the reports for a variety of purposes, including for analysis of agribusiness trade and investment proposals; for preparation of trade and environment policy proposals; and, for dialogue with and proposals to multilateral lending institutions.

6. The concentration of agricultural commodities and inputs market share, particularly by transnational agribusiness companies, has been a principal mechanism for the creation of global agricultural markets.  Proponents of such markets, using the theory of comparative advantage, contend that they enable countries to use their resources most efficiently and to best advantage for their development. According to the theory, each country is supposed to produce those commodities that it produces better than comparatively disadvantaged countries.  By following this theory, developing countries are supposed to generate sufficient foreign exchange to purchase food imports and other necessities. Some commentators even argue that a high degree of concentration in agricultural production and trade is more “eco-efficient” than in markets structured by less concentration. Annual national or regional reports on market concentration in agricultural commodities would test such contentions, and offer evidence to justify the restoration of competition to markets where its suppression has had a negative effect on sustainable agriculture and food security.

7. Third, CSD 8 should seek funding and the technical assistance of relevant UN agencies to hold a multi-stakeholder meeting to develop sustainable agriculture indicators.  Such indicators could be used to measure the impact of agricultural trade liberalization on sustainable agriculture. For example, they would be a tool for the implementation of the environmental review of WTO Agreement on Agriculture (AoA), called for by CSD 3.  Such a review could be carried out on a case study basis similar to the studies produced for the FAO Symposium on “Agriculture, Trade and Food Security” (held 23-24 September 1999 in Geneva).  In addition, in the context of CSD 9’s focus on transportation, the CSD could commission studies of the impact of current agricultural commodities transportation on climate change. These reports could be used as part of the WTO’s national-level Trade Policy Reviews. A CSD facilitated synthesis of ongoing research in sustainable agriculture indicators could also inform the direction of agro-environmental work in the UN system and among member states. In cases where smaller nations could not finance participation in a process to establish and apply such indicators, member states should commit resources to permit their participation and use of the indicators.

8. Fourth, the CSD members should consider calling on the General Assembly (GA) to authorize a special Intersessional to consider proposals for a Global Convention on Sustainable Food Security.  The special Intersessional report and accompanying studies from governments and Major Groups could be used by the GA to help determine whether there was sufficient interest and capacity for the GA to authorize the creation of an International Negotiating Group (ING) to prepare Convention negotiations.

9. At the World Food Summit in 1996, more than 1,200 non-governmental organizations supported the development of a “Code of Conduct on the Right to Food” and a “Sustainable Food Security Convention.”  (It should be noted that many NGOs do not believe that a Food Security Convention process is a viable means of improving food security.)  The elaboration of the Code is now underway at FAO and the UN High Commission on Human Rights. Without a multilateral negotiating forum, proposals for a Convention cannot be refined by governments and other stakeholders into legal instruments to realize Chapter 14 objectives. CSD members should consider using the mandate of Agenda 21’s Chapter 39, “International Legal Instruments and Mechanisms,” to propose that the General Assembly authorize the creation of an ING to prepare negotiations for a Convention. Notable precedents for such preparations would be the United Nations Framework Convention on Climate Change and the Convention on Biological Diversity.

10. In considering the elaboration of a Sustainable Food Security Convention, CSD delegates and Major Groups should acknowledge the evidence that agricultural trade liberalization has had negative impacts on food security, particularly in developing countries.  For example, FAO presented such evidence in its 23-24 September 1999 symposium on agricultural trade and food security.  This evidence was used by a group of developing countries to present a 7 October proposal to enhance food security as part of their preparations for the WTO Ministerial Conference held in Seattle.  Among the proposal’s many policy recommendations was to “[o]pen up the existing Special Treatment Clause for use by all developing countries for food security purposes.”   This policy proposal was among the “non-trade concerns” that was criticized in the preparations for the Seattle Ministerial as being a “disguised barrier to trade.” WTO negotiators are unlikely to come to agreement in the near future about how to implement Article 20 of the Agreement on Agriculture, which calls for a review of the agreement that takes food security impacts into account. Nor are WTO members likely to agree on soon other proposals to the WTO to support food security. An alternative forum to negotiate multilateral solutions to food security is needed, one that could help set some parameters for multilateral trade negotiations on agriculture.

11. These proposed Institutional Actions should receive the support of and expertise of grassroots-level organizations, particularly in developing countries.  To that end, the CSD should request United Nations agencies, Major Groups and governments involved in implementing these Actions to design grassroots participatory research and consultation processes.  Such processes could be used, e.g. to determine cost of production figures and dumping impacts; to develop sustainable agriculture indicators; and to solicit proposals for a possible Food Security Convention.  The CSD should request that agencies, Major Groups and governments seek dedicated funding to enable grassroots level organizations to participate in the aforementioned processes.

12. POSSIBLE PARTNERSHIPS: Major Groups that have historically been active in public education and/or technical capacity-building for food security and sustainable agriculture should initiate dialogue with organizations that may not yet have recognized their vested interest in improving food security and sustainable agriculture.  Examples of such organizations would include agricultural and rural bankers associations whose clients are going out of business due in part to present policy regimes, and insurance companies whose financial viability depends on reducing the impact of catastrophes caused by ongoing environmental deterioration, rural-to-urban migration and other factors.   Agricultural cooperatives, member organizations and businesses, particularly those that have been harmed by below cost-of-production prices for commodities, by wholesale or retail market concentration, or by the externalization of environmental costs, may also be willing to discuss and perhaps support some of the institutional actions outlined above. In designing and executing the proposed Institutional Actions, Major Groups, UN agencies and governments should interface academic and grassroots expertise. For a successful CSD 8, it is vital that there not be separate channels of communication to governments that facilitate a polarization between private sector and public interest Major Groups.  We hope that there will be a full and honest debate on the proposals made here, so that progress in the full implementation of Chapter 14 can be made.