Transcript - International Cooperative Alliance

WTO/DDA & Cooperatives
JinKook KIM
Agricultural Advisor
International Cooperative Alliance
National Conference on Cooperative Development in India
19-20 December 2007, New Delhi
Today
• State of Play and Prospect of DDA
• DDA impact on Cooperatives
• Myth and Reality of Cooperatives
• Cooperative Starategies
• Epilogue
Brief History of DDA
• DDA: launched in 2001
• Scheduled to conclude in January 2005
- Missed the deadlines many times in
Cancun, Hong Kong Ministerial Meeting
• Ambassador Crawford Falconer, chairman
of the DDA farm negotiations, presented a
draft modalities text last July.
Current State of Play
• In-depth negotiations have been
proceeded in Geneva since the beginning
of September
• Substantial progress has been achieved.
However some technical issues remained
- Domestic subsidy, Special products, SSM,
Sensitive products
Next year plan of DDA
• 3-8 January 2008: Room E meeting
• 26 January : mini-ministerial conference(Davos)
- 23-27 January: World Economic Forum
• 21 January: Falconer start to write the Draft
• Lamy in November TNC: Conclusion of DDA will
be in 2008
Prospect for DDA
• Single undertaking: NAMA, Service
- nothing is agreed until all issues are agreed
• US Presidential election
• US’s TPA (Trade Promotion Act) renewal, even
temporary, seems to be getting bleaker
- mandate allowing administration to put trade deals to
congress for a yes or no, not to amend the lines
• France’s take over the presidency of EU during
the second help of 2008
My view of DDA
• Without a doubt, the upcoming year will be heavily
loaded with political decisions.
• The more aggressive verbal attacks could reflect that we
are getting closer to a deal. Next year will be very
interesting. (Keith Rockwell, spokesman for WTO)
- USTR Susan Schwab criticize Brazil and India
• Blame high, Confidence low in WTO heads into another
year for free trade pact (Bradley Klapper, AP)
• the DDA conclusion will be, at the soonest, at the end of
2009
DDA failure?
• Mrs. Clinton Interview with FT.
• The WTO collapse in midst of dispute is
Good News for the developing countries?
• A NO deal is better than a BAD deal?
Bilateral & Regional FTAs
EU(15 countries)
Population:370million
GDP: 7840billion US$
2004.May
EU Enlargement
(25Countries)
NAFTA(3countries)
Population:411million
FTAA(34countries)
2005
GDP:11100billionUS$
ASEAN FTA
-China, Japan, India
- EU
EUㆍACP Coalition
: 70 Countries
ASEAN(10)
Population: 550million
MERCOSUR(4)
Brazil, Argentina
Uruguay, Paraguay
“The number of regional trade agreements (RTAs) has grown at a rate of 15
per year since 1995, more than five times the rate during the previous
45 years." The number of BTA and RTA negotiations has been at its
highest since the WTO was established.” (FAO)
Speeding up a shift to BTA/RTA
• USA: The Bush
administration has signed
14 free-trade deals and is
negotiating another 11.
• EU said its priority is Doha
but, they have plan B,
more focused deals
especially in Asia.
• Within Asia, the number of
trade deals is exploding.
Impairing developing countries
• Developing countries have less collective
powers like G20
- Big Countries will Dominate the world trade
• Losing the principle of non-discrimination
- No training, surveillance, DSB system in
BTA/RTA
• Risk losing what already agreed
- export subsidy, cotton and DF/QF,
Developed Countries’ press
• UNFCCC in Bali, Indonesia
- Climate friendly environmental products to
combat global warming such as solar
panels, wind mill turbines, clean coals and
energy-efficient lighting.
• Developing countries status differentiation.
- Mr. Kamal Nath has opposed the idea of
terming India as an emerging country.
Eroding the WTO System
• The suspension of the Doha talks could
trigger an increase in the number of rows
• A surge in threats to achieve through
highly successful dispute settlement
system and undermine a WTO itself
• Looking for alternative system for the
future
Impact of DDA on Cooperatives
• The special measures have provided to
cooperatives on the condition that
cooperatives perform a special service to the
community.
- Tax benefits, Loans, Grants, Access to public
works and programs, Special procurements
provision.
• However cooperatives are under threat by the
effect of free trade agreements and rapid
globalization process for level playing field
Potential dangers for cooperatives
• WTO/DDA is moving toward harmonization in
the trade rules, legislation, accounting
standards and all based on the understanding
that enterprises are capital centered
companies
• Without a proper understanding of what
cooperatives are, its identity, practices and
traditional roles in the social economy.
• some of the support measures that
cooperative enjoy today, could be put at risk.
Misconceptions about cooperatives
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Abandonment of original purpose
The perception of large member dominance
Cooperative practices versus principles
Just like any business
Don’t care about members
Government favouritism
Cooperatives are socialistic institutions
Not really a business
Top down cooperatives
(Bruce Anderson, Cornell University)
Opinion Market Management
• Important time to persuade the policy makers,
bureaucrats, stake-holders to understand the
difference from Private Investor Owned Firms in
terms of its birth, identity and roles in the society.
- Cooperative Value
- Roles of Cooperatives for poverty Reduction
- Contribution to the Society and Economy
Reality of cooperatives
• There is no reason to believe an
organization should be any less successful
just because it is a cooperative.
• Coop power in the world
• US
• Rwanda
Major role in the Economy
• At present, there are 568,000 agricultural cooperatives
and 408 million members in the world.
- 800 million individual members and 100 million
employees in the whole cooperative sector
• Market share
- EU: 50% of supplying farm inputs
and 60% of agricultural products
- Canada: Grain 64%, Forest product 73%
- Uruguay: Milk 90%, Brazil: Grain 43%
- Korea: Agri- marketing 40%
- Burkina Faso: Cotton 77%
(source: www.copacgva.org)
Farmer cooperatives Business (US)
(source: Jean –Mari Peltier, 60th Annual Meeting
of NCDC,Huston TX, USA, Jan. 29 – Feb. 2, 2006)
Coffee Cooperatives in Rwanda
• Rwanda is best known for 1994 genocide in which
800,000 people slaughtered during fighting between
Hutu tribesman and their Tutsi rivals
• Since 2001, 11 cooperatives with 15000 members are
created
• The coop’s income has jumped from 650,000US$ in
2004 to 1.2million US$ in 2005 and is expected to reach
3million US$ in 2006.
• The coops are also helping
drive reconciliation between
Hutu and Tutsi farmers.
(TIME, Sep.19,2005)
Brands
Coop’s Multufunctionality
• Coops’ Multifunctionality is more important
than other forms of enterprise
- Poverty reduction through cooperatives
- Preservation of culture and history
- Employment
- Training School of Democracy, Cooperation,
Economy and Organization
- Hidden functions of cooperatives
Cooperative Model of Enterprise
• Cooperative Model, like Democracy, is not
perfect, but it’s better than others
- Those who built the America are not individuals
but cooperatives
• Moreover, in this day and age of corporate
scandals the likes of Enron, WorldCom, Tyco,
Adelphia, one may come to the conclusion that
most cooperatives practice a higher degree of
ethics and exhibit less degree than a lot of public
corporations. (Bruce Anderson, Cornell Univ.)
Reasons for poor performance
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Conflicting goals
Poor management
Poor board performance
Inappropriate strategies or poor
implementation
• Inadequate capitalization
• Lack of member oversight
• Overly sensitive to member concerns
Other Challenges to Cooperatives
• Globalization
• Concentration to MNC
• Consumers’ needs change
• Safety and Quality
• New technology- IT
• Bio-fuel
We need Innovation!!!!!
Strategies to Cope with challenges
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Merge and Acquisitions
Niche Market Developments
Capital Increase
Brand and Image
Social Responsibility
Sustainability
Climate Change Friendly
Training and Education
Epilogue: Age of Information
• Information Quotient is important
- IQ » EQ » NQ » SQ » MQ » IQ
• Information Sources
- USDA, WTO, COPA/COGECA, JA Japan,
NACF Korea, ICA-AP
A SMALL TRUTH TO MAKE LIFE 100%
IF
equal to
Hard Work : H+A+R+D+W+O+R+K
8+1+18+4+23+15+18+11 = 98%
Knowledge :
K+N+O+W+L+E+D+G+E
11+14+15+23+12+5+4+7+5 = 96%
Love :
L+O+V+E
12+15+22+5 = 54%
Luck
:
L+U+C+K
12+21+3+11 = 47%
most of us think this is the most important ???
Then what makes 100% ?
Is it Money ? ... NO ! ! !
M+O+N+E+Y
13+15+14+5+25 = 72%
Leadership ? ... NO ! ! !
L+E+A+D+E+R+S+H+I+P
12+5+1+4+5+18+19+9+16 = 89%
It is OUR ATTITUDE towards Life and Work
that makes OUR Life 100% ! ! !
ATTITUDE
A+T+T+I+T+U+D+E 1+20+20+9+20+21+4+5 = 100%
• Thanks
• [email protected]
• +41 22 929 8812