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RussiaÂs ban on grain exports as a heat wave parches crops in the worldÂs third biggest wheat exporter has raised questions whether such export curbs break World Trade Organization rules. Russia is not a member of the WTO, and it remains to be seen how its new grain policy will affect its 17-year-old bid to join. But other grain exporters, such as Ukraine, which is also considering export curbs, are part of the global trade referee.
WTO rules are quite clear that members cannot interfere with imports and exports in a way that disrupts trade or discriminates against other members. But in practice most WTO rules aim to stop countries blocking imports  shutting out competitorÂs goods to give their own domestic producers an unfair advantage.
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Saudi Arabia and other members of the oil cartel OPEC (not all of whom are members of the WTO) routinely control the production and hence export of oil to defend target prices, but have not faced challenges at the WTO.
What can be challenged are restrictions on exports designed to hurt competitors. The United States, European Union and Mexico are currently suing China at the WTO over BeijingÂs export duties and other restraints on raw materials. They argue that these make the raw materials more expensive for foreign competitors, putting them at a disadvantage to Chinese processors.
The fact is that many WTO rules have an opt-out for national security, whether that is defence, censorship to protect public morals, special treatment of banks to protect the financial system, or food security.
Article XI of the core treaty of the WTO, the General Agreement on Tariffs and Trade, says that apart from duties, taxes and similar charges, you cannot impose any bans or restrictions on imports or exports such as quotas or import or export licences.
But it goes on to say:
ÂThe provisions of paragraph 1 of this Article shall not extend to the following:
(a) Export prohibitions or restrictions temporarily applied to prevent or relieve critical shortages of foodstuffs or other products essential to the exporting contracting party; Â
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While the right of a country to protect its own food supply is unchallenged, many economists argue that export bans or other restrictions can make a global food shortage worse.
That was certainly the case in the 2008 food crisis when food prices rose to record levels, triggering shortages and riots from Bangladesh to Haiti. There are fears that rising grain prices now could stoke unrest again.
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A proposal in early 2008 by Japan and Switzerland to tighten rules on export restrictions in the light of rising prices drew little support from developing countries.
Even inside the countries that use them, export restrictions can be unpopular and have perverse effects. Export taxes on grains imposed by the Argentine government prompted a rebellion by Argentine farmers in 2008 and have made it unprofitable for small farmers to grow corn and wheat, shrinking harvests of those crops.
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Now the World Bank has called on countries to avoid policies that could precipitate a crisis â such as a food export ban. As the problem wonât be resolved at the WTO, it seems likely that the question of some kind of global âarchitectureâ for food and agriculture will come up at next monthâs United Nations conference on the Millenium Development Goals, or at the next G20 summit in Seoul.
PHOTO CREDIT: Russian grain harvest , WTO protest , Haiti demonstration , Argentine protest
BERLIN Oct 18 (Reuters) - Germany’s Angela Merkel expects
European leaders to produce a “work plan” for Greece at a summit
on Sunday, possibly including a permanent mission of
international lenders to monitor its debts, sources from her
party quoted her as saying on Tuesday.Euro zone leaders meet on Oct. 23 to discuss further aid for
Greece, with countries such as Germany and the Netherlands
frustrated by Athens’ lack of progress on privatisation and
other reforms. Tighter controls are high on the agenda.Merkel told her Christian Democrats (CDU) the summit should
find ways to ensure the euro zone rescue fund, the European
Financial Stability Facility, is used effectively, but that
leveraging it via the European Central Bank had been ruled out,
party sources said.CDU sources present at a meeting with the Chancellor said
she expected the summit to agree on sending countries that flout
EU budget deficit rules to court, a move which could satisfy
banks which have urged European policy makers to toughen their
stance.Markets rallied last week on high hopes for the summit but
Germany’s Finance Minister Wolfgang Schaeuble on Monday tempered
expectations for the summit saying it would not produce a
“miracle cure”.The euro fell for a second day against the dollar on
Tuesday, pressured by weak German investor sentiment data, a
warning on France’s triple-A credit rating and fading hopes of a
comprehensive solution to the debt crisis.Schaeuble also said European governments would adopt a
five-point strategy expected to include a plan to recapitalise
banks and reduce Greece’s debt mountain by asking private
creditors to accept steeper writedowns than the 21 percent
losses agreed last July.The head of the Institute of International Finance bank
lobby group held a meeting on Monday with Herman Van Rompuy, the
EU official who organises summit meetings, to discuss bank
recapitalisation and haircuts on Greek debt, an EU diplomat said
on Tuesday.Greece’s overall debt is forecast to climb to 357 billion
euros ($490 billion) this year, or 162 percent of annual
economic output — a level economists agree is unsustainable.To reduce this mountain, euro zone leaders are racing to
convince banks to accept “voluntary” writedowns of up to 50
percent on their sovereign holdings. At the same time, they are
trying to agree on a blueprint for recapitalising financial
institutions at risk from the deepening crisis.
* Campaign for natural wonder hopes to boost tourismBy Oliver HolmesJEITA, Lebanon, Oct 12 (Reuters) - All too often the centre
of Middle East upheaval, Lebanon has taken a back seat as a wave
of revolts surge through the region. But the small country is
not immune to the tumult around it and tourism here has taken a
hit.At the bottom of the Nahr al-Kalb valley, a trickle of
tourists get almost-exclusive access to the Jeita Grotto,
karstic limestone caves which stretch more than 10 km into the
mountains.Deep in the cave, small metal guideboats make their way
noiselessly along a smooth underground river, rarely passing
each other and never filled to capacity.The sound of droplets from giant stalactites hitting the
water can be heard and the caves are lit up by blue and orange
lights, specially adapted to emit virtually no heat to prevent
mosses from growing in the caves and ruining the delicate stone
structures.”We’ve had a very bad summer,” a Jeita Grotto employee
whispers, as if the quiet of the cave has awarded it a
church-like respect. “During previous summers, we used to get
3,000 to 4,000 visitors a day to the caves, now it’s more like
700.”She said tourists from the Gulf and other Arab countries
make up the majority of visitors.”But we’ve been having big problems.”The biggest problem, this time, comes from neighbouring
Syria where President Bashar al-Assad has been accused of
killing at least 2,900 civilians in a military crackdown against
pro-democracy protests which started in March.Around 600,000 Arab tourists drive into Lebanon yearly
through Syria — the only country Lebanon shares an open border
with as the small country is in a state of war with Israel.
Cutting through Syria is a cheap option for most regional
tourists and they can take the whole family for the summer.But the instability has shrunk tourist traffic through
Syria, which accounts for a quarter of all tourist arrivals to
Lebanon, and Arab arrivals on the Syrian-Lebanese border are
down 90 percent.Employees at the grotto say 10 to 15 buses used to arrive
each day, full of Arab tourists who had come through Syria. Now
two to three buses arrive, they say, and there are no more
queues for the underground boat rides.TOURISM 20 PERCENT DOWN”Lebanon saw a 20 percent decrease in international arrivals
for the first half of 2011,” John Kester, who observes industry
trends at the United Nations World Tourism Organisation (UNWTO).The second half of 2011 could be much worse as the situation
in Syria has since escalated and data from Lebanon’s summer high
season has not been released.”No country is immune from what is happening in the
surrounding region and most people have to travel overland (into
Lebanon),” Kester said.”Lebanon is affected indirectly, not because of what is
happening in the country itself.”Western tourists have shied away from the Middle East after
a wave of popular revolts spread through the region toppling
leaders in Tunisia, Egypt and Libya. Even countries that have
remained relatively stable, such as Lebanon and Jordan, have
seen a decline in arrivals for the United States and Europe.The Jeita Grotto’s general manager, Nabil Haddad, said
visitors from Europe and elsewhere outside the Middle East often
include Lebanon as part of a regional tour.”But when Syria is cancelled, Lebanon is automatically cut
out,” Haddad said.NATURAL WONDER?In an attempt to boost tourism Lebanon has been campaigning
to have the Jeita Grotto chosen as one of seven ‘wonders of
nature’ in an international competition.The cave system, which is home to the longest stalactite on
the planet at over 8 metres (yards), was entered into the
‘New7Wonders of Nature’ contest in 2007 and Lebanon is trying to
shore up votes in the global poll which ends next month.”It is an exercise in PR,” Tourism Minister Fadi Abboud told
Reuters. “We are trying our best to make people vote,” added the
minister, who persuaded his political allies to attend a cabinet
meeting in T-shirts declaring: “I voted for Jeita Grotto”.Jeita has made it into the 28 finalists, along with
Tanzania’s Kilimanjaro and the Mud Volcanoes in Azerbaijan, but
with tourism numbers down Haddad is worried.”Now we are in the final stages,” he said. “People in
Lebanon have not taken it very seriously. Other countries have
done things to promote their (natural wonders) but we don’t get
the feeling that our vote is being promoted,” he added.Some Lebanese say they will not vote for the grotto as it is
too expensive, at over $12, for many Lebanese to visit.BUSINESS AS USUALLebanon has long been plagued by years of conflict, first
during a 15-year civil war and then in 2006 when 1,200 Lebanese,
mostly civilians, were killed during a month-long war with
Israel.The country’s Roman ruins, ski resorts and beaches, 24-hour
nightlife, cuisine and joie de vivre atmosphere make Lebanon
enormously attractive to tourists from around the world during
periods of stability.”Lebanon has always been a destination with big ups and
downs. It always has the ability to recover,” said UNWTO’s
Kester. “Last year tourism was up 70 percent, this year it is
down 20 percent.”Kester said the biggest issue for Lebanon was how it will
adapt to the crisis in Syria.”Tourism in Egypt went down 40 percent this year, but we
expect it to recover. Lebanon will not. They might have to open
up new corridors into the country.”However, Tourism Minister Abboud remains optimistic.”You have to adapt. Most so-called third world countries
do,” he said. “If you are a farmer, you depend on the weather.
If you work in the tourism sector, you depend on security and
the political situation.”
