Inequalities associated with the global trading system + Letter to Mr David Walker.

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Brian Lockyer

Practical 5

10th September 2009

Dear Mr David Walker

As a third world businessman I constantly bear witness to the inequalities and injustices associated with the global trade system. These inequalities and injustices could potentially be detrimental to the future stability and security of many African economies which primarily rely on the export of agricultural produce for survival (Clapp, 2006:563). The concept of agricultural protectionism is one that is a highly divisive issue that will render many Africans countries becoming susceptible to economic stagnation and ultimately economic declination as their ability to compete in the Global markets is significantly reduced. Agricultural protectionism therefore places an unfair burden on African countries and completely undermines the concept of free and liberalized trade (Clapp, 2006:564). One example can be seen in The United States, the USA spends 2-4 billion dollars annually subsidizing American cotton farmers which have severe repercussions for African farmers (Clapp, 2006:565). In 2003 US agricultural exports sold for anywhere between 10 percent and 50 percent below the cost of production, similarly, The European Union also exports key commodities for less than the cost of production. In other OECD countries, agricultural subsidies rose from US$271.2