Trade: An Unequal Opportunity

“No nation has ever successfully developed without trade.” – O’Neil

Edward O’Neil’s article describes the international economic infrastructure that governs trading policies and, in turn, acts to hinder the development of poor countries. Trade is regulated by rich countries through subsidies, tariffs, and import quotas in such a way as to diminish the potential economic advantages for poor countries. Rich countries monopolize trade causing the market to favor the investing country. Subsidies provided by U.S. and European governments give farmers and agriculturalists the ability to produce heavily subsidized goods at significantly lower prices than in developing markets. This results in the local markets of poor countries being flooded with cheap goods from the U.S. and Europe. The agriculturalists of poor countries cannot compete with the prices of these good and are left without profit. (O’Neil 147-150).

O’Neil discusses tariffs and nontariffs as additional barriers to trade, where exporting countries are charged hefty tariffs that prevent profitable gain from exporting goods. The New York Times stated, “Africans find the double attack of subsidies and tariffs especially maddening since they have been told they should trade their way out of poverty, not look for foreign aid.”  Africa’s continual economic depression is exacerbated by subsidies, tariffs, import quotas, and an underlying lack of free trade. (O’Neil 148). These trade policies have left poor countries without financial means to access basic necessities like proper food. O’Neil further describes the effects of these policies; “It is not an exaggeration to say rich countries’ agricultural policies lead to starvation.”

There is a reciprocal relationship between poverty and malnutrition; the limitations set by trading policies have contributed to malnutrition resulting in diarrheal diseases among citizens of poor and disadvantaged countries. The World Health Organization estimates that one-third of the world is well-fed, one-third is under-fed one-third is starving. WHO sites diarrheal disease as the second most common cause of death of children under five. (http://www.who.int/mediacentre/factsheets/fs330/en/index.html).

Map illustrating the presence of undernourishment in the total population.

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