Because, dear reader, the apparent row over agricultural subsidies leaves the so-called ‘Third World’ with one weapon of mass retribution: technology services. 

Trade neogotiations are notoriously dull. Jute farmers in Bangladesh and effete lawyers in the US or Brussels might follow them in varying degrees of detail, but the rest of do not care that much.

For most of us, the WTO (and the GATS before it and the GATT before that) are simply a matter of chucking loads of acronyms at a pentasyllabic horror: globalisation. In fact the heads of many mature economies, when asked about ‘the Uruguay Round’, asked for a 'gin and tonic'.

The latest WTO negotiations broke down this week, after ‘last ditch’ talks in Geneva seemed to fail. But who was there? The US of course and the EU of course and Japan of course. And Australia (presumably since that country exports teenaged backpackers and barmaids across the world). And Brazil. And India. And hauntingly behind the scenes, China. And to a lesser extent, Russia.

In world trade terms, the planet is tilting on its axis. On the one hand, it bends backwards as agrobusinesses in the US and Europe dump subsidised surplus products on the developing world. As a result, subsistence farmers who may be located less than 50 miles away from a major local market are undercut on price by produce flown or shipped in from thousands of miles away. You don’t need to be a Geldof to see how obscene this is.

You may not care about that but you might need to take note of it. Here’s why.

The G-word is viewed by most in the developed world as a (profitable) one-way street. Food, armaments and ICT are flooded into developing markets with a relentless (and at times religious) fervour. The recipients do not fall over themselves with gratitude.

Developing economies – including India, Brazil, China and South Africa if you want a two billion plus quorum – do not take kindly to this. Other smaller, poorer countries are set to rally around them.

In the absence of a WTO agreement fit for the 21st century, they have two major means of fighting back. People who thought the WTO impasse was some sort of victory by default ought to think again.

One enforced counter-attack is a likely curb on foreign direct investment (FDI). Such bans have persisted in China – the world’s biggest market, in case you sleep-walked through the 1990s – and to a lesser extent in India. The investment community in India is growing restless with the idea that foreign companies can still wade in to take control of swathes of this exciting market. China has traditionally taken a harder line on FDI to date – but it does so now in the knowledge that the West has more to lose than to gain as a result of any ostracism.

A second factor is the call centre and back office business being ‘dumped’ on the developing world as service industries seek to shred costs for basic support functions.

So many jobs are at stake that the developing world can hardly afford to suspend activities in the service and support sectors. But it could nationalise them or introduce separate tax regimes. And given the arrogance displayed by the world’s richest nations when dealing with the world’s poorest or most populous nations, the mere threat of that might straighten the thinking caps of the other side.

Think it through. If you are a captain of industry in the US or Europe, the tightening around the groin is doubtless a demonstration that they have got you by the balls. That’s funny, many of us had drawn the conclusion that you didn’t actually have any…
Jim Chalmers