While not receiving a particularly large amount of attention in the corporate press, a proposal by the United States to expand its “aid for trade” programs is being rejected at the World Trade Organization (WTO) negotiations underway (update on negotiations). The United States proposal would double the amount of aid it annually gives to development country in exchange for those countries opening up their agricultural, goods, and services markets, moving from $1.34 billion in aid-for-trade grants in 2005 to $2.7 billion by 2010. The proposal has been widely criticized by developing nations at the meeting as another “empty promise” that is once again being discussed without input from developing nations as a way to deflect attention from the WTO’s likely failure to agree on the Doha round proposals due to differences over agricultural subsidies.

The aid proposal will not solve the problems with poverty around the world, and while there is fairly universal consensus that no amount of aid will ever solve the problem of poverty without empowering people, the “aid-for-trade” proposal from the United States will bring less than a penny per day in aid for each person while costing countries $62 billion in lost trade revenue. Poverty has grown during the decade since the WTO’s formation with the number and percentage of people living on less than $1 per day in areas of extreme poverty—primarily the Sub-Saharan Africa and the Middle East—increasing since the WTO began operating. The WTO has not delivered on its promises of income convergence with corporate globalization via WTO guidelines exacerbating income inequality. A United Nations study found that “in almost all developing countries that have undertaken rapid trade liberalization, wage inequality has increased, most often in the context of declining industrial employment of unskilled workers and large absolute falls in their real wages, on the order of 20-30 percent in Latin American countries.” Moreover, the WTO Doha Round of negotiations would at best provide some small gains for developing countries but would likely result in net losses for most other according to a World Bank study of the WTO’s “complete liberalization” strategy. (source)