The world's existing trading system puts most developing countries at a disadvantage. Agricultural products, which make up the main exports of many developing countries, still face heavy tariffs in rich countries. It has been estimated that developing countries would gain well over US$100 billion a year from trade liberalization resulting in reduced tariffs—much more than they receive in current aid flows (Anderson 2004:14-15, 49).

At the same time, rich countries often subsidize their own farmers and the agricultural products they sell abroad. These subsidies enable the products to be sold on world markets at prices below the cost of production. Such “dumping” practices deprive developing countries of vital export markets and suppress world agricultural commodity prices (Murphy et al. 2004:2-5).

Agricultural subsidies are currently high on the agenda of the World Trade Organization (WTO), which provides a forum for negotiating global trade agreements. The WTO offers some advantages for developing countries in that each country has an equal vote, so developing countries comprise the largest group. Still, the world’s largest trading nations have historically dominated the WTO’s trade negotiations. That may be starting to shift, as shown by the coordinated action taken by developing nations at the WTO’s meeting in Cancun in 2003, where they refused to back down from their demands (CAFOD 2003). Nonetheless, wealthy nations continue to hold enormous trade advantages. Using export credit agencies, they invest millions of dollars each year to build markets for their own exports (Maurer 2003:13). They also pursue bilateral trade agreements with individual or small groups of developing nations. In bilateral negotiations with strong trading powers such as the United States or the European Union, developing countries have a much weaker negotiating position than at the WTO.