“Free” trade, to the heavy hitters of the WTO, World Bank, and IMF, means they get increased access to the markets of poor countries while the poor countries lose access to their own. Poor countries are required to reduce their own government’s interference (subsidies) in their free market, while the rich countries are allowed to continue subsidizing their own.

In exchange for receiving loans to stimulate their economy, poor countries are required to lower their import tariffs which encourages “dumping” of subsidized commodities from rich countries into their markets, artificially lowering the price and driving local farmers and producers out of business. Haiti used to produce 80% of its own rice; it now imports around 80%.

Oxfam’s Make Trade Fair campaign explains what happens when rules rigged for the benefit of rich countries like the U.S. allow dumping to occur.

from an Oxfam press release from 2005:

Each year the US spends $1.3bn in subsidies to support a rice crop that costs $1.8bn to grow. These subsidies make possible the dumping of 4.7m tonnes of rice on world markets at 34% below the cost of production, hurting poor countries like Haiti, Ghana and Honduras. Developing countries should be allowed to use policies that allow them to develop fragile farming sectors, says the report.

Profits for Riceland Foods of Arkansas, USA – the world’s biggest rice mill – rose by $123m from 2002 to 2003 thanks largely to a 50% increase in exports, much of them to Haiti, which was forced in 1995 to cut its rice tariff from 35% to just 3% under pressure from the IMF.