This is not surprising. For while trade and
the environment make up the formal agenda of the
meeting, the informal agenda is to press Asian
governments to commit to a new trade talks at the
WTO ministerial meeting in Qatar in November.
This is typical WTO: Use every key inter-governmental
meeting to get governments to fall into line
behind a new trade round. The WTO did this
at the Asia Pacific Economic Co-operation summit in
Brunei last November. It did it again at an
African leaders summit several weeks ago.
As well as twisting the arms of Asian governments
to support a new round of talks, the WTO is
attempting to get backing for a new round
from Asian civil society.
The WTO knows that even if the governments
fall into line in Chiang Mai, civil society opposition at
home could still push them off the bandwagon.
Thus we have a trade and environment seminar for
civil society organisations -- in Chiang Mai
on March 29 and 30 -- fronted for the WTO by the
Geneva-based International Centre for Trade
and Sustainable Development.
Most developing countries are opposed to a
new trade round. They have not yet absorbed the
demands on them made at the Uruguay Round.
Many countries have still not changed their
domestic legislation to make them WTO-consistent. They
are bitter that many lost rather than gained
from the Uruguay Round.
The United Nations Development Programme estimates
that under the WTO regime, in the period
1995 to 2004, the 48 least developed countries
will actually be worse off by $600 million (26.6 billion
baht) a year, with sub-Saharan Africa actually
worse off by $1.2 billion (53.2 billion baht).
The UN Development Programme also says that
70% of the gains of the Uruguay Round will go to
developed countries, with most of the rest
going to a relatively few large export-oriented developing
countries.
Mike Moore, the WTO director-general, and Clare
Short, Britain's development minister, have tried
to sell a new round as a development round.
But the reality is that the main agenda for liberalisation
has more to do with opening up their economies
to greater penetration by northern transnational
corporations.
The "new issues" that the developed countries
want to make the centrepiece of negotiations are
investment policy, competition policy, government
procurement policy, labour standards and
environmental standards.
The object of the first three is to give transnational
corporations national treatment -- that is, to strike
down preferential treatment given to local
producers and contractors. As for labour and
environmental clauses in WTO agreements, developing
countries fear that their intent is simply to
serve as barriers to the entry of developing
country imports while many southern NGOs regard them
as giving the WTO tremendous power in areas
where it does not have competence.
A new round is like a Pandora's box. Once you
open it, all sorts of issues detrimental to the interests
of peoples and countries may emerge. The United
States may even use it to force other economies
to accept genetically modified organisms.
Instead of engaging in a new round of trade
liberalisation, the WTO should spend the next few years
repairing the Uruguay Round so that it does
less harm to the interests of developing countries.
Here are a number of priority issues:
- Trade-related intellectual property rights
should be revised so as to ban the patenting of all life
forms including micro-organisms and to strengthen
intellectual property systems to protect the
accumulated knowledge of local and indigenous
communities from bio-piracy.
- The Agreement on Agriculture should be amended
radically to eliminate tariff peaks and tariff
escalation against southern agricultural exports,
end the massive subsidies for developed country
farming interests, do away with the different
forms of direct income support for developed country
farming interests, institute a food security
exception to market access rules, and recognise the
principle of special and differential treatment
for developing countries that would allow them greater
latitude in their interpretation and implementation
of Agreement on Agriculture rules.
- The Agreement on Trade-Related Investment
Measures must be revised to drop the ban on local
content policies. Trade policy has traditionally
been a mechanism used by developing countries to
industrialise. The ban on local-content policies,
which specifies that a determined amount of a
product be sourced locally instead of being
imported, practically eliminates this positive use of trade
policy for development.
- The special ministerial decision approved
in Marrakesh in 1994 to provide assistance to net food
importing developing countries still has not
been implemented in spite of the fact that the Agreement
on Agriculture has raised the price of these
countries' food imports.
- The WTO must force developed countries to
live up to the commitments they made to lift import
barriers under the Agreement on Textiles and
Clothing. Seven years into the WTO, the United
States, European Union and other developed
countries have scarcely lifted their quotas against
Third World garment and textile imports. For
all intents and purposes, the restrictive multi-fibre
agreements remain in place.
- Last but not least, the WTO decision-making
structure must be overhauled. The "Green
Room/consensus process" has ensured that a
few countries dominate decision-making at the WTO.
Even Charlene Barshefsky, the US Trade Representative
during the 1999 Seattle summit,
acknowledged that the WTO was undemocratic.
"The process was a rather exclusionary one,"
she said. "All meetings were held between 20 and 30
key countries. That meant 100 countries, 100,
were never in the room. This led to the extraordinarily
bad feeling that they were left out of the
process and that the results had been dictated to them by
the 25 or 30 privileged countries in the room."
After the developing countries rebelled against
this exclusionary decision-making process in
Seattle, Stephen Byers, the British minister
of trade and industry, said: "The WTO will not be able to
continue in its present form. There has to
be fundamental and radical change in order for it to meet
the needs and aspirations of all 134 of its
members."
Yet scarcely three months, during UN Conference
on Trade and Development (UNCTAD) in
Bangkok in February 2000, Mike Moore said
the Green Room/consensus process was
non-negotiable.
Decision-making is fundamental. The developing
countries and international civil society cannot
agree to a new trade round unless the inequity
in decision-making is banished from the WTO.
When the WTO came into being in 1995, free
trade was seen as a panacea, a cure for poverty,
inequality and almost everything else. The
Washington Consensus that formed the intellectual pillar
of free trade and structural adjustment seemed
to carry all before it. Today, the situation is radically
different. The alleged benefits of free trade
and free markets are challenged everywhere.
As for the so-called positive relationship
between free trade and growth, the emerging consensus is
laid out by Dani Rodrik, professor in international
political economics at Harvard University: "Do
lower trade barriers spur greater economic
progress? The available studies reveal no systematic
relationship between a country's average level
of tariff and non-tariff barriers and its subsequent
economic growth. If anything, the evidence
for the 1990s indicates a positive relationship between
import tariffs and economic growth. The only
clear pattern is that countries dismantle their trade
restrictions as they grow richer." This finding
explains why today's rich countries, with few
exceptions, embarked on modern economic growth
behind protective barriers but now display low
trade barriers.
(*) Walden Bello is executive director of Focus on
the Global South, a research, analysis and policy
programme of Chulalongkorn University's Social
Research Institute. He is also a professor of
sociology and public administration at the
University of the Philippines.
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