10 reasons why the world trade system is bad for people and the
planet:
- The principles on which the trade system is based are fundamentally
flawed: The trade system pursues growth at all costs, through trade
and investment liberalization, and sees economic growth and
increasing consumption as ends in themselves. Key principles of free
trade, such as comparative advantage and export-led development, have
been discredited. The trade system ignores the fact that increasing
consumption is depleting natural capital (the environment) on which
the global economy is based. Increased trade also means more
transport, leading to a loss of natural habitats and biodiversity and
negative impacts on local communities. The trade system pays no heed
to equity and distribution and does little to promote development and
environmental protection.
- The trade system is increasing economic instability: The deregulation
of financial markets and the revolution in information and
communication technology has stimulated massive growth in short-term
capital flows, undermining countries' economies during economic
crises and increasing the number of people in poverty. Trade and
investment in least developed countries - particularly in Africa -
has been concentrated on primary commodities. Because of fluctuating
commodity prices in global markets this leads to increased economic
insecurity.
- The trade system is increasing inequality between the 'haves' and
'have-nots': The world trade system has increased the wealth of a
narrow band of society. The winners have been both the developed
countries and the wealthiest people, whilst poor countries and poor
people have been increasingly marginalized. The impact of trade
liberalization has hit subsistence farmers particularly hard. Trade
liberalization does not benefit the majority of the world's
population.
- The trade system does not respect the environment: Trade and
environmental policies have come into conflict at both the national
and international levels. Trade policies are almost always given
priority and environmental laws are frequently undermined as a
result. The powerful influence of trade concerns has also permeated
important climate change negotiations and blocked negotiations on a
Biosafety Protocol to regulate the use of and trade in genetically
modified organisms under the Biodiversity Convention.
- The trade system is increasing inequality between the 'knows' and
'know-nots': Knowledge - particularly information, communications and
biotechnology - is proving to be one of the key assets of a 'new'
economy. This has marginalized the 'know-nots' who have been kept out
of the knowledge sector and excluded those unable to share in the
knowledge revolution due to difficulties relating to cost, language
and literacy. The trade system protects the intellectual property of
knowledge-rich companies rather than diffusing knowledge and
transferring technology.
- The trade system is increasing employment insecurity: The expansion
of trade and the growth of incomes in OECD countries has not
increased employment in developed countries. The globalization of the
employment market and the mobility of companies and capital has also
increased instances of firms moving to take advantage of lower wages
and weaker labour laws. Threats to relocate also allow companies to
force reductions in environmental and social standards around the
world. Mergers, acquisitions and corporate restructuring are also
increasing employment insecurity.
- The trade system is bad for your health and safety: Companies are
moving or expanding operations in developing counties where work
force health and safety regulations are lower. Occupational disease,
injury and death have taken a particularly heavy toll in developing
countries due to globalization. Health and safety standards in
industrialized countries have been successfully challenged through
the WTO. Increased trade is also responsible for increased air
pollution.
- The trade system pits the weak against the strong: Small companies
are expected to compete in the global economy along with the likes of
Microsoft, Monsanto and Mitsubishi even though there is a massive
difference in both wealth and economies of scale. The influence of
transnational corporations in global trade policy is immense and
growing.
- The trade system has not advanced human development: Because of
conflicts between trade and other policies and because Gross Domestic
Product (GDP) calculations regard factors such as environmental
damage, ill health and crime as positive contributions to the
economy, the priority given by most governments to trade,
globalization and the pursuit of growth in GDP is contributing to
declining quality of life for many people. For example, over the past
25 years, there has been increasing job insecurity, growing global
crime, spread of diseases such as HIV, increasing civil unrest,
greater traffic and congestion and higher levels of climate changing
gases in the air.
- The trade system has not relieved poverty: As we reach the end of the
Millennium, more than a quarter of the developing world still live in
poverty and more than 100 million people in the developed world live
below the income poverty line. The trade system is exacerbating this
situation, particularly by marginalising the poorest and least
influential communities around the world.
10 reasons why the WTO - which administers the world trade system -
is also bad for people and the planet:
- The WTO is undemocratic: In spite of the one-country one-vote
structure of the WTO, powerful countries still wield enormous
influence, often determining negotiating agenda amongst themselves,
and putting pressure on smaller, poorly resourced countries to
conform. The concerns of rich communities, rich people and rich
companies all appear to be heard more readily by the WTO than those
of the poor.
- The WTO is untransparent and unaccountable: The WTO provides only
very limited access for parliamentarians and civil society at large.
Dispute settlements and the Appellate Body are conducted in closed
sessions, with no public access or external input. The WTO is exempt
from conventions allowing greater public access to information. In the past, there have been numerous reports of officials being unable
to access information about the activities of their own trade
negotiators.
- The WTO is increasing inequality and food insecurity: WTO Agreements
- such as the Agreement on Agriculture (AOA), TRIPs and the Sanitary
and Phytosanitary Measures - are increasing global inequality and
insecurity (particularly because of their impact on food production
and consumption) and favour rich countries and big business.
- WTO rules regard development and social issues as barriers to trade:
For example, the EU's preferential import regime for Caribbean banana
farmers - aimed at supporting small scale growers where costs are
high because of steep terrain, poor soils and climatic hazards - was
deemed incompatible with WTO rules. The long-standing Lome Convention
between the European Union and African, Pacific and Caribbean
countries is also likely to disappear in the near future, for exactly
the same reason.
- WTO rules regard environmental and health issues as barriers to
trade: WTO rules conflict with many national laws and practices
intended to promote sustainability and protect the environment. Most
WTO agreements are based on the premise of sound, scientific evidence
which severely limits the application of the precautionary principle.
WTO rules have already been used to rule in favor of free trade and
against various measures, eg hormone-treated beef and shrimps that
are caught using turtle-excluder devices.
- WTO rules regard labels and certification systems as potential
barriers to trade: The certification and labeling of environmental
and socially acceptable goods (such as timber or paper from
well-managed sources and fairly traded products) and products that
concern consumers (such as GM foods) could be undermined by WTO
rules.
- The WTO is eroding cultural diversity: The WTO TRIPs Agreement allows
companies to expropriate knowledge from local peoples in developing
countries who, in many cases, have been cultivators, researchers and
protectors of plants for thousands of years. The Agreement permits
(primarily Northern) transnational companies to claim traditional
plant varieties or plant uses as 'inventions' that must be respected
the world over. Culture could also be further eroded if issues
surrounding the entertainment business - for example, films,
broadcasting, music and publishing - are included in a new Round of
trade negotiations.
- The WTO could undermine multilateral environmental agreements:
Multilateral Environment Agreements that have trade components - such
as CITES, the Montreal Protocol and the Basel Convention on
Trans-boundary Movement of Hazardous Waste - could be challenged
under WTO rules.
- The 'all or nothing' approach of the WTO: The last Uruguay Round of
negotiations was dealt with as a 'single undertaking'. If the EU were
to have its way, the proposed Millennium Round would also be
negotiated as a 'single undertaking'. This means that many different
sectoral negotiations would be linked together and the results either
accepted or rejected in their entirety. This can put smaller
countries, many of whom do not have the capacity or the opportunity
to participate in the full range of negotiations at a severe
disadvantage. Thus many developing countries who were opposed to the
results of the agriculture and TRIPs negotiations in the Uruguay
Round were still forced to accept them or risk being isolated in the
global economy.
- Influence at the WTO can be 'bought': Subsequent to a $500,000
company donation to the US Democratic Party, the US Government lodged
a dispute in the WTO over the EU's banana import regime. Some of the
world's largest companies are paying hundreds of thousands of dollars
in the hope of gaining privileged access to key ministerial and other
negotiators at the Seattle Ministerial Conference through the Seattle
Host Organization. They expect to be able to attend receptions and
dinners for heads of states, ministers and delegates with
preferential seating.
Chris Keene,
Coordinator,
Anti-Globalisation Network,
90 The Parkway, Canvey Island,
Essex SS8 0AE, England
Tel: 01268 682820
Fax: 01268 514164