A Concise History
Znet / Z mag.org, 12/28/04
Economic globalization creates wealth,
but only for the elite who benefits from the surge of consolidations,
mergers, global scale technology and financial activity (gambling
in currency speculation) in this "casino economy". The
rising tide of free trade and (economic) globalization is supposed
to "lift all boats", and finally end poverty. But in
the half century since this big tide began, the world has more
poverty than ever before, and the situation is getting even worse.
UNICEF estimates that every hour 1000 children die from easily
preventable disease, and almost twice as many women die or suffer
from serious disability in pregnancy or childbirth because of
the lack of simple remedies and care. In his Final Report to the
UN Commission on Human Rights, Special Rapporteur Leandro Despouy
cites the World Health Organization's characterization of extreme
poverty as the world's most ruthless killer and the greatest cause
of suffering on earth:
"No other disease compares to the
devastation of hunger which has caused more deaths in the past
two years than were killed in the two World Wars together. To
make the end to this tragedy, only 10 percent of U.S. military
spending would be enough."
Similarly, the UN Food and Agriculture
Organization (FAO) reports that the number of chronically hungry
people in the world has been increasing steadily since the early
1990s. In a world in which a few enjoy unimaginable wealth, two
hundred million children die each year from hunger-related disease.
A hundred million children are living or working on the streets.
Just imagine that eight hundred million people go to bed hungry
each night. But this human tragedy is not confined to poor countries
only. Even in a country as wealthy as the United States, about
10 percent of U.S. households, accounting for 31 million people,
do not have access to enough food to meet their basic needs. So
31 million people experience outright hunger, while the richest
5 percent of the U.S. population own 81.9 percent of corporate
stock, and controls 57.4 percent of the net worth of all people
in the United States.[ii] To put the hint from above in a different
way, it means that by the time you finish reading this page 100
people will have died from easily preventable and hunger related
disease. Half of them will be children aged under five. So much
for rising tide that lifts all boats... It lifts only yachts...
Of course the World Trade Organization
(WTO) is not the only cause for the tragedy described above, but
as many economists note, it is an important part of the Unholy
Trio (WTO, World Bank, International Monetary Fund), which is
the main drive behind economic globalization. But when we cut
through the corporate propaganda about the benefits of globalization
and really look at the track record of the WTO what we find is
a slow motion coup d'etat, a low intensity war waged to redefine
free society - democracy and its non-commercial health, safety
and other protections, for example - as subordinate to the dictates
of big business.
Approval of these "free-trade"
agreements has institutionalized a global economic and political
structure that makes every government increasingly hostage to
an unaccountable system of transnational governance designed to
increase corporate profit, often with complete disregard for social
and ecological consequences. Under this new system, many decisions
affecting people's daily lives are being shifted away from our
local and national governments and being placed increasingly in
the hands of unelected trade bureaucrats sitting behind closed
doors in Geneva, Switzerland. These bureaucrats, for example,
are now empowered to dictate whether people in Slovenia can pursue
certain actions to prevent the destruction of their forests or
determine if carcinogenic pesticides can be banned from their
food. At stake is the very basis of democracy and accountable
decision-making. The establishment of the WTO therefore marks
landmark formalization and strengthening of their power.
There were many who argued that the fall
of Berlin wall and collapse of Soviet Block would mark the beginning
of a new era, in which a full blow of capitalism, allowed freely
to roam across the globe, would certainly mark "the end of
history". Ten years later, we can claim with certainty that
they were wrong. In the first place Francis Fukuyama, although
he succeeded to sell quite a lot of his incorrect "Bibles"
of neoliberalism, and also former British Prime minister Margaret
Thatcher, who claimed a few years earlier that "there is
no alternative" to the rise of neoliberalism (a phrase so
common that was often appreviated to TINA).
But on January 1, 1994, the indigenous
people of Chiapas came from the deepest reaches of the jungle,
from the deepest reaches of abandonment, with rifles high, crying
out that ordinary people also have the right to live. The Zapatistas
chose to start their war against neoliberalism and/or economic
globalization on the day the North American Free Trade Agreement
(NAFTA) took affect. Dressed in handmade blankets, rough sandals,
woolen ski-masks to hide their faces, and many of them armed only
with wooden facsimiles of guns, they took over Plaza de Armas
in San Cristobal de las Casas and five Chiapas towns. Subcomandante
Marcos, the spokesperson of the Zapatista Army of National Liberation
(EZLN), once explained: "Neoliberalism is not in a crisis,
neoliberalism is a crisis!"
According to Marcos, nowadays the planet
is a battlefield of the Fourth World War (the Third was so-called
Cold war). The aim of the war is a conquest of the entire world
through the market. Today's arms are financial, though millions
of people are maimed or killed every moment. Those waging war
are aiming to convert the whole world into one big business, with
WTO, World Bank, IMF, OECD, and the President of the United States
as the board of directors. Globalization is thus merely the totalitarian
extension of the market logic to all aspects of life. Meanwhile,
nine-tenths of world's population lives with "the jagged
pieces that do not fit". Marcos writes:
"What we have here today is a puzzle.
When we attempt to put these pieces together in order to arrive
at an understanding of today's world, we find that a lot of pieces
are missing. Still, we can start with seven of them, in hope that
this conflict won't end with the destruction of humanity. Seven
pieces to draw, color in, cut out, and put together with others,
in order to solve this global puzzle.
The first piece has the shape of a dollar
sign and is green. This piece consists of the new concentration
of global wealth in fewer and fewer hands, and the unprecedented
extension of hopeless poverty.
The second piece is triangular (depicts
the pyramid of worldwide exploitation), and consists of a lie.
The new world order claims to rationalize and modernize production
and human endeavor. In reality, it is a return to the barbarism
of the beginnings of the industrial revolution with important
difference, that the barbarism is unchecked by any opposing ethical
consideration or principle.
The third piece is round like a vicious
circle, and consists of enforced migration. Those who have nothing
are forced to migrate to survive. Yet the new world order works
according to the market principle, that anybody who doesn't produce
and doesn't consume and has no money to put into a bank, is redundant.
So the emigrants, the jobless, the landless, the homeless, are
treated as the waste that should be eliminated.
The fourth piece is rectangular like
a mirror, and consists of an ongoing exchange between the commercial
banks and the world's modern soldier - financial globalization
is enforcing globalization of crime.
The fifth piece is more or less like
a pentagon, and consists of physical repression. The nation-states
under the new world order have lost their economic independence,
their political initiative, and their sovereignty. Nowadays, the
nation-states are just departments of the corporation known as
the world, and politicians only local managers. The new task of
nation-states is to manage what is allowed to them, to protect
the interests of the market and to control and police the redundant.
The sixth piece is in the shape of a
scribble, and consists of breakages. On the one hand the new world
order does away with frontiers and distances by telecommunication
(of exchanges), and deals by obligatory free-trade zones, and
by imposing everywhere law of the market.
The seventh piece has the shape of a
pocket, and consists of all various pockets of resistance against
new world order that are developing around the world. The many
pockets do not have a common political program per se. How could
they, existing as they do in broken puzzle, but exactly their
heterogeneity may be a promise."[iii]
As we can see, the seven pieces will
never fit together to make any sense, even as we try as hard as
we can. Marcos warns that this lack of sense, this absurdity,
is endemic to the new world order. When the political and business
elite met on the fifth WTO ministerial conference in Cancun, Mexico,
in September 2003, Subcomandante Marcos wrote to the international
civil society his famous communique The Death Train of the WTO.
It is worth quoting in length:
"Brothers and sisters of Mexico
and the world, who are gathered in Cancun in a mobilization against
neoliberalism, greetings from men, women, children and elderly
of the Zapatista National Liberation Army. It is an honor for
us that, amid your meetings, agreements and mobilizations, you
have found time and place to hear our words.
The world movement against the globalization
of death and destruction is experiencing one of its brightest
moments in Cancun today. Not far from where you are meeting, a
handful of slaves to money are negotiating the ways and means
of continuing crime of economic globalization. The difference
between them and all of us is not in the pockets of one or the
other, although their pockets overflow with money while ours overflow
with hope. No, the difference is not in the wallet, but in the
heart. We have in our hearts a future to build. They only have
the past which they want to repeat eternally. We have hope. They
have death. We have liberty. They want to enslave us.
This is not the first time, nor will
it be the last, that the people who think themselves the owners
of the planet have had to hide behind high walls and their pathetic
security forces in order to put their plans in place. As if at
war, the high command of the multinational army that wants to
conquer the world in the only way possible, that is to say, to
destroy it, meets behind a system of security that is as large
as their fear.
Before, the powerful met behind the backs
of the world to scheme their future wars and displacements. Today
they have to do it in front of thousands in Cancun and millions
around the world. This is what this is all about. It is war. A
war against humanity. The globalization of those who are above
us is nothing more than a global machine that feeds on blood and
defecates in dollars.
In complex equation that turns death
into money, there is a group of humans who command a very low
price in the global slaughterhouse - the indigenous, the young,
the women, the children, the elderly, the migrants, all those
who are different. That is to say, the immense majority of humanity.
This is a world war of the powerful who want to turn the planet
into a private club that reserves the right to refuse admission.
The exclusive luxury zone where they meet is a microcosm of their
project for the planet, a complex of hotels, restaurants, and
recreation zones protected by armies and police.
All of us are given the option of being
inside this zone, but only as servants. Or we can remain outside
of the world, outside life. But we have no reason to obey and
accept this choice between living as servants or dying. We can
built a new path, one where living means life with dignity and
freedom. To build this alternative is possible and necessary.
Brothers and sisters, there is dissent
over the project of economic globalization all over the world.
Those above, who globalize conformism, cynicism, stupidity, war,
destruction and death. And those below, who globalize rebellion,
hope, creativity, intelligence, imagination, life, memory and
the construction of a world that we can all fit in, a world with
democracy, liberty and justice. We hope the death train of the
World Trade Organization will be derailed in Cancun and everywhere
Indeed, they did. And as we will see,
that was the right thing to do.
FROM GATT TO THE WTO
The WTO has emerged as the third pillar
of the Bretton Woods system. A very healthy debate was launched
after World War Two about the need for global trade and investment
institution that could help generate full employment, protect
workers rights around the globe, and protect against what were
then referred to as "global cartels" - small groups
of corporations that gained too much power over a sector. These
broad-based were enshrined in a Havana charter that proposed the
formation of an International Trade Organization (ITO). It was
rejected by the U.S. Senate on the grounds that its broad mandate
would compromise U.S. sovereignty, only one element of the ITO,
General Agreement on Tariffs and Trade (GATT), was created instead,
with more narrow goal of reducing tariffs in goods and services
and setting a handful of broad trade principles. Its aim was to
reduce national trade barriers and to stop the competitive trade
policies that had hobbled the global economy prior to World War
World trade grew dramatically following
the World War Two, under the guidance of the GATT. Seven rounds
of tariff reductions were negotiated under the GATT treaty - the
final "Uruguay Round" began in 1986. The WTO, established
in January 1, 1995, is the outcome of the Uruguay Round of trade
talks, held from 1986 to 1993 under the auspices of the General
Agreement on Tariffs and Trade (GATT). "The Final Act of
Embodying the Results of the Uruguay Round of Multilateral Trade
Negotiations" was enacted in 1994, in Marrakech. It paved
the way for the new WTO and gave that body the ability to overrule
or undermine international conventions, acts, treaties, and agreements.[v]
Like the GATT, the WTO is not a United Nations agency.
At the insistence of the United States
the Uruguay Round talks included agriculture and services for
the first time. With 147 members (as in April 2004) the WTO enforces
the 1993 Uruguay Round agreements: the Agreement on Agriculture
(AoA), the General Agreement on Trade in Services (GATS), the
agreements on Trade-Related Intellectual Property Rights (TRIPs)
and Trade-Related Investment Measures (TRIMs).
The WTO, unlike GATT, has the official
status of an international organization rather than loosely-structured
treaty. The WTO presents itself as a forum for members to negotiate
over trade liberalization. In practice the organization is a trade
liberalization juggernaut which has been ceded enormous power
by its members and, on some issues, has assumed the role of global
economic governance. The WTO furthers the cause of liberalization,
to the chief benefit of those who stand to gain the most from
liberalization - in practice the Transnational Corporations (TNCs).
The WTO is an organization "that mediates trade disputes,
seeks to reduce barriers between countries and embodies the agreements,"
WTO director-general Mike Moore told in Seattle in 1999 at the
time of the WTO's third ministerial. But the WTO is far more.
Unlike past trade pacts, the WTO and
its underlying agreements move far beyond traditional commercial
matters such as tariffs, import quotas or requirements that foreign
and domestic goods be treated equally. The WTO's provisions set
limits on the strength of countries' food safety laws and the
comprehensiveness of product labeling policies. They forbid countries
from banning products made with child labor. They can even regulate
expenditure of local tax dollar: for instance, prohibiting environmental
or human rights considerations in government purchasing decisions.
WHOSE TRADE ORGANIZATION?
The WTO has rapidly accumulated a sordid
record. Binding decisions from its enforcement tribunals have
undermined consumer and environmental protections around the world.
TNCs have used the threat of WTO action to roll back or block
countless rules designed to benefit workers, consumers and the
environment, and to promote human rights and development in the
world's poorest countries. But all this has been predicted long
before the WTO came into formal effect. From the outset GATT was
seen as a "rich man's club" dominated by Western industrial
While initially limited to the trade
expansion mandate, GATT evolved into institution that promoted
corporate rights over human rights and other social and environmental
priorities. In 1980s, economists and politicians, powered by the
so-called "Reagan Revolution" and the Thatcher and Kohl
ascendancies in Europe, began planning a new but dramatically
different GATT negotiating round. Their goal was to expand the
GATT disciplines to bind signatory governments to a set of multilateral
policies regarding the service, government procurement, and investment
sectors; to establish global limits on government regulation of
environmental, food safety, and product standards; to establish
new protections for corporate intellectual property rights granted
in rich countries; and to have this broad panoply of one-size-fits-all
rules strongly enforced over every level of government in every
When the Uruguay Round was being negotiated,
environmental, labor and consumer groups thus rightly warned that
the GATT system, which had existed for decades, was being dramatically
recast and expanded in a way that would subjugate main public
interest needs to corporate interests. Proponents of the Uruguay
Round and the WTO dismissed these concerns as ill-informed doomsday
prophesies. They promised that the WTO would pose no threat to
domestic sovereignty or democratic, accountable policy-making.
They promised enormous economic gains worldwide if the Uruguay
Round were implemented: the U.S. trade deficit would decrease
by $60 billion in ten years[vi] , Latin American countries would
boom, and Asian grow would keep pace.
Now, nearly nine years later, it is clear
that the promised economic gains have not been realized. Not only
has the WTO failed to live up to its promises, but it is wreaking
continuing damage to health, human rights, safety and environmental
safeguard, and even local/indigenous cultures (ergo cultural diversity).[vii]
TNCs are powerful (rich) enough to exert
considerable influence on the WTO. While it is corporations rather
than countries that trade[viii] , the WTO is made up of countries.
It is no surprise then that its decisions are usually in the line
with corporate expectations. Government ministers and their officials
conduct business at the WTO meetings under the gaze of representatives
from major corporations, who may even be a part of the official
delegation. It is evident that the WTO should be either substantially
reformed or replaced. The following short list suggests that (as
it is now) the WTO differs from any kind of government democratic
societies are familiar with:[ix]
- It operates in secret. The judges that
sit on the WTO panels are appointed. They meet behind closed doors.
They hear no outside witnesses. Their proceedings are not made
- WTO judges are not chosen because of
their expertise in the subject they are ruling on, but for adherence
to the tenets of free trade.
- Only governments can bring a case to
the trade panels. Citizen organizations, individuals, and local
- The WTO allows nations to enact laws
that are weaker than global standards but not stronger.
- The WTO offers no democratic process
for change. It can be amended, but only from within.
- In theory the WTO is a "one-member
country, one-vote" democracy, but in practice there has never
been a vote in its nine years' existence. Maybe because developing-country
members could vote to change the rules of game?
- The WTO is fundamentally undemocratic:
the policies of the WTO impact all aspects of society and the
planet, but it is not a democratic, transparent institution. The
WTO rules are written by and for corporations with inside access
to the negotiations. For example, the US Trade Representative
gets heavy input for negotiations from 17 "Industry Sector
Advisory Committees". Citizen input by consumer, environmental,
human rights and labor organizations is consistently ignored.
Even simple requests for information are denied, and the proceedings
are held in secret. Who elected this secret global government?
- The WTO will not make us safer: the
WTO would like you to believe that creating a world of "free
trade" will promote global understanding and peace. On the
contrary, the domination of international trade by rich countries
for the benefit of their individual interests fuels anger and
resentment that make us less safe. To build real global security,
we need international agreements that respect people's rights
to democracy and trade systems that promote global justice.
- The WTO tramples labor and human rights:
WTO rules put the "rights" of corporations to profit
over human and labor rights. The WTO encourages a 'race to the
bottom' in wages by pitting workers against each other rather
than promoting internationally recognized labor standards. The
WTO has ruled that it is illegal for a government to ban a product
based on the way it is produced, such as with child labor. It
has also ruled that governments cannot take into account "non
commercial values" such as human rights, or the behavior
of companies that do business with vicious dictatorships such
as Burma when making purchasing decisions.
- The WTO would privatize essential services:
the WTO is seeking to privatize essential public services such
as education, health care, energy and water. Privatization means
the selling off of public assets - such as radio airwaves or schools
- to private (usually foreign) corporations, to run for profit
rather than the public good. The WTO's General Agreement on Trade
in Services, or GATS, includes a list of about 160 threatened
services including elder and child care, sewage, garbage, park
maintenance, telecommunications, construction, banking, insurance,
transportation, shipping, postal services, and tourism. In some
countries, privatization is already occurring. Those least able
to pay for vital services - working class communities and communities
of color - are the ones who suffer the most.
- The WTO is destroying the environment:
the WTO is being used by corporations to dismantle hard-won local
and national environmental protections, which are attacked as
"barriers to trade." The very first WTO panel ruled
that a provision of the US Clean Air Act, requiring both domestic
and foreign producers alike to produce cleaner gasoline, was illegal.
The WTO declared illegal a provision of the Endangered Species
Act that requires shrimp sold in the US to be caught with an inexpensive
device allowing endangered sea turtles to escape. The WTO is attempting
to deregulate industries including logging, fishing, water utilities,
and energy distribution, which will lead to further exploitation
of these natural resources.
- The WTO is killing people: the WTO's
fierce defense of "Trade Related Intellectual Property"
rights (TRIPs) - patents, copyrights and trademarks - comes at
the expense of health and human lives. The WTO has protected for
pharmaceutical companies' "right to profit" against
governments seeking to protect their people's health by providing
lifesaving medicines in countries in areas like sub-Saharan Africa,
where thousands die every day from HIV/AIDS. Developing countries
won an important victory in 2001 when they affirmed the right
to produce generic drugs (or import them if they lacked production
capacity), so that they could provide essential lifesaving medicines
to their populations less expensively. Unfortunately, in September
2003, many new conditions were agreed to that will make it more
difficult for countries to produce those drugs. Once again, the
WTO demonstrates that it favors corporate profit over saving human
- The WTO is increasing inequality: free
trade is not working for the majority of the world. During the
most recent period of rapid growth in global trade and investment
(1960 to 1998) inequality worsened both internationally and within
countries. The UN Development Program reports that the richest
20 percent of the world's population consume 86 percent of the
world's resources while the poorest 80 percent consume just 14
percent. WTO rules have hastened these trends by opening up countries
to foreign investment and thereby making it easier for production
to go where the labor is cheapest and most easily exploited and
environmental costs are low.
- The WTO is increasing hunger: farmers
produce enough food in the world to feed everyone - yet because
of corporate control of food distribution, as many as 800 million
people worldwide suffer from chronic malnutrition. According to
the Universal Declaration of Human Rights, food is a human right.
In developing countries, as many as four out of every five people
make their living from the land. But the leading principle in
the WTO's Agreement on Agriculture is that market forces should
control agricultural policies-rather than a national commitment
to guarantee food security and maintain decent family farmer incomes.
WTO policies have allowed dumping of heavily subsidized industrially
produced food into poor countries, undermining local production
and increasing hunger.
- The WTO hurts poor, small countries
in favor of rich powerful nations: the WTO supposedly operates
on a consensus basis, with equal decision-making power for all.
In reality, many important decisions get made in a process whereby
poor countries' negotiators are not even invited to closed door
meetings - and then "agreements" are announced that
poor countries didn't even know were being discussed. Many countries
do not even have enough trade personnel to participate in all
the negotiations or to even have a permanent representative at
the WTO. This severely disadvantages poor countries from representing
their interests. Likewise, many countries are too poor to defend
themselves from WTO challenges from the rich countries, and change
their laws rather than pay for their own defense.
- The WTO undermines local level decision-making
and national sovereignty: the WTO's "most favored nation"
provision requires all WTO member countries to treat each other
equally and to treat all corporations from these countries equally
regardless of their track record. Local policies aimed at rewarding
companies who hire local residents, use domestic materials, or
adopt environmentally sound practices are essentially illegal
under the WTO. Developing countries are prohibited from creating
local laws that developed countries once pursued, such as protecting
new, domestic industries until they can be internationally competitive.
California Governor Gray Davis vetoed a "Buy California"
bill that would have granted a small preference to local businesses
because it was WTO-illegal. Conforming with the WTO required entire
sections of US laws to be rewritten. Many countries are even changing
their laws and constitutions in anticipation of potential future
WTO rulings and negotiations.
BUMPY ROAD TO CANCUN
In late November 1999, the 134 countries
that were WTO Members met in Seattle, Washington, for a Third
Ministerial Summit to determine the future plan of the WTO. Most
corporate interests sought a major expansion of WTO rules to cover
education and health services and also to establish new rights
for currency speculators and foreign investors (bringing into
the WTO the Multilateral Agreement on Investment - MAI). [x] The
main goal of the Seattle Ministerial was to obtain an agreement
to: launch new negotiations to expand the scope of the WTO to
include new service sector, such as health and education; expand
the rules concerning government procurement to all WTO members,
first by requiring all WTO Member countries to publicly list all
of their procurement activity and to agree to future negotiations
limiting the ability of governments to take non-commercial considerations;
sign a "Global Free Logging" pact that could increase
deforestation by 4% per year; launch new negotiations on the WTO
protections for biotechnology products (such as genetically modified
organisms); further deregulate agricultural trade.
But a global coalition of citizen groups
(Seattle Coalition) - consumer, religious, environmental, labor,
family farm etc. - under the slogan "No New Round, Turnaround"
deadlocked WTO negotiators and brought that powerful agency's
momentum to a standstill.[xi] It is difficult to exaggerate the
significance of this protest known as the Battle of Seattle which
represents the first manifestation of global resistance against
neoliberalism and corporate greed.
After efforts to launch a new round of
trade negotiations at Seattle Ministerial were disrupted, the
WTO was once again forced to expose its undemocratic nature by
moving its 2001 Ministerial Meeting to Qatar, a remote monarchy
where public protest are ruthlessly suppressed.
The protests that contributed to a breakdown
of the WTO meeting in Seattle emboldened some governments of Southern
countries to be more forthright in their challenge to WTO procedures
and proposals harmful to their national interests. Most poor countries
have never enjoyed much benefit from economic globalization. After
three decades of strong doses of IMF and World Bank and less than
a decade of WTO policies, many have realized that (economic) globalization
is a false promise, that the policies are not designed to benefit
them but to benefit rich industrial countries and their TNCs.
For this reason, many of the poor nations of the world (notably
from the Caribbean and Asia) - held firmly together in the opposition
to the WTO in Seattle and only reluctantly agreed to further trade
talks in Doha.
At November 2001 WTO Ministerial Meeting
in Doha, the WTO made once again explicit its intention to bring
into force the goals of the Seattle Ministerial (see above), to
bring into its millieu of work the Multilateral Agreement on Investment
(MAI), and to codify its superiority to Multilateral Environment
Agreements (MEA) and thus wiping out generations of effort These
attempts were strongly resisted by most of the developing countries
(including regional groupings), which argued that (a) they were
not yet ready to enter negotiations or consider agreements on
these issues; (b) they did not adequately understand implications
of the proposed issues; and (c) from the limited understanding
they did have, they were very concerned that new agreements in
these areas would add to their already heavy obligations and further
restrict their development prospects.
The Doha meeting ended with confusing
language on both the calls for fairer trade agenda of the developing
nations and the desire for new issues by the developed countries.
But one thing was sure - the "death train" of the WTO
will derail sooner or later...
DERAILMENT IN CANCUN
At the last meeting in Doha, the developing
countries insisted that if another round of trade negotiations
was to be initiated, their concerns had to be heard - and they
achieved some notable concessions. With China's joining the WTO,
the developing countries have had a powerful voice on their side,
though the interests of China and those of many of the other developing
countries do not fully coincide. The WTO held its fifth Ministerial
Meeting in Cancun, Mexico, in September 2003. On the agenda were
a range of issues agreed upon in Doha. On the other hand, the
EU and the U.S. had continued to push for an expansion of the
WTO's powers to include new issues, insisting that these issues
get dealt with first before the development issues that should
have been at the top of the agenda. From the start of the conference,
rich countries disowned big parts of the Doha agenda. The European
Union, for instance, denied it had ever promised to get rid of
export subsidies. Led by India, many poor countries denied that
they ever signed up for talks on new rules. Other poor countries
spent more time moaning about their grievances over earlier trade
rounds than they did in negotiating the new one. Several rich
countries too showed little interest in compromise. Japan, for
instance, seemed content simply to say no to any cuts in rice
The immediate reason for the collapse
of talks was the failure to resolve serious differences between
the rich and poor nations. Many developing countries, including
the African, Caribbean and Pacific (ACP) group, the African Union,
G-21, the Least Developed Countries (LDCs) and Asian countries
said they would like the conference not to launch negotiations
on the Singapore issues (The issues emerging from the Singapore
conference in December 1996 relate to investment, competition,
government procurement and trade facilitation.) The developing
countries stood firm even after the EU agreed to drop two of these
issues and retain on the agenda trade facilitation, considered
key to small and medium enterprises, and transparency in public
procurement. Roberto Bissio, director of the Uruguay-based Social
Watch said this was not surprising. The Doha Development Agenda
agreed two years ago in the capital of Qatar clearly stated that
the Singapore issues would be discussed only after "an explicit
consensus" had been reached. But that had clearly not happened.
Led by Brazil, China and India, this
so-called G21 became a powerful voice. It represented half the
world's population and two-thirds of its farmers. It was well
organized and professional. Although it spanned diverse interests
- India, for instance, is terrified of lowering tariffs on farm
goods, while Brazil, a huge and competitive exporter, wants free
trade as fast as possible - the G21 stood together and hammered
one message home: rich countries, as the most profligate agricultural
subsidizers, should make bigger efforts to cut subsidies and free
farm trade. The level of support given to farmers by the rich
countries of the OECD has remained more or less unchanged (at
over $300 billion) for the past 15 years.
While the fight between Europe, America
and the G21 received most attention, another alliance of poor
countries, most of them from Africa, was also worried about agriculture,
but for different reasons. They feared that freeing farm trade
would mean losing their special preferences. (Europe's former
colonies, for instance, get special access to the EU's markets
for their bananas.) And many, particularly a small group of countries
in West Africa, worried most of all about cotton. Prodded and
encouraged by non-governmental organizations (NGOs), especially
Oxfam, a group of four West African countries - Benin, Burkina
Faso, Chad and Mali - managed to get cotton included as an explicit
item on the Cancun agenda. Their grievances were simple, and justified.
West African cotton farmers are being crushed by rich-country
subsidies, particularly the $3 billion-plus a year that America
lavishes on its 25,000 cotton farmers, helping to make it the
world's biggest exporter, depressing prices and wrecking the global
market. The West African four wanted a speedy end to these subsidies
and compensation for the damage that they had caused. Though small
fry compared with the overall size of farm subsidies, the cotton
issue (like an earlier struggle over poor-country access to cheap
drugs) came to be seen as the test of whether the Doha round was
indeed focused on the poor.
Before Cancun, the U.S./EU had reached
an agreement on agriculture which in effect was forcing the South
to further dismantle trade barriers, while refusing to reduce
export subsidies to the US and European agribusiness. A group
of 21 developing countries had made a counter proposal, insisting
on removal of export subsidies which are killing Third World farmers
before further reduction of tariffs. There was a deadlock in agriculture
over the two texts. When the WTO issued a draft declaration on
13th, it failed to reflect any of the concerns of the South. What
is worse, the demand of African cotton producing countries to
protect them from the distortions of U.S. dumping was trivialized
to a paragraph suggesting that Africans should abandon cotton
production. U.S. subsidies to cotton production and exports have
increased to $4 billion after the new U.S. Farm Act.
In 2001, the cost of production of cotton
in US was $0.9313/bushel, while the export price was $0.3968/bushel,
a dumping of 57 per cent. This has increased from 17 per cent
in 1995. WTO has thus encouraged dumping while preventing poor
countries to protect themselves from the devastating impacts of
dumping. The U.S. farm bill has increased subsidies by $82 billion.
The U.S. farm act of 2002 allows the U.S. Government to pay cotton
farmers the difference between the world market price, $1.23 per
kilo, and a fantasy ideal price of $1.57 per kilo. US cotton farmers
receive $3.9 billion, most of it going to the giant corporate
farmers. With these subsidies, the US has doubled cotton exports
and destroyed the livelihoods and incomes of 250 million African
But the draft text that emerged halfway
through the Cancun meeting was a huge disappointment. The promises
on cotton were vague, pledging a WTO review of the textiles sector,
but with no mention of eliminating subsidies or of compensation.
Worse, it suggested that the West African countries should be
encouraged to diversify out of cotton altogether. This hard-line
stance had American fingerprints all over it. Political realities
in Congress (the chairman of the Senate agriculture committee
is a close ally of the cotton farmers) made American negotiators
fiercely defensive of their outrageous subsidies.
For the Africans, the vague text was
a big blow. As a result, the poorest countries dug in their heels
when it came to the other big controversial area: that of extending
trade negotiations into the four new Singapore issues. And not
just that. African countries led the walkout by WTO members who
were outraged at the refusal of WTO and rich countries to remove
distortions and unfairness in trade and the attempt by the rich
to impose new disciplines on investment competition, government
procurement and trade facilitation. What the U.S./EU wanted in
Cancun was to continue the right to dump, continue unfair trade
by supporting their agribusiness interests to take over world
markets through WTO's market access rules. This is what the WTO
rules were designed to do.
Many perceive Cancun as a victory of
democracy over dictatorship, of fairness over injustice, of the
South over the North, of the poor over the rich, of people over
profits, and of life over death.[xiii] And some of us rightly
as a derailment of the death train of the WTO...
Today's conquistadores, corporate managers,
generally measure progress by indicators of their own financial
wealth, such as rising stock prices and indicators of the total
output of goods and services. With few exceptions of occasional
cyclical setbacks in some parts of the world (Latin America) and
declining per capita incomes in the poorest African countries,
these indicators generally perform well, confirming elite's premise
that their program is enriching the world. In contrast, ordinary
citizens measure progress by indicators of their well being, with
particular concern for the lives of those most in need. As Robert
Kennedy once pointed out:
"Gross National Product measures
neither the health of our children, the quality of their education,
nor the joy of their play. It measures neither the beauty of our
poetry, nor the strength of our marriages. It is indifferent to
the decency of our factories and the safety of our streets alike.
It measures neither our compassion nor our devotion to our country.
It measures everything in short, except that which makes life
worth living. It can tell us everything about our country, except
those things that make us proud to be part of it."
But these "people's" indicators
are deteriorating at a frightening pace, suggesting that in terms
of what really matters, things are not so bright after all. In
fact, world is rapidly growing poorer. Also due "democratic"
(racist would be a proper term) policies of the WTO. In its nearly
ten years of existence, the WTO has had (wide-raging) devastating
impact on jobs, wages and livelihoods and on international and
domestic environmental, health and food safety protections, as
well as on economic development, human rights and global trade
and investment. Therefore we can understand why these impacts
have not been systematically studied (by our democratic governments)
nor have they been well covered in the mainstream media. As a
consequence, most people around the globe lack an awareness that
their lives, livelihoods, food, environment, and their futures,
are being shaped by this powerful non-democratic and even anti-democratic
No doubt, that there are other models
that would result in a more equitable, safe, ecologically sound
and democratically society. The question is how the majority of
people worldwide who are being ill-served by this neoliberal system
can best inform and organize ourselves to make the change. Eduardo
Galeano, one of Latin America's foremost writers, told at the
first World Social Forum, held in Porto Alegre, Brazil, in 2001:
"The system presents itself as eternal; the power system
tells us that tomorrow is another word for today." We shouldn't
forget how often in the past centuries people have been astonished
by sudden crumbling of institutions, extraordinary changes of
people's thoughts, unexpected eruptions of rebellions against
tyrannies, quick collapse of systems of power that seemed invincible.
We shouldn't forget how often in the past have those in power,
who confidently said "never!" to possibility of change,
lived embarrassed by those words.
"No building is too tall for even
the smallest dog to lift its leg on..."
World Trade Organization (WTO)