Alphabet Soup: MAI, TEP, and MRA

by Karen Talbot

CovertAction Quarterly, Fall / Winter 1999

It is highly likely that the economic globalization onslaught will be propelled forward exponentially at the meeting of the World Trade Organization (WTO) in Seattle at the end of November. Europe, the U.S., and the WTO are devising agreements that will remove the final obstacles to the free play of -market forces and require countries to submit to the unfettered expansion of the multinationals. Learning from the failure of the Multilateral Agreement on Investment (MAI), big business and technocrats are trying to force through a decision before the end of l999," according to Christian de Brie in Le Monde Diplomatique. The MAI had been "stopped" in the OECD. Again, as with the MAI, secret talks have been taking place-this time by the Transatlantic Economic Partnership (TEP) and the Millennium Round of the WTO. The first of these meetings, which opened on September 16, 1998, dealt with "the favorite project of the British and Americans-seeing the European Union dissolved in a free trade area with the United States," says de Brie. He points out:

"On the pretext of removing "technical barriers to trade," which include health, social and environmental protection regulations, the ultimate aim is to "reach a general commitment to unconditional access to the market in all sectors and for all methods of supply" of products and services, including health, education, and public contracts....

[T]alks proceed behind closed doors, using ... tactics to avoid alerting public opinion, so everything can be sewn up by December 1999. Industrial goods, services, public contracts, intellectual property, etc.-in a dozen fields, slice by slice, "mutual recognition agreements (MRAs)" ... seek to reduce standards and regulations to the lowest common denominator. The outcome is that the safeguards that Europe has built up, in food, the environment, and health in particular are being dismantled.

Once agreement has been reached, governments will be obliged to abolish any laws that conflict with the MRAs.... [T]he TEP follows the same aims as the MAI-to hand over all human activities to capital, without let or hindrance, thereby stripping the EU, member governments, and local authorities of their ability to pursue their own policies....

But the document ... has another aim: to establish a US-EU condominium capable of imposing its will on the rest of the world, and in particular the countries of the South in the [WTO] talks....

[T]here seems to be nothing to prevent the transnational corporations taking possession of the planet and subjecting humanity to the dictatorship of capital....

In order to crush any thought of organized resistance to ( the supporters of the new world order, tremendous police and military forces are being used to establish a doctrine of repression...."

This assault on sovereignty and the democratic rights of the people will also impact people in the U.S. itself. The provisions of the MAI are finding their way into many agreements, such as the "African Growth and Opportunity Act"- the NAFTA for Africa bill recently passed by Congress. Even NAFTA, though purporting to deal only with trade issues, has a section on investments which is now being evoked in a suit by Canada, on behalf of a corporation challenging recently adopted California environmental legislation banning the gasoline additive MTBE. If the suit prevails, California will have to abolish the law or pay large penalties.

The original draft of the MAI and its clones are written to have a dual effect: threatening social programs, while protecting and enhancing military spending and arms trade. The General Agreement on Tariffs and Trade (GATT) also exempts military spending from its proscriptions against government subsidies. This gives U.S. corporations a great advantage over other countries because of the trillions already being lavished on the Pentagon. In fact, the high-tech industry got its start and continues to benefit from the research conducted by the military with taxpayer dollars.

The purpose of MAI-type agreements is to remove virtually all barriers to investment by corporations. Foreign investors would be required to be treated the same as domestic investors. Governments would be denied much of their power to intervene in the economy to promote social goals. Thus national sovereignty and the democratic rights of the people would also be usurped.

So while the MAI-and now its clones-would threaten nearly every public sector of national economies such as health care, education, and culture, government spending for the military weapons development and production, and direct support for weapons corporations are excluded from the liberalizing demands of such an agreement.

NAFTA mechanisms, as well as the WTO, IMF, and World Bank are totally / undemocratic, with no access by the people. They are run by the nations with the ( greatest wealth, the U.S. in the first place-with the corporations and banks pulling the strings.

Even the United Nations is increasingly coming under the sway of the TNCs and being privatized. This development is indicated in a joint statement issued by U.N. Secretary General Kofi Annan and the President of the International Chamber of Commerce (ICC), Adnan Kassar, entitled: "Partnership between United Nations and Private Sector Would Do Much to Spread Benefits of Globalization." The statement said, among other things: "The aim should be to enable the benefits of globalization increasingly to spread to all people by building an effective framework of multilateral rules for a world economy that is being transformed by the globalization of markets."

So it is clear that the new world order of the free market promises further erosion of the U.N., more wars, destruction of sovereignty, elimination of social programs for the people, increasing poverty and joblessness, and the demise of democracy.

Already, United Nations bodies dealing with economic issues have been emasculated or eliminated through U.S.-sponsored "reforms." Their functions are being fully usurped by the international financial institutions and the WTO.

Multilateral Agreement on Investments