 |
Al-Ahram Weekly 20 - 26 January 2000 Issue No. 465 
|
||
Published in Cairo by AL-AHRAM established in 1875 |
| ||
|
Al-Ahram Weekly 20 - 26 January 2000 Issue No. 465
|
||
| Published in Cairo by AL-AHRAM established in 1875 |
| ||
Egypt Region International Economy Opinion Culture Features Profile Travel Living Sports People Time Out Chronicles Cartoons Letters Post Seattle, new battles
By Mahmoud Abdel-Fadil *"Man does not bathe in the same river twice" -- a reference to the continual flux of change that makes it impossible for history to repeat itself. And the philosopher's adage can be strikingly applied to the globalisation process pre- and post- Seattle and the backdrop to the third ministerial summit of the World Trade Organisation (WTO).
The WTO, as all are aware, is globalisation's strong arm in deregulating all aspects of international trade. Effecting barriers to all forms of goods and services trade, government contracts and purchases, intellectual property rights and a variety of investment arrangements, the WTO has become the dominant axis in the WTO-IMF-World Bank triangle entrusted with the management of the new global economic order.
From the outset it was clear that a number of items on the Seattle meeting's agenda would stir controversy, whether between the countries of the North and the South -- for whom the deregulation of trade will not bring the rosy future globalisation evangelists are touting -- or between the industrialised nations themselves. Because of the WTO's virtually exclusive focus on lifting trade barriers to the detriment of a host of other considerations, the Seattle meeting was accompanied by a spate of angry demonstrations in various quarters of the globe. On 27 November, two days before the meeting convened thousands of European farmers and agricultural tradesmen converged on La Place des Nations in Geneva to protest the deregulation of trade in agriculture, which was one of the main items on the Seattle agenda. They were supported by an elite corps of intellectuals and economists, among whom was the French Nobel Prize economist Maurice Elie. At the same time, more than 20,000 people marched through the streets of Paris carrying such banners with proclaiming sentiments such as "the world is not a commodity to be bartered among the strong".
Several months prior to the WTO ministerial summit, various groups of nations met to establish their positions on issues to be discussed in Seattle. In a meeting in Santo Domingo, 71 national leaders from Africa, the Caribbean and the Pacific resolved that the WTO should not encroach upon their trade privileges. As the poorest countries of the world, they said, they merited preferential trade status. The industrialised nations should lift all tariffs on the exports from these countries, and the privileges accorded to them under the Lomi Treaty with the EU should not be abolished on the grounds that they conflict with the rules established by the WTO.
Developing nations also want provisions in the agreements and resolutions of the Uruguay Round put into effect. Five years after the formation of the WTO, which was intended to oversee the implementation of such provisions, the pledges undertaken by the developed nations to support developing nations in technological development, the acquisition of technical expertise and information, and offset the detrimental effects of the deregulation of trade in agriculture are still no more than ink on paper.
The preamble to the agreement creating the WTO stated that developing nations still have special needs and that efforts should be focused on increasing their share in the growth of world trade. In spite of these stated intentions, quota restrictions on textiles and clothing exports continue to remain in place even as the preferential privileges that had been accorded these exports are being eroded. Developing countries' share in the growth rate of the international trade in textiles and clothing has yet to surpass 4.3 per cent -- the rate at which it stood five years ago -- while industrial countries' exports in this field have climbed at an average of nine per cent annually.
Seattle itself turned into a battlefield between demonstrators and the authorities of the host country. With around 100,000 demonstrators, the WTO summit triggered the largest wave of protests in the US since the end of the war in Vietnam.
What exactly happened during the great slumber of the nineties to precipitate this sudden outburst of public anger and at such a scale? Most likely world opinion had been so enthralled by the collapse of the Soviet Union and the socialist order that it was in a trance-like openness to the golden images suggested by globalisation hypnotists. It was only towards the end of this decade that the world awoke from its trance to discover the many discrepancies that had been seeded. "People before Profits" was that banner that perhaps most succinctly encapsulated the general disillusionment with the WTO. Moreover, it should also be emphasised that the primary core of demonstrators waving such banners before the television cameras in Seattle did not consist of idle mobs or political adolescents but rather of a broad array of professionals, union leaders, environmentalists and other major civil interest groups.
Third World countries are equally disillusioned by the skewed priorities being imposed on them. For most of them, at this juncture, the critical issue involves the pressures being brought to bear to deregulate now. In the past, decisions to assimilate into the global economy, to lift tariffs and open markets were largely left to the discretion of local leaderships and to their assessment of the particular circumstances of their countries. Now, under the Uruguay Round agreement, signatory parties, regardless of individual exigencies, are obliged to implement deregulating measures in accordance with a pre-arranged schedule to take immediate effect after the grace periods lapse.
Some African countries, and a number of others ranking among the world's poorest nations, had threatened not to take part in any agreement resulting from the Seattle summit because of the marginal negotiating role to which they had been relegated. During the conference, ministers of trade from the Organisation of African Unity (OAU) issued a joint statement expressing their disapproval of the manner in which negotiations at the conference were being conducted. The OAU statement was the first official reaction against the way in which the major powers commandeered the agenda of those important talks. Developing nations, which represent four-fifths of the WTO membership, complained that having agreed to shoulder numerous obligations in the 1994 Uruguay Round, the Seattle conference should have given far greater focus to their concerns.
Clearly, the US finds it difficult to accept the lengthy list of demands voiced by many developing nations, particularly those pertaining to intellectual property rights and trade-linked investments. To the US administration, these demands represent an attempt to reopen negotiations on agreements concluded in Uruguay. The US has countered that -- instead of renegotiating with the developing nations collectively, it would be willing to reopen negotiations on some issues on a bilateral basis with individual developing nations. Most developing nations have rejected this proposal.
The WTO conference in Seattle was, without a doubt, a complete and utter failure. It even failed to issue a closing statement outlining WTO operations for the beginning of the new millennium. It also failed in its plan to initiate a new round of negotiations over the deregulation of trade.
If the "battle of Seattle" did succeed in anything, it was to convince the US that any further talks over lifting barriers to world trade will not proceed as smoothly as it had imagined. In fact, any future talks will probably be doomed to equal failure as long as the industrialised nations continue to refuse to respect the balance of interests between them and the nations of the developing world. In every negotiating round to date, developing nations have had to bear the brunt of commitments without reaping the rewards of "free trade" commensurate with the heavy costs these commitments entail.
The International Federation of Independent Syndicates issued a statement declaring that the failure of the WTO conference might mark the beginning of new discussions over the substance of globalisation. An editorial in a Japanese newspaper remarked that the failure of the conference threw cold water on US hubris and demonstrated that it will not be possible to reach an international agreement over deregulating trade unless the interests of developing nations and other economic powers in the world are taken into account. Another Japanese newspaper wrote that the conference was an opportunity for both developing and industrialised nations to say 'no' to the US and to the arrogance with which it is comporting itself as the world's sole superpower.
Any future multilateral talks over the global economic system must recognise the intricate linkage between trade, financial and development policies. Perhaps the most important achievement of the failure of the Seattle conference is that it has put the breaks on the headlong rush to assimilate national economies into the globalisation process. The Group of 15 should take advantage of this historic opportunity. For these countries, and Egypt above all, the slogan "Fair trade not free trade" -- also brandished during the demonstrations -- should serve as a guiding principle. We have already had the occasion to observe that the glittering banner of free trade does not promise equitable treatment or global economic stability.
* The writer is professor of economics at Cairo University.
