Al-Ahram Weekly   Al-Ahram Weekly
2 - 8 December 1999
Issue No. 458
Published in Cairo by AL-AHRAM established in 1875 Issues navigation Current Issue Previous Issue Back Issues

Front Page

Not quite a free for all

By Thomas Gorguissian

The WTO ministerial meeting has begun in Seattle, the Emerald City. Some 5,000 delegates -- trade ministers and officials representing 134 countries -- together with 40,000 demonstrators opposed to the new round, have gathered to discuss, argue, propose, and protest the on-going liberalisation of the global economy.

The World Trade Organisation, by some countries and for some groups, at least, is being presented as a panacea for the coming century. International trade, they say, will bring prosperity. Since 1994 the volume of trade has grown by 37 per cent, reaching $6.5 trillion last year.

Critics, though, insist that the costs exacted on poorer economies, on the environment, and on labour, even inside the United States, have been exorbitant.

The White House remains optimistic that the WTO talks in Seattle will mark "a new type of round for a new century: a round that is about jobs and development". President Clinton is attending the summit, though several other world leaders have refused to attend. And many who oppose the WTO and its promotion of globalisation view the Seattle event with suspicion, as heralding the final triumph of the new orthodoxy of liberalisation.

US Trade Representative Charlene Barshefsky addressed the National Press Club prior to the Ministerial Meeting, painting a rosy picture of the WTO's achievements over eight negotiating rounds, during which time there have been 10 US administrations and 26 congresses. "A more open, fair and free world economy" had been brought about by the WTO, she said. The US, she continued, is seeking more open markets and less trade barriers because "almost 80 per cent of world's economic consumption and 96 per cent of the world's population is outside the US."

US labour organisations, represented among the protesters, share a different agenda to their trade representative, though, and are concerned about job losses brought about by the flooding of the domestic market by cheap foreign products.

The administration remains keen, nonetheless, on mobilising support for the Seattle round. "Expanding opportunities for American agriculture, and for American goods and services" has become almost a mantra as officials seek to underline the benefits that will accrue to the US -- a major agricultural exporter -- by securing more open trade in agricultural products.

To realise such expansion, Washington is seeking to eliminate export subsidies, especially by the European Union which, according to the US spends 50 per cent of its budget on agricultural supports "that distort trade". The US is also hoping to ensure market access for genetically altered food, a process that is likely to see the administration come into conflict with an increasing number of vociferous opponents.

Washington will also be seeking to boost its exports of services. The US is the world's largest exporter of services. In 1998 alone, American service exports reached $264 billion dollars, a market the Americans are keen to see further expanded. Finance, telecommunications and construction, and new services such as telemedicine, satellite entertainment and on-line instruction are all areas that Washington hopes to push.

It is electronic commerce, though, that will absorb the majority of US official attention. There is no doubt that the US wants to dominate this newest and highly-lucrative form of trade. According to official US figures, the market for e-commerce totaled over $50 billion in 1998, and is expected to reach $1.4 trillion by 2003.

The Clinton Administration, it has often been noted, has consistently treated trade as the engine of its foreign policy. Almost 300 trade agreements between the US and other countries have been negotiated over the past seven years.

"We have embarked upon the longest peacetime expansion in our history; creating 19 million new jobs; reducing unemployment to 4.1 percent; seeing family incomes begin to rise again after a long period of stagnation," insisted the US trade representative.

The unrelenting, up-beat tone to official American announcements, and the apparent desire to conquer the world through trade negotiations, has riled many activists and economists.

In his speech at the Third Ministerial Meeting of the WTO, World Bank President James Wolfensohn urged wealthy developed nations to eliminate trade barriers for the sake of the "three billion people who are living on less than $2 a day". Wolfensohn said that manufactured exports from developing countries to the developed world face barriers four times higher than those from the developed, industrialised countries. The World Bank President asked world leaders gathering in Seattle this week to ensure that the world's poor become full partners in the potential gains from world trade -- "not just to be at the table, but to have a voice, and to be heard." It makes no sense, he argued, to urge poor countries to reform their economies, to urge them to compete and "pay their way in the world, while denying them the means to compete".

If free trade is the aim, the obvious question is whether such trade will at the same time be fair.

"I am absolutely convinced that developing countries, including advanced developing countries like Egypt, have a tremendous amount to gain out of this new round," insisted Alan Larson, US undersecretary of state for economics, business and agricultural affairs. "Egypt is a potential agricultural exporter. It also has the potential to make great use of electronic commerce. I know that president Mubarak has mapped out a vision of the Egyptian economy that calls for high growth and the creation of new jobs in these high-technology areas."

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