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

Bones of contention

THE SEATTLE summit faces a number of unresolved issues, any one of which may prove capable of derailing negotiations.

Agriculture is likely to be the area that attracts the most virulent discussions. The US, Argentina, Australia and Brazil are seeking an end to all forms of agricultural protectionism while the European Union, Japan and others are fighting to safeguard their own, heavily protected agricultural sectors.

The EU, together with Japan and Korea, claim that farming merits special treatment because it is a multifunctional activity with social and environmental implications. It should not, they see, be reduced to the simple mathematics of trade.

"There is a tendency by the EU and others to want to preserve the status quo and that is not acceptable to the US. The status quo works to the disadvantage of our country, which is export dependent," insists Dan Glickman, US agriculture secretary. Japan, though, is taking a particularly hard line, and has repeatedly made public its refusal to see farm products treated in the same way as other goods.

The fight over agricultural production is likely to reach fever pitch when the talks get round to the question of genetic modification, with the EU and Japan intent on regulating trade and the US, the main producer, equally insistent on no WTO regulation.

Anti-dumping measures will also be the focus of heated discussion. Japan has already accused the US of using anti-dumping regulations selectively, in order to protect its own industries. In this instance Tokyo will find itself allied to many developing countries, who are demanding much tighter definitions of dumping in order to prevent what they see as abuse.

Labour conditions, too, could cause an upset, with seeking the creation of a working forum between the WTO and the International Labour Organisation on "trade, globalisation and labour issues" and the Brussels-based International Confederation of Free Trade Unions calling for a working party to examine how to incorporate core labour standards in WTO agreements.

Envoys of developing countries, as well as Japan, oppose any such moves. They object, too, to similar moves to bring environmental issues to the negotiating table. Morocco, speaking for the Group of 77 developing countries, rejects any trade and labour tie-up, insisting social issues remain outside the mandate of the WTO.

Another vocal player in the dispute over labour is the US trade union movement. A leader of the powerful AFL-CIO labour federation announced that "the fact that the WTO meetings are taking place in the US gives us an opportunity to highlight the need to pay attention to enforceable workers' rights and put out the message that unless globalisation works for working people it is not working."

What is the WTO?

ESTABLISHED in January 1995, the World Trade Organisation (WTO) transformed the General Agreement on Tariff and Trade (GATT) into an enforceable global commercial code.

The WTO's trading system is half a century old. Since the failed attempt to create an International Trade Organisation in 1948, the GATT had provided the rules for the global trading system. The second ministerial meeting held in Geneva in May 1998, included a celebration of the 50th anniversary of the world trading system.

The GATT's trade rounds were usually lengthy, the Uruguay Round took seven and a half years. They offered a packaged approach to trade negotiations, and did not focus on a single trade issue or dispute. At the Uruguay Round there was a mad rush for new members to join the budding multilateral trading system.

The WTO is the only international body dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world's trading nations.

These documents provide the legal ground-rules for international commerce. They are essentially contracts, binding governments to keep their trade policies within agreed limits. In other words eventually the WTO will cover every area of economic life from production to exporting and importing. In theory the WTO would facilitate the production of goods and services, as well as assist exporters and importers conduct their business.

The WTO is perhaps the single most important international institutional mechanism of corporate globalisation. The WTO's 700-plus pages of rules set out a comprehensive system of corporate managed international trade.

Under the WTO's system of corporate managed trade, economic efficiency, reflected in short-run corporate profits, dominates all other factors and values. Decisions affecting the economy are to be exclusively confined to the private sector, while social and environmental costs are to be borne by the public.

Critics say that the WTO lacks transparency, a democratic process and accountable decision-making. They fear that giant transnational corporations are tightening the noose round poor people and countries.

Doubts are raised about the fairness and impartiality of the WTO Dispute Settlement Process. There are concerns that WTO tribunals operate in secret. Documents, hearing and briefs are confidential. Only national governments are allowed to participate, even if a state law is being challenged. Cases are decided by a panel of three trade experts. Every single environmental and public health law challenged at WTO has been ruled illegal. There are no outside appeals.

This leaves poor countries at a great disadvantage. Once a final WTO ruling us issued, losing countries have a set time to implement one of three choices: change their laws to meet the WTO requirements, pay compensation to the winning country, or face non-negotiated trade sanctions.

There are growing concerns that the WTO's pro-corporate, pro-profit outlook and powerful enforcement mechanism would put the interests of developing countries at risk and would pose a threat to laws designed to protect consumers, workers, and the environment.

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