From financial obscurity to fulminating monster in a few short years, trade liberalisation is threatening to reach into virtually every area of our lives. Healthcare services, the environment, decision-making in national and local government – all could be affected by the fast-moving tentacles of a beast which some still applaud as a good idea. For millions, the threat is already reality – the beast has them in its jaws.
On the last day of this month, trade ministers from the 134 countries that belong to the World Trade Organisation meet for four days in Seattle, the home of Microsoft and Boeing, to launch another round of negotiations to liberalise trade still further. In 1993, trade ministers signed the Uruguay Round agreement which slashed barriers to trade by an average of 40 per cent and brought the WTO into being. Now they are back for more.
Yet the international resistance to further trade liberalisation is now on a scale comparable to the campaign against apartheid. It involves environmentalists and labour unions, third world development groups and consumer organisations. Some are receiving training in civil disobedience techniques and intend to disrupt the Seattle meeting. All agree that the proposed Millennium Round of trade liberalisation will lead to a further concentration of power in the hands of transnational corporations.
To get a flavour of what Seattle is all about, listen to the EU’s new trade commissioner, Pascal Lamy. He told a recent meeting of trade ministers that something had to be done about government regulations on foreign investment because “our enterprises have asked us to act”. Not, please note, because the voters in European countries have asked anybody to act, but because companies have done so. Under Lamy’s proposal, any national legislation that stood in the way of trade would be at risk. In effect, he is talking about a revival of the notorious Multilateral Agreement on Investment (MAI), which bit the dust after worldwide protests last year. If it had gone ahead, it would have allowed transnational corporations to sue governments for introducing environmental or social legislation that might curb their investment.
Whether or not the Millennium Round covers investment, it will certainly review agriculture. Developing countries that have lowered their barriers to trade have already seen a big increase in food imports, but no corresponding rise in food exports. The small-scale farmers of Africa, Asia and Latin America find they cannot compete.
Thus in Sri Lanka, for example, the UN Food and Agriculture Organisation has reported that at least 300,000 rural jobs have been lost since 1996. Indeed, it is possible that, in developing countries as a whole, more than 20 million people have been driven from their land because of trade liberalisation. It isn’t only farmers who are affected. Last year, India removed its barriers to soya bean and edible oil imports. According to Vandana Shiva, an Indian agriculturalist, the imports have increased by 300 per cent and thousands of small oil extractors have closed down, destroying the livelihoods of at least three million people. The Chinese people, too, are likely to suffer from the announcement on 15 November that their country will join the WTO. “The number of people out of work is bound to surge,” according to a researcher from the Chinese Academy of Sciences, quoted by the Financial Times.
So the battles on the streets of Seattle will be fierce. But there will be fire, too, in the ministers’ meeting room. Developing countries will resist attempts by the United States to scrap all the remaining barriers to trade in agricultural products and services. The US government has reduced the support it gives to American farmers and said: don’t worry, you can sell more abroad. But most people abroad don’t want to buy US foodstuffs.
“Only she was from Seattle, where her Daddy raises cattle” ran a 1950s Guy Mitchell song. Today, Daddy’s cattle are stuffed full of hormones, leading to more meat per beast and to a glut of beef that US farmers are desperate to sell on world markets. As for Daddy’s corn and soya, that’s likely to have been grown from genetically modified seed and, again, no one wants it.
The US interest in the WTO talks lies in trying to force other countries to open up their markets to such products – the wishes of Cargill, Monsanto, Chiquita and other US agribusiness corporations dictate it. But there is a hint of desperation about it all. It must surely have occurred to some corporate soul that you can open up a market, but you can’t make people buy from it.
Washington is now offering inducements to developing countries to support its stance. In September, President Clinton announced that the US would wipe off debts that were owed it by some of the world’s poorest countries, mostly African. He said he was responding to an appeal by the Pope. The following day, a US agriculture official said that the US had formed an alliance with sub-Saharan African countries on the Seattle talks.
The attempt at such a “debt relief for trade support” deal is a classic US tactic. But most developing countries are likely to insist that their markets will not be opened any further unless western countries open up their markets by, for example, scrapping or at least modifying the EU’s Common Agricultural Policy.
If developing countries stand firm for what they believe in – and Clare Short, Britain’s Secretary of State for International Development, supports the idea of a “development” round of talks- then fundamental changes will be needed in the way the WTO operates. Developing countries must have the right to safeguard their food production and rural livelihoods. Legislation drawn up by democratically elected parliaments must hold sway over any decisions of the WTO. Above all, the Millennium Round must develop a system of fair trade, rather than free trade, a system that does justice to the most vulnerable people in society. And that would include doing something to regulate the power of transnational corporations.
“I recommend that the system undergo some fundamental change,” Panitchpakdi Supachai, Thailand’s deputy prime minister, said recently. “It is high time we made it serve our development goals.” Which is probably why the US opposed his candidature for the top WTO job this year.
“We are trying to prepare a globalisation that is as all-encompassing and controlled as possible,” says Lamy. Chilling words that help to explain why trade is arousing more passion than probably any other issue at the end of the second millennium, and why the outcome of the battles of Seattle will shape the lives of rich and poor alike in the next.