Can system be back on rails?

by Chakravarthi Raghavan

Geneva, 10 Jan 2000 -- The World Trade Organization and trade diplomats returned to work this week after the holidays -- trying to figure out whether and how the system can be back on the rails.

In the days immediately following the WTO Ministerial debacle at Seattle (30 Nov to 3 Dec 1999), there had been much writing and analysis of the causes and effects, with focus on 'fixing' the decision-making process, and ignoring the more substantive causes.

But a number of elements contributed to that debacle.

The four majors, particularly the US, Europe and Japan had deep differences in their approach to Seattle and beyond.

The four had even more differences with a large number of developing countries who were disillusioned with the outcome of the Uruguay Round, and under pressure from their enterprises and the public and parliaments to set right things and not take on more commitments.

There was also the growing opposition among the ranks of the developing country negotiators -- very much in evidence through 1999, both during the 'selection/election' processes for the choice of a Director-General and over the substantive preparations for Seattle -- over the efforts and attempts of the secretariat to re-introduce the discredited and unrepresentative 'green room' processes of decision-making, thus further the interests of the major countries and their corporations.

Compounding it all was the 'arrogance of power' of the host country and the administration, typified perhaps by the statement of the chair of the conference, Mrs Charlene Barshefsky -- she found herself unable throughout the conference to separate her role as chair from that of her position as US Trade Representative -- who announced on the second day of the conference that she would change the rules if she felt it necessary to get a declaration out of that conference.

Coupled with failures of a host to guests, this probably was the last straw that broke the camel's back.

And there was the deep alienation of the public in every country with the national and international systems where the governments and corporations have been perceived to be in alliance to further corporate profits and greed.

Those from civil society who came out in opposition at Seattle were very much divided among themselves as to why they were opposed to the WTO -- with those seeking to promote the cause of turtles joining those seeking to preserve the rights of organized labour in steel and other US industries.

And while there were other non-government groups battling the fundamentals of 'globalization' and seeking to defend their (US) local autonomy, and tried to relate their positions to those from the developing world, very few of them really understood or sought to further the cause of the developing world.

To try to isolate the problem to one of finding a compromise between 'transparency' and 'efficiency' of decision-making, with emphasis on need for 'efficiency', or one of accommodating the concerns of the industrial world by catering to its domestic constituencies on superficial approach to labour rights (and other 'governance' issues) or to environment protection may not even produce short-term solutions.

But it is a safe bet that international economic negotiations, and more specifically multilateral trade negotiations within the WTO system can never be the same again, and it will be now more difficult, when there is much greater public awareness of effects, to repeat the Uruguay Round processes.

It was possible in 1989 for the GATT Director-General to promote quietly a US-EC understanding (aiming on long-term reform of agriculture, while putting aside focus on short-term changes) and use it to split the developing world on TRIPS and Services and even tariff cuts and commitments.

It was again possible in 1993 -- when a few 'cooked up deals' and forced them on the rest, while beguiling the public outside with mouth-watering predictions of welfare and consumer benefits at the end of the Round.

But it will not be easy to repeat either of those events. (SUNS4581)

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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