Harbinson’s draft for economic talibanisation of WTO

by Chakravarthi Raghavan

Geneva, 28 Oct 2001 - Developing countries are now faced with a draft ministerial declaration and other documents for the Doha ministerial that is perhaps the most biassed document yet to emerge in such a process in the 53-year history of the trading system - in terms of what they are asked to take on board and negotiate for new obligations, and in a process that makes the old 1986 Punta del Este declaration and its modifications in the 1989 mid-term review innocuous.

A set of four documents - a draft ministerial declaration, ‘JOB(01)/140/Rev.1’, draft ministerial decision on implementation issues and related concerns, ‘JOB(01)/139/Rev1’, a draft declaration on Intellectual Property and [Access to Medicines][Public Health], ‘Job(01)/155’, and a separate document by the secretariat of the compilation of outstanding implementation issues raised by Members - were issued at around mid-night of 27/28 October, 24 hours after the original promised deadline of Harbinson.

There is some collateral evidence for African suspicions that the delay in issuing the documents, was to prevent African diplomats from being able to brief their ministers in time for meetings this week in Washington (of the African Growth and Opportunity Act, the AGOA; beneficiaries that were called in by the USTR) and the EC-summoned meeting in Brussels of the ACP countries - two groups that have so far stood pressures from the WTO, the US and the EU, to yield to them.

The documents which Harbinson wants to send to the Ministers at Doha on his own authority are so one-sided - without anywhere, beyond the covering notes that these are not agreed texts, showing the serious differences of substances and not mentioning the alternative formulations handed over to him in writing - that it will de-legitimise even more the Doha meeting and its outcome, even if the documents are accepted and negotiations are launched. Civil society protests may be silenced in the North in the current ‘anti-terrorism’ atmosphere, but in the South, it will probably in fact strengthen opposition to the WTO and the US.

Given the fragility of the world economy, no trade policy, national or global, can help to counter the global recession; and the perverted Keynesianism in the US and centres, and aggressive neo-mercantilism on the developing world will in fact aggravate matters.

The launch of a new round of WTO trade negotiations with an expanded agenda was presented by the USTR Robert Zoellick, and the EC Commissioner Pascal Lamy, very soon after the 11 September terror attacks, as the answer to the Taliban and Bin Laden’s terrorism, as well as by US Federal Reserve Chairman Alan Greenspan, as the answer to the global recession. Several reputed economists have challenged these views.

In effect, the Ministerial Declaration, if it survives and goes through at Doha, is neo-mercantilist, neo-liberal economic fundamentalism and shows the same scorn for the poor and innocent people’s lives and welfare.

Given this, the developing countries face difficult options: they could insist upon Harbinson bringing out a third draft, clearly formulating under each work programme, the alternatives given to him by 31 October or as a second best to force him to send an accompanying letter or report to Ministers (that members must first see and okay it), to be an integral part of his draft documents, setting out the various other views clearly, and the General Council report with the formal statements by the various Members. They could also make clear that if this is not done, their consensus to Harbinson presenting any document, even on his own authority, could not be given.

The WTO rules and practices leave little room for doubt on this.

If no such assurances are forthcoming, even the waiver of the ten-day notice for the agenda can be withheld.

There will be an outcry from the pro-WTO, pro-corporate western media of  developing countries or a few of them ‘wrecking the conference’, though when developed countries themselves block things elsewhere, it becomes a defence of their vital security rights and hence is justified.

For, on almost every issue on the table since before Seattle, the Harbinson ‘compromise’ has formulated what the US and EC want - and thrown into the Geneva lake adjoining the WTO headquarters building all the proposals and formulations of developing countries. That in some parts of the preambular paragraphs on assessment, some of the perceptions of the developing world has been partially reflected, cannot hide the totality of the bias.

Even the manner of ‘consultations’ by Harbinson in ‘Room D’ of the WTO building, where there are seats with microphones and listening facilities only for 112 delegations (in a membership of 142), and the way he has drawn his conclusions in the revised drafts, completely ignoring the views of the developing countries, is a mockery of the para in the declaration for Ministers to affirm their “collective responsibility to ensure internal transparency and effective participation (there is no mention of decision-making!) of all Members.”

The most glaring bias in the revised version is the way that the question of ‘market access for non-agricultural products’ and the four Singapore issues (investment, competition, government procurement and trade facilitation) have been formulated and presented.

On all the Singapore issues, the entire group of Least Developed Countries, and the African Group, have taken the stand that they were not ready to negotiate and take on obligations on any of these issues, and that the study process should continue. India, Malaysia, Indonesia, the Philippines and several others in Asia have made their opposition known. However, they have all been ignored, and the subjects have been formulated for negotiations, in the process taking the earlier extremist positions of the US and EU, perhaps to enable the non-option of the ‘opt-in, opt-out approach’ for investment to be sprung at Doha as a magnanimous ‘compromise’ from the EC.

Though presented as a focussed work programme to identify elements for negotiations until the 5th ministerial, there is an automatic built-in agenda for the negotiations, with the ability of the 5th ministerial to make the agenda even wider.

And by having a separate General Council process on ‘trade and transfer of technology,’ the issue has been in effect taken out of the scope of any investment and competition negotiations and rules or a focussed study - given that the two negotiating mandates are aimed at expanding the scope for activities of Transnational Corporations and the issues of their corporate practices and technology policies and monopolies are very closely inter-related.

The hypocracy of the major partners is best seen in the formulations about least developed countries - long in stating some aims, but very short in actual benefits - as also in the special and differential treatment and the proposed framework agreement, where there has been some virtual consensus, but is held up by a few (very powerful) members. It remains still a best endeavour effort even in terms of the work programme.

The Organization and Management of the Work Programme retains all the free-wheeling devices built into the mandate at Punta del Este and then at the 1989 Mid-Term review that resulted in such agreements as the TRIPS, which a number of trade economists now acknowledge should not be in the WTO - though some of their claims of opposition, from a purist trade view, even in 1990, is somewhat questionable, since all that they had suggested then was for plurilateral agreements, leaving the door open for opponents like India to join later.

The same arguments against investment, mutatis mutandis, apply to the way that competition policy, government procurement and trade facilitation are presented to the ministers.

On the issue of Market Access for Non-Agricultural Products, a range of  countries, more than half the membership - the least developed and the African group specifically presented their minister’s demand that there should be a clear and focussed study of the effects on developing and least developed economies of the tariff-cutting that has been effected unilaterally under the

World Bank/IMF structural adjustment policies, and now, the poverty reduction strategies, or past trade liberalisation exercises. They have been supported and endorsed by Turkey, India and several others. Some other developing countries that have supported negotiations have focussed mainly or with emphasis on tackling the tariff peaks and escalations. All these have been ignored in setting a mandate that is wide in scope. The addition in the mandate about negotiations taking fully into account special needs and interests of developing countries is a pro forma formulation that has been ignored repeatedly since before the Tokyo Round.

On negotiating WTO rules (subsidies and anti-dumping and other trade defenses invoked frequently by the industrialized world against exports of developing countries), areas where the US and other industrialized countries are opposed to any ‘modification’ of their rights and instruments, the mandate for clarifying and improving disciplines is virtually defeated by the use of the words “preserving the basic concepts and principles underlying them.”

Even more important is that a number of questions raised by developing countries, and figuring on their ‘implementation agenda’ and falling in these areas, are all subject to and subsumed into these rules negotiations (in effect for maintaining the ‘basic concepts and principles underlying them’, rather than correcting the inequity and imbalances in the rules and their application).

The environment agenda, where save for the EU, there has been a wide swathe of opposition to new rules and disciplines or negotiations that would increase the powers of importing countries, the formulations in effect set an agenda for negotiations that could be launched at the next ministerial conference.

The pre-ambular para, with some sugar coating about not using them for ‘protectionist purposes’, is likely to be seen as an unambiguous endorsement of  right to trade measures on grounds of health, safety and environment protection - a right which is being denied to developing countries under the TRIPS agreement!

The para would reaffirm the strong commitment of members “to the objective of sustainable development, as stated in the Preamble to the Marrakesh Agreement” - an objective thwarted in the rules and practices of various agreements. And while talking too of the aims of upholding and safeguarding an open and non-discriminatory multilateral trading system and acting for the protection of the environment and the promotion of sustainable development being mutually supportive, the preamble opens the way for some unilateral measures as exceptions: “We recognize the right of Members under WTO rules to take measures to uphold and enforce the levels of health, safety and environmental protection they deem appropriate. We agree to ensure that measures taken to address such concerns shall not be used for protectionist purposes.” The dispute process has not made a conspicuous success of this last claim, when it comes to the ‘evolutionary’ way it interprets the rules to support the actions of some powerful partners.

And the subsequent mandate on trade and environment lays out a whole new agenda for negotiations, though in theory it is subject to future decisions. The mandate calls for continuation of the work programme, but giving particular attention to the effect of environmental measures on market access and those situations in which the elimination or reduction of trade restrictions and distortions would benefit trade, the environment and development; the relationship between the multilateral trading system and multilateral environmental agreements (MEAs); the relevant provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights; and “labelling” (emphasis added). The whole range of ‘labelling’ has been brought in.

And while the work programme calls for identification of the need to clarify existing rules, and the CTE is asked to report to the 5th ministerial, there is the not-so-hidden agenda for negotiations.

If developing countries are unable to stop negotiations now on the many more complicated issues, and to which they are vehemently opposed, it is silly for anyone to pretend that they would be able to oppose them at the 5th ministerial conference. At Singapore, the united phalanx of Third World opposition to investment, competition, government procurement and trade facilitation, was suddenly compromised by the Malaysian Trade Minister announcing her willingness to accept a study process. It was then defended on the ground that no negotiations could be started without consensus. Now negotiations are in fact being launched.

In effect, these and other ‘compromises’ will result in a worse debacle than at the 1989 mid-term review.

The mandate for the organization and management of the work programme provides for the 5th ministerial to take stock and provide any ‘necessary political guidance’ and take decisions as necessary. This is a very wide-ranging mandate to bring in more subjects, or alter the scope of subjects to suit the needs of the majors. And the provision, ala Punta del Este, for a Special Ministerial Conference session to decide at the end of negotiations, on the adoption and implementation of the results is a violation of the Marrakesh agreements. - SUNS4998

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

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