Examination of witnesses (Questions 156
- 179)
TUESDAY 21 MARCH 2000
MS SABRINA
VARMA, MS
RONNIE HALL
and MR BARRY
COATES
Chairman
156. Can I start by welcoming you all and thanking
you for your written evidence to us which is very important. We
wanted to talk to you about it this morning, so I hope you will
feel comfortable and we will be able to develop a discussion on
your evidence and other matters. We have Sabrina Varma, who is
a food and trade policy adviser for ActionAid? Is that right?
(Ms Varma) That is correct.
157. Formerly of CIIR?
(Ms Varma) Yes.
158. And Ms Ronnie Hall, Environment and Development
Coordinator, Friends of the Earth?
(Ms Hall) That is right.
159. And Mr Barry Coates, Director of the World
Development Movement?
(Mr Coates) Yes.
160. We thought we would start by asking each
of you to briefly explain two things to us: (a) what are your
assessments of the Uruguay Round on developing countries, as a
first part of the first question, and secondly, what are your
principal objections to the new WTO trade Round? Each of you has
given us evidence rather hostile to a new WTO Round and that is
what we wanted really to explore. First of all, I think we should
start with the impact of the Uruguay Round and then look at the
objections to the new WTO Round. Perhaps it is sensible if I simply
take you in alphabetical order, as you sit facing me.
(Mr Coates) Firstly, in assessing the impact of the
Uruguay Round on developing countries, I think it should be taken
with a health warning that many of the agreements have not been
fully implemented by developing countries yet, according to the
schedule. However, there are a number of points to make. Firstly,
projections at the end of the Uruguay Round showed that sub-Saharan
Africa in particular would lose heavily as a result of the Uruguay
Round. I am not sure that anyone believes the exact magnitude
of the figures but figures of around 600 to 800 million US Dollars
per year have been estimated. Other developing countries have
stated that they are very concerned that they do not see any benefits
for their economies out of the Uruguay Round. This was particularly
the case at the high level trade and development seminar hosted
by the WTO last March, where developing country after developing
country expressed real concern that they are not likely to receive
any benefits from the Uruguay Round. They particularly laid some
of the problems at the feet of the industrialised countries for
not honouring their part of the agreement, particularly with regard
to liberalisation of agriculture and textiles. The second issue
is that developing countries are facing extremely high implementation
costs. You have, I know, received a lot of evidence. The most
relevant estimate—in fact, the only really credible evidence—is
a World Bank study showing that the cost of implementation of
a limited number of Uruguay Round agreements was around 130 million
US Dollars per year, which is larger than the annual development
budget for many of the smaller developing countries. The World
Bank went on to say that they felt there was no tangible benefit
for these countries from actually implementing these agreements,
despite the high cost. The third issue is that there has not been
a proper assessment of the current and likely future impacts of
the Uruguay Round. There is an opportunity now, before any new
negotiations, to do a detailed assessment, to learn lessons both
from the failures of the negotiations process for the Uruguay
Round and then subsequently Seattle; and to learn the lessons
from the difficulties of developing countries in implementing
these policies. There is a lot of work to be done and some very
serious questions need to asked about whether developing countries
have benefited. The broader statistics show that Least Developed
Countries' share of world trade continues to fall, raising a major
question about the impact not only of the Uruguay Round, but also
the impact of previous trade policies on developing countries.
This lack of assessment on the impact of the past Round was one
of the concerns that led to widespread opposition by non-governmental
organisations to a new Round. Very much leading from that, there
has been no assessment of the past Round. We do not have a recognised
and shared basis to move forward with lessons for a new Round.
Therefore, that is why NGOs have called for a review of past agreements.
Secondly, I think it is widely acknowledged that the existing
rules are deeply unfair whereby the poorer the country essentially
the higher the tariffs they face, such that the Least Developed
Countries face tariffs 30 per cent higher than the industrialised
countries.[27]
Therefore, the first priority, before considering any new Round,
is to repair the existing unfair agreements. The third issue is
that the process itself is deeply unfair, again as shown in Seattle
and as demonstrated by the very strong statements made by the
African Group, Latin American Group and Caribbean Group. The WTO
needs to be reformed, we believe before any new Round of trade
negotiations starts. This is a position that was echoed by most
developing countries in their submissions to the WTO, where the
Chair of the Group of Developing Countries (G77) used the phrase
"review, repair and reform" as a priority for the trade
system, rather than embarking on any new Round. I think we see
the depth of developing country opposition to the EU's proposals
for a new Round from the submissions that were filed prior to
the Seattle meeting.
161. Was your organisation represented in Seattle?
(Mr Coates) Yes, I was in Seattle.
162. In what capacity?
(Mr Coates) As an observer.
163. Were you organising the crowd outside or
the crowd inside?
(Mr Coates) Almost exclusively inside. One of the
things we did do was to talk at a number of public fora, to educate
members of the public about some of these issues. In Seattle I
addressed large meetings about the future of trade rules beyond
Seattle; what kind of directions do we need to go in, in order
to promote equitable and sustainable alternatives to the current
trade rules. Most of my time was spent within the conference centre,
lobbying governments, trying to improve the flow of information
between NGOs and governments, particularly trying to help many
of the developing countries who were extremely annoyed at being
marginalised from the negotiations. The NGOs, I believe, played
a very positive role in working with developing country governments
as well as the British Government in trying to get a more productive
process and a better outcome.
Mr Robathan
164. What you said is very interesting. You
quote one or two people representing various groupings in the
WTO, African countries for instance. The interesting thing is
that when we meet representatives of developing countries, I can
almost say to a man and a woman, they have said how they view
the collapse of the Seattle talks as a setback because they wish
to see economic development which they believe will come with
perhaps reform and perhaps change but another Round of WTO.
(Mr Coates) I do not by any means regard the collapse
of negotiations in Seattle as anything like a reason for celebration
or a victory for NGOs or anyone else. I think it is a tragedy
for developing countries because they have very real problems
at the moment with the trading system that are mitigating against
their development prospects. I think it is an absolute travesty
that the negotiations were not concluded in a way that would be
fair to developing countries. I would lay a lot of the blame for
that at the feet of the EU for their position on negotiations
in Seattle because ultimately, in my view, it was the EU that
was largely responsible for the collapse of those negotiations.
Mr Khabra
165. One of the reasons for the Uruguay Round
objection by developing countries is the cost. Is there any other
good reason why the developing countries have objections to the
next Round?
(Mr Coates) The objection to a next Round is also
founded in the concern over extending the mandate for the World
Trade Organisation into many new non-trade areas. For example,
the ongoing negotiations under agriculture and services already
account for fully 70 per cent of world trade. The EU's proposals
at the table at Seattle were to include issues like investment.
The annual production from foreign subsidiaries—ie, the
economic effect of foreign investment—is now larger than
the whole of international trade itself. Further, the EU wanted
to include government procurement on the agenda, to open up government
procurement to access by foreign multinationals. Again the value
of government procurement is larger than the total value of international
trade. In addition, the EU was proposing to introduce other non-trade
issues such as labour standards, whereas many developing countries
considered that the priority should be to review, repair and reform,
not to embark on new agreements that proceeded from a very unfair
basis and from a very unfair process. We agreed with their position
and opposed a new Round. Of particular concern to WDM was the
inclusion of investment which has been the subject of considerable
work by British Government committees with regard to the previous
proposal for a Multilateral Agreement on Investment (MAI). The
substance of the proposals that we saw from the EU in Seattle
was to continue the same objectives for an investment agreement
that were so widely discredited in the previous MAI.
(Ms Hall) I hope you will appreciate that there is
likely to be some overlap between us. Dealing first with the impacts
of the Uruguay Round, I think it would be fair to say that we
have found it, in the run up to Seattle, extremely difficult to
disentangle the impacts of the Uruguay Round from the impacts
of economic globalisation in general. That is partly because the
implementation of the Uruguay Round is not yet complete. We think
this is a particularly strong reason for the WTO and its member
governments undertaking a review of the Uruguay Round. We think
it is essential business practice for such reviews to be undertaken
before proceeding with further negotiations. We do not really
understand why governments are so resistant to this idea. I noted
in the report back from Mr Moore and Mr Low's evidence that they
had stated that the WTO does not have the resources to undertake
such a review. This seems to me to be quite a weak argument and
one that might be countered. Our general problem with the Uruguay
Round is that we think the current trade liberalisation process
is unacceptable because it prioritises international trade over
other social values and over local and regional trade. What the
Uruguay Round did was to increase the scope and power of what
was then GATT and is now the WTO, by introducing a lot of new
issues, including agriculture, investment, services and intellectual
property rights; and also by changing the framework within which
the agreements are administered by setting up the World Trade
Organisation and introducing a new and much stronger dispute resolution
system. We feel that the problems that were already there with
the GATT were actually exacerbated during the Uruguay Round. In
terms of sustainability, it is hard to pick out specific issues,
but I think the three that I would probably pick out are the impact
of the TRIPs agreement on genetic diversity and technological
development in developing countries; the impact of the Agreement
on Agriculture on support for agribusiness and its impact on small
farmers and sustainable agriculture around the world in both northern
and southern countries; and the fact that it provides a stronger
basis for challenging international and national environmental
legislation through the new dispute settlement system. Coming
on to the basis of Friends of the Earth's objections to a new
Round, as I said, we are firmly of the belief that no business
would proceed on this basis. There should be a review first. We
find it extremely surprising that a number of countries, primarily
the European Union, are pushing very hard for a new Round, implying
that there will be a win-win scenario and that it will benefit
developing countries when those countries themselves are objecting
to the idea of new issues being brought into the Round. This seems
to be disingenuous, to put it politely, and extremely patronising
to those countries as well. We are still concerned about the inclusion
of new issues in a Round and I was very surprised by Pascal Lamy's
remark at the final press conference in Seattle when he said that
he thought that the Seattle talks had collapsed because of the
complexity of the negotiations. I think I would agree with that
but seeing as it was the European Union and specifically the European
Commission that was pushing to have as many issues on the table
as possible I think that was a rather surprising remark. We also
have concerns about the reason that the European Union is really
pushing for these new issues. Our suspicion, if you like, is that
it is to protect the current subsidy system for agricultural production
and to try and extract the best concessions possible from other
countries in terms of services, investment, etc. We are also particularly
worried about the fact that, from recent readings of reports in
the Financial Times and other articles that have been circulated,
particularly on the Internet, it does now appear that the European
Union is really trying to use the built-in agenda negotiations
on agriculture to force developing countries' hand on the issue
of the new Round. We are getting reports from Indian NGOs of Lamy's
visit to India, saying that he is implying indirectly that the
European Union will not proceed with the built-in agenda negotiations
on agriculture unless countries agree to the Round. I have also
read reports in the Financial Times that imply that the
issue of whether the European Union and other countries will permit
zero tariffs on imports from LDCs is, to a certain extent, dependent
on their support for a further Round. I do not think this is an
acceptable approach at all. It does nothing to give developing
countries any indication of the genuine nature of what the European
Union are saying. We also hear that in the current European intergovernmental
conference the European Commission is making a bid for a fast
track authority because it wants to extend its negotiating mandate
to include services, investment and intellectual property rights.
Given the European Commission's behaviour in Seattle on negotiating
the Biotechnology Working Group, we feel that this is inappropriate
and should be questioned by this Committee and others. That is
probably enough. I could say more but I would like to just say
something on our view on the collapse of the Seattle talks.
Chairman
166. Were you there too?
(Ms Hall) I was. I coordinate Friends of the Earth's
international Trade and Environment Programme. We had 40 campaigners
from around the world present, from every continent, so it was
a big investment of effort and resources on our part. Our view
is that the collapse of these talks presents a very positive opportunity
for governments and people around the world to rethink exactly
what they want out of the trade system. We are very happy with
the development. It is also my personal opinion that developing
countries used it as an opportunity to assert their position in
international negotiations, to stand up for what they want, and
I think this has significantly changed the political dynamic.
We are also quite happy about that.
167. Were you inside or outside the hall? What
were you doing?
(Ms Hall) I was everywhere.
168. Were you encouraging a little rioting here
and there?
(Ms Hall) No, not at all. We had 40 people there and
almost all the campaigners that were there had accreditation as
NGOs or as media. Our main input probably was by having fairly
close contact with the various governments in the countries that
we are from and exchanging information between ourselves and indeed
sometimes between the various governments so that more people
knew what was happening. We also did a great deal of work with
the media. We also participated in the demonstrations outside,
but in a very peaceful way.
169. No problems with tear gas for you?
(Ms Hall) Even when you walk around several hours
after the demonstration, you can still get the effects of the
tear gas, but I was not actually present when any of that violence
was taking place.
170. You talk as if the European Union had a
position, but the Commission representatives failed to deliver
that position. Is that the case?
(Ms Hall) I believe that certainly is the case on
the issue of the Biotechnology Working Group. The Ministers and
the Commission attend these meetings with a slightly different
perspective. Ministers have to go home and are accountable to
their voters. Commission officials go home and they are accountable
in the end to the individual countries, but it is rather a different
situation and it was very clear in Seattle that Pascal Lamy was
determined to get a new Round and to get the issue of investment
on board at all costs, be it agreeing to a Biotechnology Working
Group or watering down other environmental provisions that they
had promised they would stand up for. This is exactly what we
had predicted six months beforehand so we were not surprised at
all.
Mr Robathan
171. Ms Hall, I am a member of Friends of the
Earth.
(Ms Hall) Good.
172. I often question whether I should continue
to subsidise it but I have done for some ten years. You said in
part of your evidence that there was nothing to tell developing
countries the genuine nature of what the EU was saying. What you
were really saying was that the developing countries could not
see through what the EU were really up to. Is that right? Was
that what your implication was?
(Ms Hall) No. The developing countries are fully aware
of the implications of the current negotiations but are in a difficult
negotiating position. The European Union and the Commission and
the Member States feed this line to the media and to the public
within Europe to give the impression that they are doing something
that will benefit developing countries. I do not believe that
is really the case.
173. It is a conspiracy?
(Ms Hall) No. There are many different individuals
involved in this. I do think that different people have different
approaches. For example, I think that the European Union's agenda
on environmental issues has a very northern slant. That is one
of the reasons why it is not really acceptable as a new issue.
I am absolutely convinced, for example, that Mr Meacher is fully
behind it and very, very genuine in his support for this agenda,
but I would not say that is the case with every single official
involved in these negotiations, no, unless they are convincing
themselves. I have my doubts.
Chairman
174. I am surprised both by you and Mr Coates
saying that this was the EU's fault with no mention of the role
of the United States.
(Ms Hall) The United States has never been particularly
enthusiastic about having a Round. We are talking about two different
things: whether there should be a new Round and the role of the
various countries in the collapse of the talks. In the case of
the new Round, the United States was never very keen on the idea,
it was much happier to deal with the negotiations on a sector
by sector basis and felt it would be better for the United States
to do that. In terms of the collapse of the talks, the US and
the European Union and the developing countries all had their
role to play,and civil society.
(Mr Coates) In the final hours of the meeting there
was a proposal on the table. We have a copy and the Committee
should try and get a copy, although it is one of these documents
that is usually not available to elected parliamentarians, along
with other documents. The draft negotiating text provided a basis
for a possible deal. It did come close to having the final deal
signed. Ultimately the EU considered the agriculture and investment
sections of the deal and basically pulled the plug on negotiations.
My understanding is that the EU would not agree to the wording
of the agriculture statement without the inclusion of investment
as a new issue in the Round. This demonstrated that investment
had become the European Union's top priority in negotiations.
175. Ms Varma, could you give us ActionAid's
view on these two questions?
(Ms Varma) I would like to thank the Committee for
its initiative in undertaking this inquiry and for inviting ActionAid
to provide oral evidence in follow-up to its written evidence
on what we see as some very important issues for developing countries.
In terms of our assessment of the Uruguay Round, we still are
very unclear what the evidence is in relation to what the positive
effects of the Uruguay Round have been on developing countries
and specifically on poverty reduction, which is why, as my colleagues
have said, there is such an important need for a proper review
and impact assessment based on experience rather than simple modelling.
Whilst recognising, as has already been highlighted, that developing
countries will not have fully implemented their commitments until
2004 and also recognising the problems of establishing a causal
relationship between whether the Uruguay Round actually caused
something to happen, I do not think this is an excuse or a justification
for not trying to look at what the actual impacts have been, particularly
if further liberalisation has been envisaged. I think there is
enough evidence, as far as we are concerned, that there have been
some negative experiences. At one level, the FAO's, UNCTAD's,
UNDP's and World Bank's assessments and studies have shown that
there have been some adverse impacts, in particular in ActionAid's
area of interest which is agriculture. The impact has certainly
been negative in a lot of cases and unbalanced. We cited in our
written evidence to you the FAO case study of Sri Lanka and the
situation where hundreds of thousands of jobs were lost in the
potato and onion industries as a direct result of Sri Lanka having
very low tariffs for those two particular products, which had
a very problematic impact for the economy as well as livelihoods
and food security. On another level, ActionAid's own work, we
work in over 30 countries covering Latin America, Asia and Africa.
Our own work has shown that there has been a threat to food security
and livelihoods in terms of a bias against small farmers in favour
of large producers and agribusiness. We have evidence, for example,
in Malawi, that the dumping of US semi-processed soya is undermining
domestic production as well as deterring value added production
of soya. This imbalance is quite important. In the post-Uruguay
Round period, we can particularly note that there have been import
surges in many countries. It has become a common feature and developing
countries at the same time have been increasing their domestic
support, which is exactly what Mike Moore told you in his oral
evidence a couple of weeks ago. You are very well aware of the
problem of tariff peaks and escalation for many developing countries
in products of interest to them. There has been very little delivery
on market access commitments in agriculture. There has been no
movement on the Marrakesh decision. These are all things left
over from the Uruguay Round. We also cited the case of the Jamaican
dairy farmers who are having to compete with EU export subsidies
and high domestic support levels. As a result, they are literally
throwing out their milk because they just cannot compete with
the cheap imports.
176. How many of them are there?
(Ms Varma) The dairy industry in Jamaica is quite
important. We can certainly provide you with exact figures.[28]
Still on this issue of imbalance, loopholes and exemptions within
the Uruguay agreement on agriculture for developing countries
are major issues. This needs to be urgently addressed as part
of the implementation agenda which developing countries have put
forward in the post-Seattle context. These are just some of the
things I wish to highlight when it comes to assessment of the
Uruguay Round. Moving on to our objections to the new Round, we
recognise the EU's position for a new Round and the basis of it
as well as DTI's support for that. However we are particularly
disappointed with DFID support for a new Round and what the analysis
and basis of that might be. Is it really realistic to expect the
trade negotiations to feature the interests of LDCs and developing
countries at the heart of the agenda? Let us look at what developing
countries and least developed countries are asking for and what
developing countries are actually willing to offer. Very little,
in fact. Even if you look at the initiative by the EU for essentially
all products, they cannot even offer all products, in particular
in key areas of interest or products for developing countries.
That does not even have the support of the other Quad countries
as yet anyway. In the end, trade negotiations are about power
relations and national commercial interests. So far, how can we
be guaranteed that the interests of developing countries will
be at the heart of any future new Round? Furthermore, we still
have no evidence from DFID on how the inclusion of new issues
will reduce poverty, which is a major concern to us. Second of
all, there is no evidence from what we have seen on the positive
relationship between trade liberalisation and poverty reduction
based on experience. Again, I emphasise this is why impact assessment
is so important. There are also the outstanding implementation
issues left over from the Uruguay Round, some of which I have
mentioned and which my colleagues have mentioned, which need to
be addressed first, instead of overloading the agenda with new
issues. A new Round is not needed to deliver some of the benefits
to developing countries which are owed to them from the previous
Round. What is needed is some political will on the part of developed
countries to deliver these benefits. There is the other very important
issue of institutional processes which need to be reformed first.
The collapse of the talks in Seattle shows us that there are fundamental
flaws with the processes of negotiation and therefore these issues
need to be addressed first, before embarking on a new Round. Otherwise,
developing countries will continue to get a raw deal from the
trade agreements. There is one particular issue we are highlighting
and that is this issue of trade-offs. We are told by the United
Kingdom Government that it is important to support the new Round
because it will allow more movement in areas of particular interest,
like agriculture, to developing countries. I think the issue is
a bit more complex than that. The question we might want to ask
is, for example, will increased market access in agriculture outweigh
the implications of an investment and/or a government procurement
agreement for developing countries? These are important issues
to consider. It is pretty much the basis on why we object to a
new Round. If I could quickly mention ActionAid's role in Seattle,
given that the issue has been raised, we have an international
food rights campaign which I outlined in our written evidence.
It involves a range of countries from Brazil to The Gambia. We
sent a delegation, including myself, of six to Seattle as part
of the WTO NGO accreditation under that scheme, but we also had
two members of our team who were official delegates on the African
government delegations. We also had one member of our team on
the United Kingdom Government delegation. In the lead up to Seattle,
we played quite an important role in terms of capacity building,
working with developing country governments, to analyse the issues,
to see what the implications were, particularly in agriculture.
At Seattle, we played a very supportive role in terms of promoting
and strengthening the positions of developing countries, especially
along the lines of the G77 position and the African Group position
on issues such as agriculture. In that sense, we acted as a source
of information and advice. We found the governments to be very
open and willing to talk to us and to discuss the issues. They
appreciated our presence there. In terms of why Seattle failed,
I think if we could pin it down to one thing, recognising all
the faults with the processes, it was definitely the inflexibility
of the EU and the US in taking on board the priority issues and
concerns of the developing countries.
Chairman: It is interesting that you
should mention the US because the US position has been emphasised
in evidence before this Committee as being wanting to incorporate
labour standards and environmental protection as being a cause
of breakdown.
Ann Clwyd
177. A number of suggestions have been made
on how exactly the reform of the WTO ought to be discussed. Stephen
Byers, as you know, has asked EU Commissioner Lamy to produce
a paper on ideas for WTO reform. You might be a bit sceptical
about that, given the views you have about the EU's role in the
breakdown. The Government has also supported the idea of a Group
of Eminent Persons consulting with WTO Member States and making
proposals for improving its procedures. What do you think so far
of these suggestions made on WTO reform? How do you think developing
countries are being involved in that consultation process? What
are your views on how the WTO should be reformed? Some of you
have already mentioned some aspects of that but could you just
address those questions directly, please?
(Mr Coates) The Eminent Persons Group has been described
by the Japanese, who also signed up to the idea, as academics,
consultants and business leaders. That description would suggest
that perhaps developing countries are not going to be particularly
deeply involved in such an Eminent Persons Group; nor is there
much provision for the involvement of civil society. Therefore,
under such a scenario, I think we would have severe doubts as
to whether it could do what needs to be done as a primary objective
of institutional reform, which is to re-engage the confidence
and trust of developing countries in the process and to restore
the confidence and trust of civil society. There is widespread
mistrust and a lack of confidence in the process and over whether
negotiators are looking at options that are good for the public
interest.
Mr Robathan
178. Who says why the civil society has lost
confidence?
(Mr Coates) The organisations represented here today
did a quick count and certainly marshalled the support of well
over a million people in the United Kingdom.[29]
It is our experience that there is very widespread mistrust of
what is happening in the international trade system, backed up
by a public opinion survey undertaken for the New Economics Foundation
before Seattle. I think there is real concern over what has been
happening with regard to international trade rules and particularly
a concern that negotiations have been captured by large, corporate
interests. Let me come back to the issues of reform. There is
one set of reforms dealing with the narrow terms of the process
itself, making a fairer negotiations process. I think that is
important. That is the primary scope of what is being called for
in terms of institutional reform of the WTO. However there are
far deeper issues for institutional reform that have not yet been
reflected in official proposals. One of them is the style of negotiations
within trade fora. They are very much reciprocal, tit for tat
negotiations. You give us a concession and we will give you a
concession. At one stage in the evolution of the trade rules this
may have been a useful approach. WDM considers that style of negotiations
is outmoded and inappropriate for issues of global importance
where cooperation is important. For example, when the US reached
an agreement with China over accession to the WTO, it was widely
hailed as agreement to China's membership of the WTO after 13
years of negotiation, although negotiations had not taken place
with the other 133 members of the WTO. This reciprocal style of
negotiations is still dominant. Furthermore, we see commercial
considerations as being dominant. As my colleague from Friends
of the Earth described, when trade-offs are required in negotiations,
the issues that are traded off first are the interests of developing
countries, the environment and other issues of public importance.
What remains are commercial considerations. For example, again
in the accession negotiations with China, the EU Trade Commissioner
is in China at the moment, negotiating with China. The key issue
is to ensure that EU companies can invest 51 per cent in telecommunications
firms in China rather than 49 per cent, as has been agreed with
the United States, demonstrating that issues of human rights,
labour standards, the environment and other issues of global importance
that vitally affect international trade did not enter into those
discussions at all. They were dominated by commercial considerations.
I think that is a real problem and it needs to be tackled with
regard to institutional reform of the WTO. A third issue is obviously
capacity, specifically the capacity of developing countries to
negotiate. I did a count in Seattle and the number of people on
EU Member States' delegations was 594. Most developing countries
had very few representatives there. By contrast some of the least
developed countries only had one or two representatives in Seattle.
That disparity in negotiating power, I believe, does not make
for fair negotiations. Furthermore, many developing countries
cannot afford to have permanent representation in Geneva. There
is a real issue of a lack of capacity to negotiate and a lack
of capacity to implement the agreements we have already talked
about. Finally, I think there is a deeper question about what
the WTO rules are for. What is the aim of the WTO rules? Very
often, it is portrayed as liberalisation as an end goal in itself.
If we look at the relationship between liberalisation of trade
and poverty reduction, which presumably this Government is concerned
about in the wake of the White Paper on International Development,
we see a very tenuous link. For example there is considerable
weight of opinion that calls for positive discrimination by developing
countries during their development process in order for them to
be able to build local industries and to develop. There is no
evidence of any country that has developed under the kind of conditions
that are now being proposed for developing countries under the
WTO. Every OECD country, every newly industrialised country, and
the Asian countries that have more recently developed have used
measures which would now be ruled out by WTO agreements. I think
this is an extremely dangerous state of affairs. We ought to be
questioning whether the goal of trade rules should be to promote
sustainable development and poverty reduction, rather than to
promote the liberalisation of trade policies which it is at the
moment. That calls into question the WTO's role within the international
system vis-a-vis other international organisations, particularly
the United Nations. These are deeper issues for institutional
reform. To our view, only the first of those issues is on the
agenda and developing countries are not even involved in that
discussion.
(Ms Hall) There is one small point I would like to
make about parliamentary scrutiny. There have been various proposals
from the WTO Secretariat and governments to increase parliamentary
scrutiny. Some of them focus on parliaments at the national and
European level and the WTO Secretariat wish to have a body of
parliamentarians meeting in parallel when there are Ministerials.
We would like to emphasise that we think increasing parliamentary
scrutiny at a national and European level is an extremely high
priority and should not be replaced with proposals to just have
international scrutiny.
(Ms Varma) I support the comments that have been already
made by Friends of the Earth and WDM. We see the reform agenda
as a very important piece of the agenda, but not sufficient to
address the issues that have come out of, for example, Seattle
and what happened there. The implementation issues are also a
very important part of the whole agenda. Just focusing on reform
itself is not going to do the trick.
Ms King
179. You have all basically in your memoranda
to us rejected a new Round at the moment. What I wondered is,
if a new Round is not launched, would you agree that it is likely,
commercial imperatives being what they are—and you have
just alluded to that—that developed countries will pursue
trade liberalisation through other fora such as the OECD, where
developing countries are entirely locked out, and in that way
will have their voice removed absolutely from trade liberalisation?
Do you recognise that as a danger?
(Ms Hall) That is a very interesting question. I do
not think it is likely that trade liberalisation negotiations
will be pursued through the OECD. What we do see as being the
case is that it will be pursued with increasing intensity through
regional trade agreements. There are a variety of different regional
trade agreements such as MERCOSUR and the proposed Mediterranean
Free Trade Zone, for example. These are fora that various different
Friends of the Earth International members have followed very
closely. I do not think that would mean any lack of involvement
for developing countries. It obviously depends on the balance
of the countries that are involved in each particular region.
27 Note by witness: Other developing countries
face tariffs 10 per cent higher. Back
28
Not printed. Back
29
Note by witness: The joint statement opposing a new Round
was signed by some 2,000 NGOs from over 90 countries. Back
|
