[E-rundbrief] Info 40 - Walden Bello: Its Time for Global Civil Society - WTO failed

[Matthias Reichl]

E-Rundbrief - Info 40

Bad Ischl, 10.10.2003

Begegnungszentrum für aktive Gewaltlosigkeit
www.begegnungszentrum.at

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The WTO Cancun Ministerial has Failed. It's Time for Global Civil Society 
to Work for Bigger Victories

By Walden Bello*

(This article appears in Bangkok Post, Perspective Section, Sept. 21, 2003.)

When the chair of the World Trade Organization's Fifth Ministerial, Mexican 
Foreign Minister Luis Derbez, declared that there was no consensus and 
abruptly ended the meeting in mid-afternoon on September 14, his act had 
momentous consequences.

First, the collapse of the WTO meeting represented a victory for people 
throughout the world, not a "missed opportunity" for a global deal between 
North and South. The so-called Doha Round initiated in Qatar during the 
fourth ministerial in November 2001 was never a "development round." And 
what little promise it offered for the poor countries had been betrayed 
long before Cancun. Emblematic of this state of affairs was Washington's 
refusal to live up to the Doha Declaration's placing public health concerns 
over the patent rights of its pharmaceutical corporations up till the eve 
of the ministerial and its agreeing only after it got the developing 
countries to agree to a cumbersome procedure that would make cheap imports 
of life-saving drugs for people suffering from HIV-AIDS and other dreaded 
diseases extremely difficult.

Not even the most optimistic developing country came to Cancun expecting 
some concessions from the big rich countries in the interest of 
development. Most developing country governments came to Cancun with a 
defensive stance. The big challenge was not that of forging a historic "New 
Deal" but one of preventing the US and the EU from imposing new demands on 
the developing countries while escaping any multilateral disciplines on 
their trade regimes.

In this regard, it was not the developing countries that brought about the 
collapse, as US Trade Representative Robert Zoellick implied in his final 
press conference. That responsibility lies squarely with the United States 
and Europe. When the second revision of the draft of the ministerial text 
appeared early on Saturday, Sept. 13, it was clear that the US and the 
European Union were not willing to make any significant cuts in their high 
levels of agricultural subsidization even as they continued to 
intransigently demand that the developing countries bring down their 
tariffs. It was also clear that the EU and US were determined to disregard 
the Doha Declaration's stipulation that the explicit consensus of all 
member states was required to begin negotiations on the so-called "new 
issues" of investment, competition policy, government procurement, and 
trade facilitation.

Negotiate on our terms or not at all: that was the meaning of the second 
revision. Not surprisingly, developing countries could not lend their 
consensus to a framework of negotiations so detrimental to their interests.

Second, the WTO has been severely damaged. Two collapsed ministerials 
(Seattle, Cancun) and one that barely made it (Doha) recommends the 
institution to no one. For the trade superpowers, it is no longer a viable 
instrument for imposing their will on others. For the developing countries, 
membership has not brought protection from abuses by the powerful 
economies, much less serve as a mechanism of development. This is not to 
say that the WTO is dead. There will be efforts to bring the WTO back from 
the brink, like the US and the EU did at Doha. But the likelihood is that, 
with lack of momentum from a successful ministerial, the machinery will 
slow down significantly. Zoellick was correct in doubting that the Doha 
Round will be finished by its deadline of January 2005 and European Union 
Trade Commissioner Pascal Lamy was simply trying to put a bright face to a 
bad situation when he said that the WTO had completed 30 per cent of the 
Doha agenda.

Aside from the loss of momentum and the impairment of the basic functioning 
of the organization's machinery, growing protectionism in the rich 
countries, a global economy plagued by long-term stagnation, and the 
unraveling of the Atlantic Alliance owing to political differences on 
issues such as Iraq do not provide a favorable climate for the WTO's 
serving as the main mechanism for trade liberalization and globalization. 
The WTO may eventually suffer the fate it helped inflict on the UNCTAD 
(United Nations Conference on Trade and Development): surviving but 
increasingly ineffective and irrelevant.

This raises the question: even was we approve of the failure of a 
ministerial that was loaded against the interests of the developing 
countries, should we welcome the institutional weakening of the WTO? After 
all, some have argued, the WTO is a set of rules and machinery that, with 
the appropriate balance of forces, can be invoked to protect the interests 
of the developing countries. Partisans of this view say that one is better 
off with the WTO than with the bilateral trade deals that US Trade 
Representative Robert Zoellick said at his final press conference would now 
receive Washington's priority after the failure of Cancun.

The truth is that this is a false choice. The WTO is not a neutral set of 
rules, procedures, and institutions that can be used defensively to protect 
the interests of weaker players. The rules themselvesthe main ones being 
the supremacy of the principle of free trade, "most favored nation" 
principle (that countries must provide to all partners the privileges they 
provide their most favored partner) and the principle of "national 
treatment" (that foreign service providers must have the same rights and 
privileges as domestic providers)institutionalize the current system of 
global economic inequality.

What weapons the weak countries have are few. The principle of special and 
differential treatment for developing countries (that they must have a 
different set of rules from developed countries owing to historical and 
structural differences), which was institutionalized in the predecessor of 
the WTO, the General Agreement on Tariffs and Trade, has a very weak status 
in the World Trade Organization.. Indeed, in Cancun, the US and the EU 
completely banished from negotiations the special and differential 
treatment agenda that had been mandated by the Doha Declaration. The 
arrogant attitude toward such demands was exemplified in one US trade 
spokesman's dismissive statement that the WTO was "not a welfare 
organization but a trade organization."

The WTO is not a truly multilateral organization. It is a mechanism to 
perpetuate the US-EU condominium in the global economy.

Third, global civil society was a major player in Cancun. Since Seattle, 
the interaction between civil society and governments on trade issues has 
intensified. Non-governmental organizations have assisted developing 
country governments in the political and technical aspects of negotiations. 
They have mobilized international public opinion against the retrograde 
stands of rich country governments, as in the drug patents and public 
health issue. They have emerged as strong domestic coalitions that put 
their governments' feet to the fire to stiffen them against any further 
concessions to the rich countries. If many developing country governments 
resisted pressure from the US and the EU in Cancun, it was because they 
feared political retribution from civil society groups back home.

With peoples' movements marching in the city center and NGO's demonstrating 
hourly inside and outside the convention hall from the opening session on, 
Cancun became a microcosm of the global dynamics of states and civil 
society. The suicide of Korean farmer Lee Kyung Hae at the police 
barricades warned everyone at the convention center that they could no 
longer take the plight of the world's small farmers for granted, and this 
was acknowledged by the governments with the one-minute moment of silence 
they observed in his memory. Truly, the collapse of the Cancun ministerial 
was another confirmation of the New York Times' observation that global 
civil society is the world's second superpower.

Fourth, the Group of 21 is a significant new development that could 
contribute to altering the global balance of forces. Led by Brazil, India, 
China, and South Africa, the new grouping stalemated the EU and US drive to 
make Cancun one more sad episode in the history of underdevelopment. The 
potential of this group was indicated by Celso Amorin, the Brazilian Trade 
Minister who has emerged as its spokesman, when he said that it represented 
over half the world's population and over 63 per cent of its farmers. 
Amorin reflected the stance and potential of the new formation in his 
address to the ministerial: "We stand united, we will remain united. We 
sincerely hope that others will hear our message and, instead of 
confronting us or trying to divide us, will join forces in our endeavour to 
inject new life into the multilateral trading system. To bring it closer to 
the needs and aspirations of those who have been at its marginsindeed the 
vast majoritythose who have not had the chance to reap the fruit of their 
toils. It is high time to change this reality. This should be the spirit of 
Cancun."

Not surprisingly, US trade negotiators saw the Group of 21 as representing 
a resumption of the South's push for a "new international economic order" 
in the 1970's.

However, much lies in the realm of possibility, and the potential of this 
new formation must not be overestimated. It is now mainly an alliance 
focused on radically reducing the subsidies of northern agriculture. And it 
still has to meaningfully address the desire for comprehensive protection 
of smaller farmers in the smaller countries that are mainly focused on 
production for the domestic production. The reservations of some of the 
smaller countries is understandable since the Group of 21's most vocal 
members are large agro-exporters, though most have significant 
domestic-market-oriented, peasant based production as well.

Nevertheless, there is no reason that a positive agenda of 
small-farmer-oriented sustainable agriculture cannot be placed at the 
center of the group's advocacy. There is also no reason why the Group 
cannot extend its mandate to forging a common program on industry and 
services as well. Even more exciting is the possibility that the Group of 
21 can serve as the engine of South-South cooperation that goes beyond 
trade to coordination of policies on investment, capital flows, industrial 
policy, social policy, environmental policy. Such forms of South-South 
cooperation centered on the priority of development over trade and markets 
provide the alternative to both the WTO and the bilateral free trade 
agreements now being pursued by the US and the EU.

In articulating its agenda, the Group of 21 will find a natural ally in 
global civil society. With the US and the EU determined to defend the 
status quo and with both seeking to sow divisions among governments in the 
group, this alliance with civil society must be moved from potential to 
reality as soon as possible. It will not be easy of course. Progressive 
civil society groupings may be comfortable dealing with the Brazilian 
government headed by the Workers' Party, but they will be ill at ease with 
the Indian government, which is fundamentalist and neo-liberal or 
free-market oriented, and with the Chinese government, which is 
authoritarian and tilting towards neo-liberalism. Nevertheless, alliances 
are forged in practice and no government must be automatically categorized 
as impossible to win over to the side of people-oriented sustainable 
development.

To conclude, shortly after the Doha Ministerial, a number of civil society 
organizations said that the interests of the developing world would be best 
served by derailing the coming ministerial in Cancun instead of trying to 
convert the ministerial into a forum for reforming the WTO. As Cancun 
approached, the intransigence of the powerful countries stalemated 
discussions with the South on almost all fronts. By the time Cancun came 
around, there was no more talk of reform. Things had become crystal clear. 
With the EU and US determined to get their way, no agreement was better 
than a bad agreement, a failed ministerial was better than a successful one 
that merely served as one more nail in the coffin of underdevelopment.

After Cancun, the challenge for global civil society is to redouble its 
efforts to dismantle the structures of inequality and to push for 
alternative arrangements of global economic cooperation that would truly 
advance the interests of the poor, the marginalized, and the disempowered.

Can't Buy the World

But the opponents of doctrinaire liberalization and corporate-driven 
globalization do deserve a brief pause to celebrate the collapse of the 
Fifth Ministerial. Perhaps they might want to sing the adaptation of the 
Beatles' "Can't Buy Me Love" that their comrades at the ground floor of the 
convention center in Cancun belted out upon hearing of the breakdown of the 
negotiations:

Our world is not for sale, my friend

Just to keep you satisfied.

You say you'll bring us health and wealth

Well we know that you just lied.

We don't care too much for Zoellick

Zoellick can't buy the world.

Can't buy the wo-orld, listen while we tell you so

Can't buy the wo-orld, no no nooo!

No new issues in Cancun

You know that's just not right.

No arm-twisting delegates

Or Green Rooms through the night.

We don't care too much for bullies

Business can't rule the world.

Can't rule the wo-orld, listen while we tell you so

Can't rule the wo-orld no no nooo!~!


*Professor of sociology and public administration at the University of the 
Philippines and executive director of the Bangkok-based research and 
advocacy organization Focus on the Global South.

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Matthias Reichl
Begegnungszentrum für aktive Gewaltlosigkeit
Wolfgangerstr.26
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Tel. +43-6132-24590
e-mail: mareichl at ping.at
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