1. Sydney Cancun report back seminar
2. W(h)ither the WTO after Cancun?
3. Trade Officials Poll Reveals Little Hope For Quick Progress in Doha Round Talks
4. Members of Parliament Hail Kenyan Trade Minister for Leading WTO Walkout

1. Sydney Cancun report back seminar

Sydney report back seminar 14 October 5.30 pm, Parliament House

Reports from the World Trade Organisation meeting in Cancun

Why did the WTO Ministerial Conference in Mexico collapse? What does this mean for the future of the WTO, and for the future of international trade? Find out at this public seminar.

When: Tuesday 14 October, 5.30 pm

Where: Room 814 Parliament House, Macquarie St, Sydney

Chair: Andrea Durbach, Director, Public Interest Advocacy Centre

Speakers:

Jeff Atkinson, Advocacy Coordinator, Oxfam Community Aid Abroad and

Dr Patricia Ranald, Principal Policy Officer, Public Interest Advocacy Centre, and Convenor, Australian Fair Trade and Investment Network

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2. W(h)ither the WTO after Cancun?
by Dr Patricia Ranald, AFTINET Convenor

The Cancun hotel zone, site of the WTO Ministerial Meeting is a surreal place which mirrors in many ways the inequalities of world trade. Twenty kilometres of luxuriously expensive high rise hotels dominate a beautiful beach. No ordinary Mexicans live there. The hotel workers, whose daily wage would barely buy a cocktail in the dollar economy of the zone, travel by bus from Cancun city ten kilometres away. Huge steel barriers and massive numbers of police and military protected the meeting from demonstrations.

Limited numbers of accredited community representatives were permitted into the zone, with much greater numbers of business organisations. There was a coordinated "inside and outside" strategy by community organisations, organised by global networks like the Our World is Not for Sale Network. As the official government delegates negotiated behind closed doors, community organisations lobbied and held peaceful symbolic protests and media events in the conference centre. Thousands more, led by Mexican groups, held seminars, concerts and marches in Cancun city. I spoke about the US Australia Free Trade Agreement at a seminar of 200 people on bilateral agreements. AFTINET and other community organisations lobbied the Australian government delegation and briefed the media. AFTINET was interviewed on ABC Radio National PM, Life Matters and Bush Telegraph, and SBS TV News.

Lee Kyung-hae, former leader of a South Korean farmers organisation, climbed the steel barrier during the first march and stabbed himself in protest at the effect of WTO polices on traditional farmers. Like many farmers in developing countries, he and his neighbours had been ruined by subsidised imports. Self immolation is the strongest protest that can be made in Korean culture. Mr Lee did not give any warning of his protest, which shocked both activists and conference delegates. Memorials commemorating his sacrifice were held at the barrier and inside the conference centre. At the final march, indigenous women symbolically cut the steel wires, the barriers were pulled down and there was a final peaceful memorial service.

Two issues dominated the meeting. Developing countries demanded that the WTO fulfil the "Doha development agenda" commitment to end unfair WTO rules on agriculture. These rules had forced them to lower tariffs and open their markets to imports while still permitting farm subsidies in the EU and USA. Small farmers have been ruined and food security is threatened by cheap subsidised imports.

But it was the insistence of the EU, with support from the US and Japan, on new WTO agreements on investment, competition policy, and government procurement, which led to the collapse of the meeting. Over 90 developing countries said no to such agreements because they would reduce their sovereignty and options for local development, by requiring foreign investment to be treated as if it were local investment. Governments could not then require foreign investors to develop relationships with local firms, to transfer skills and technology or to use local products. These are all standard strategies to ensure that foreign investment contributes to local development, and most governments want to keep them.

Power shift in the WTO: the role of the G22 and the Afro-Caribbean Group

The role of the G22 group of developing country governments, led by Brazil, China, India, Argentina and South Africa, was a key shift in power relations in the WTO. They declared that they represented the majority of the world's peoples and of the world's farmers. They rejected the draft meeting statement and put forward their own proposals to reduce unfair export subsidies in industrialised countries and to address the food security and rural development needs of developing countries. They also resisted WTO agreements on the new issues. The group stood firm despite extreme pressure, including personal calls to heads of state by George Bush.

The Indian and Brazilian governments met with civil society groups, and asked for their support. However the content of their proposals remained broadly within the parameters of the WTO framework of emphasis on agriculture as an export industry.

The larger group of over 70 African and Caribbean countries also strongly opposed the new issues and wanted more detailed measures on food security and development. They supported a proposal by Burkino Faso for cotton producing countries which demanded an end to US cotton subsidies and demanded compensation to African countries for the damage they had caused. The rejection of this proposal by the US reinforced the stance of this group.

Small farmers' organisations like Via Campesina and the Korean farmers' organisations supported from the"outside" the power shift represented by the G22 and the African and Caribbean countries. But their demands were more radical: that the WTO rules kill farmers and that agriculture should not be treated as an export commodity under WTO rules. They support an end to export subsidies which benefit large agribusiness, but want governments to support small farmers to assist domestic production.

Australia's role

The Australian position, as leader of the Cairns group of agricultural exporting nations, was sidelined when over half of the Cairns group joined the G22. Australia supported the G22 call for an end to agricultural subsidies, but did not support developing countries in their opposition to the "new issues". Nor did it support their calls for differential treatment on food security and rural development. The Cairns group and Australia's role in it has probably suffered permanent damage because of this failure to support the demands of developing countries. The Australian government should reassess its position and should the support developing countries on food security, rural development and opposition to new WTO agreements.

As Nobel Prize economist Joseph Stiglitz wrote in the Guardian on October 2, "The failed WTO meeting in Cancun should serve as a warning: something is fundamentally wrong with how the global trading system is managed."

The Cancun collapse four years after Seattle shows that the WTO is still in crisis because of its secretive process dominated by the powerful economies, failure to meet the needs of developing countries and failure to acknowledge growing global poverty and environmental destruction. The domination of the richest industrialised countries has been challenged by a coalition of developing countries, supported by global networks of civil society organisations. This coalition can no longer be ignored. Commentators like UN secretary General Kofi Annan and even editorials in the New York Times and the Australian Financial Review have acknowledged these issues.

The EU is now defensively claiming that it offered a last minute compromise to drop two of the new issues. This opens the way for a strong campaign to withdraw all the new issues from the WTO agenda once and for all.

US Trade representative Zoellick appears to have learnt nothing from the experience of Cancun. His article in the Financial Times of September 22 arrogantly blamed the G22 for "a culture of protest" and fostering North/South divisions, while ignoring the real basis for these divisions. He threatened to move to exclusive trade agreements with "can do" countries.

The US is still trying to split the G22 by threatening to withdraw aid and trade preferences with particular pressure on Costa Rica, Columbia and Peru. The US agenda for regional and bilateral agreements contains all of the new issues and all of the GATS agenda and offer nothing on agricultural subsidies, which cannot be dealt with on a bilateral basis. A Coalition of business groups wrote a letter to Zoellick on September 23 insisting that the Free Trade Agreement of the Americas contains the same draconian investment rules as NAFTA, the US/Chile and US/Singapore agreements. The letter said "…we strongly oppose...attempts by some US trading partners in the region to forge a more limited trade agreement by leaving several difficult but highly important issues off the negotiating table." This is clearly an attempt to intimidate Brazil and other countries into accepting the draconian NAFTA rules. However this strategy could backfire as Brazil is the largest of the Latin American economies and can initiate regional trade arrangements on terms which are more favourable to those countries.

This US strategy confirms that that US/Australia FTA is about imposing a US model rather than delivering benefits for Australia.

The strength of the G22 is that it contains the largest developing countries which are not so easily intimidated. While the US and EU are now on the back foot, the G22 are already meeting in Geneva and are developing their proposals on agriculture.

AFTINET and other civil society groups will continue to campaign against this model and for fairer multilateral trade rules which will restrain the domination of the most powerful economies and corporations and advance the human rights of the majority of the world's peoples. This would require a fundamental transformation of the WTO, or the development of new institutions which can meet these challenges.

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3. Trade Officials Poll Reveals Little Hope For Quick Progress in Doha Round Talks

Summarised from BNA WTO Reporter, Tuesday, October 7, 2003, by Daniel Puzin.

GENEVA--Trade officials and trade experts believe there is little hope of putting the derailed Doha Round of trade talks back on track before the end of the year and that hopes of finishing the round by the prescribed January 1 2005 deadline are now a pipe dream. , These are the results of a poll of 100 negotiators and experts carried out by an the Adelaide based research institute, International Business, Economics and Law, (IIBEL) headed by Andrew Stoler, former deputy chief of the U.S. trade mission in Geneva and former WTO deputy director-general.

After the meeting collapsed over the Singapore issues, ministers issued a declaration calling for a meeting of the WTO's General Council to be convened at senior officials level no later than December 15 "to take the action necessary at that stage to enable us to move towards a successful and timely conclusion of the negotiations."

However, the survey revealed that few are optimistic that any decisive action will take place before the end of the year. "Overall, just 34 percent of respondents believe there are good prospects for breathing life into the round by December, 46 percent are doubtful, and the remaining 20 percent give success a 50-50 chance," IIBEL noted.

An overwhelming majority of those surveyed believed the January 1 2005 deadline for completing the round was no longer realistic in light of the debacle in Cancun.

Nearly three quarters of those surveyed said the negotiations need to re-focus on the contentious issue of agriculture as part of an effective post-Cancun strategy. In contrast, nearly the same percentage now consider the Singapore issues of investment and competition policy should be definitively removed from the Doha agenda in light of the European Union's last-minute concession in Cancun to drop its demand for WTO negotiations in these sectors. The survey did not indicate whether those polled also believed the other two Singapore issues, trade facilitation and transparency in government procurement, should also be taken off the Doha agenda.

As for who was to blame for the Cancun setback, a large majority (63 percent) agreed with Minister Derbez's decision to end the meeting when he did.

G-21 Contribution Seen as Positive

The respondents were also reluctant to follow the lead of top U.S. and EU trade officials in blaming the G-21 group of developing countries for contributing to the failure of Cancun. "Overall, those who thought the G-21 made a positive contribution are in the plurality (48 percent), with 28 percent holding the contrary view," the institute noted.

IIBEL added that a "fair number of respondents included supplemental views in their response to the effect that they believed the United States misread the strategy and intentions of the G-21 and that this American hostility undercut the chances for the group to make a positive contribution."

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4. Members of Parliament Hail Kenyan Trade Minister for Leading WTO Walkout

Summarised from The East African Standard (Nairobi) October 2, 2003

Legislators from both sides of Kenya’s House demanded the withdrawal of the pending Public Procurement and the Privatisation Bills saying they had been imposed on the country by foreigners.

The legislators, at the same time, hailed Trade and Industry Minister Dr Mukhisa Kituyi for the manner in which he led the Kenyan delegation to the recent World Trade Organisation (WTO) meeting in Cancun, Mexico.

They said Kituyi's action was justified in leading the African nations in a walkout at the Cancun talks over the developed nation's failure to do away with agricultural subsidies, The remarks arose after Kituyi stood to give a ministerial statement on the WTO meeting and update the House on the progress so far.

He said the Procurement Bill pending before the House "is more harsh than the conditions Kenya was subjected to at the Cancun meeting."

Kituyi said the Kenyan delegation further mobilised other African countries to oppose discussion on the universality of tenders and procurement, which the meeting wanted agreed upon. Other issues discussed, he said, included the trade and investments policy, and provision of generics to poor nations, especially for malaria and Aids. "Kenya stood its ground as we believed the national interests superseded the international ones," said Kituyi.

Kaiti MP Gideon Ndambuki (Kanu) sought to know what the Government now intends to do with the Procurement Bill. Ndambuki also sought to know whether the rejection of the Bill would lead to harassment of Kenya by donor countries. He said a European Union delegation that recently visited the country had been quoted as saying Kenya had no choice but to embrace the Cancun resolutions.

Imenti Central MP Kirugi M'mukindia, while congratulating Kituyi on his actions in Mexico, demanded that the Bill be withdrawn for reconsideration on what Kenya, and not the international market, want. He also sought to know what the minister was doing about the EU and the US who for "attempting to armtwist the country".

Kathiani MP Peter Kaindi (Narc) too congratulated Kituyi and added that the two bills must be looked at afresh and before being debated in Parliament. Kituyi received more praise from Shadow Finance minister Billow Kerrow, who urged him to ensure he brought all binding trade agreements and treaties to the House before they were signed.

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