19 September 2005
Contents:
- Invitation to join AFTINET discussion e-list
- Parliamentary review of US and Singapore trade agreements
gives lie to claims of economic success
- No easy ride in the land of the FTA, The Age
- Update on Senate Inquiry on Australia’s relationship
with China
- Civil Society Declaration on the G20 Ministerial Meeting in
Pakistan
- Canadian groups launch appeal on the constitutionality of
the North American Free Trade Agreement (NAFTA)
- Inquiry on Corporate Accountability
- Conference - Piecing the Puzzle on trade and aid in the
Pacific: 20 – 21 October, Sydney
1. Invitation to join AFTINET discussion e-list
AFTINET is reviving a discussion email list on trade campaigning in
Australia. This e-list is for people who want a higher volume of information and for
people who want to contribute to discussions on trade campaigns. If you want to join this
discussion e-list, please contact Jemma on jbailey@piac.asn.au.
AFTINET will continue to provide regular summaries of trade justice
issues through our bulletins and website.
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2. Parliamentary review of US and Singapore trade
agreements gives lie to claims of free trade success
The Parliamentary Joint Standing Committee on Foreign Affairs,
Defence and Trade is currently conducting a review on the operation of free trade
agreements with the US, Thailand and Singapore. The Committee held public hearings on
Friday 19 August, mainly with representatives from government and industry. The transcript
of these hearings revealed some interesting results – namely that Australian exports
to both the US and Singapore have actually fallen since the FTAs came into force in
January 2005. The hearings also revealed that a number of industry representatives echoed
AFTINET’s criticisms about the government’s economic modeling prior to the
signing of FTAs – namely that the modeling is misleading as it is based on
unrealistic assumptions that overestimate the expected gains from signing an FTA.
The full transcript of the hearings is available at http://www.aph.gov.au/house/committee/jfadt/ftas/hearings.htm.
We understand that the report will be tabled in parliament on 31 October.
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3. No easy ride in the land of the FTA
The Age, 20 August 2005, Tim Colebatch
It was meant to be the big breakthrough for Australian exporters –
but official statistics show Australia's exports to the US have fallen by 3 per cent since
the start of the US free trade agreement. In contrast, the first six months of our FTA
with Thailand saw Australian exports surge 63 per cent.
With record commodity prices lifting Australia's export earnings by 16
per cent this year, and an agreement that was meant to let us "dock into the world's
most dynamic economy", why have exports to the US gone backwards?
It is not the first FTA that has failed to deliver. In the two years of
Australia's agreement with Singapore, exports there have slumped by 28 per cent. Yet
Singapore's exports to Australia have shot up 67 per cent in that time. A trade surplus of
$289 million in 2002-03 turned into a deficit of almost $4 billion in 2004-05.
The figures made for uncomfortable questioning yesterday at a
parliamentary committee hearing, particularly when Austrade and the Department of Foreign
Affairs and Trade sent along senior managers rather than trade analysts to explain them.
Labor members of the Joint Committee on Foreign Affairs, Defence and Trade zeroed in on
the failure so far of the Singapore and US deals, while officials tried to spin out of
trouble with a wealth of hypotheses.
Officials said it was "still early days" with the US free
trade agreement, which took effect on January 1, and we should not expect results yet.
"Our exports to the US have been in gentle decline since 2001," said Jeannie
Henderson, director of the US/Canada desk. (They have fallen by 22 per cent, or $2.75
billion.) She blamed the slump largely on the rise of the Aussie dollar, and said the
Government was "very confident" that, over time, the FTA would help reverse the
trend. "The United States market is extremely large and complex," she said.
"It takes a while to work our way in."
But the official study last year of the Australia-US deal predicted it
would lift exports this year by $1 billion, implying a rise of 10 per cent. US exports to
Australia have risen 7.4 per cent so far this year, roughly in line with the study's
estimate. Surging gold and oil exports dominated export growth to Thailand, along with
aluminium (up 53 per cent), cars and parts (27 per cent) and pharmaceuticals (19 per
cent).
Our exports some sizzle, some fizz
New Zealand: the Tasman shrank
1983-05: Our exports to NZ, up 10 per cent a year. To the world, up 8
per cent.
Singapore: no gain here
2003-05: To Singapore, down 15 per cent a year. To the world, up 5 per
cent.
Thailand: Aussie invasion
January-June 2005: To Thailand: up 63 per cent. To the world, up 16 per
cent.
US: where's the beef?
January-June 2005: To the US, down 3 per cent. To the world, up 16 per
cent.
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4. Update on Senate Inquiry on Australia’s
relationship with China
As reported in previous AFTINET bulletins, there is a current Senate
Inquiry into Australia’s relationship with China. AFTINET made a submission to this
Inquiry and gave evidence at public hearings. Many AFTINET members also made submissions
to this Inquiry. The Inquiry was meant to report on 15 September. This date has now been
postponed to 10 November.
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5. Civil Society Declaration on the G20 Ministerial
Meeting in Pakistan
There was a meeting of the G20 in Pakistan from 8 – 10 September.
The G20 is the coalition of 20 developing countries that threw a spanner in the
works on the issue of agriculture at the WTO Ministerial in Cancun in 2003.
The G20 represents developing country interests and plays an important role as a
counter-power to the EU and the US. Community groups are concerned that the G20 will
fracture under pressure from developed countries in the lead-up to the WTO Ministerial in
Hong Kong in December and will accept a deal that may harm the interests of
least-developed countries and access to food in developing countries.
Civil society groups from across Asia met in Pakistan during the G20
meeting to urge the G20 not to accept a WTO deal that may harm food security and
least-developed nations. A summary of the civil society declaration follows:
- Aware that the G-20 has emerged as an influential group within the WTO and the emergence
of the G-20 has raised the hopes for a better deal for the Third World;
- Aware that since there was no first approximation in July 2005, the rich countries and
forces within WTO would certainly rush to achieve the first approximation in October
General Council and a successive agreement in Hong Kong;
- Aware that there will be a new wave of informal, exclusive and non-transparent meetings
in and outside the WTO.
- Aware that such practices would undermine the capacity of poor countries to fully engage
in the negotiation process;
- Aware that consumers in the developing countries lose as a result of trade practices
such as subsidized dumping by Northern producers which causes immense turbulence in
Southern food markets and undermines local food production;
- Aware that WTO policies also harm the non-farming indigenous communities which still
depend on commons, pastures, forests and natural waters for their livelihoods and
cultures. The WTO-backed extended agriculture in fact encroaches upon the livelihoods of
these communities like Kihals (riverine community) and Musalis (desert community) in
Pakistan;
We recognise that Agreement on the Agriculture (AoA) has two
fundamental problems. First, it does not differentiate between the structural
characteristics of the agriculture system of rich countries and that of the poor countries
despite significant differences between the two. For instance, majority of population in
poor countries (70%) is engaged in agriculture as against only 3% in rich countries.
Majority of the poor countries have subsistence agriculture system compare to the
commercial and market oriented agriculture system in rich countries. Second, it
contains implementations related loopholes that enabled rich countries to increase the
subsidies by 9 percent after 1995 instead of reduction in subsidies.
We therefore believe that poor countries should avail this opportunity
of AoA Review to rectify and overcome these fundamental problems. We accordingly
urge the G20 to reject the current WTO negotiations package. We urge the G-20
to categorically reject the current anti-development package and to undertake necessary
efforts to bring a TRUE DEVELOPMENT agenda on the negotiation table that must include the
following:
- Immediate end of trade distorting domestic subsidies
- Immediate end of export subsidies and export credits in a way that the national reform
programs in the rich countries do not impede the elimination of export subsidies
- A substantial numbers of special products and special safeguard mechanisms to be treated
according to the situation of the respective poor countries
- Green box review to eliminate all trade distorting parts of subsidies
- Elimination of blue box
- Elimination of tariff peaks and tariff escalation
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6. Canadian groups launch an appeal on the
constitutionality of the North American Free Trade Agreement (NAFTA)
On 12 August, the Council of Canadians and Canadian Union of Postal
Workers (CUPW) filed to appeal a Canadian Court decision concerning the constitutionality
of NAFTA investment rules. The groups had asked the Court to declare the private
enforcement of NAFTA’s investment rules unconstitutional because it undermines the
role of Canadian courts and offends both the Charter of Rights and Freedoms and the Bill
of Rights.
Under Chapter 11 of NAFTA, foreign corporations can sue the federal
government for compensation where legislation, policy or even the delivery of public
services interferes with present of future profits. "We believe that legal disputes
between individual corporations and the state, impacting on a wide range of legislation
and public policy, cannot be placed beyond the reach of the Constitution and
Charter," said trade lawyer Steven Shrybman. "NAFTA tribunals are not competent
to apply Canadian law or legal principles, such as fundamental justice and equality."
CUPW and the Council of Canadians launched their court case against
NAFTA in 2001 in response to the United Parcel Service's (UPS) lawsuit against Canada. UPS
is suing Canada for $160 million USD in damages under NAFTA arguing that our publicly
funded network of mailboxes and post offices gives Canada Post an unfair advantage when
delivering courier services that are in competition with private courier services.
"A win for UPS would cost taxpayers millions and undermine their
public postal service, said CUPW National President Deborah Bourque. "What's more,
the suit launched by UPS could just as easily be over public education or health care.
Most crown corporations and public agencies deliver some services that are in competition
with the private sector."
Investment provisions like Chapter 11 should be removed form NAFTA and
other trade agreements signed by Canada," said Jean-Yves LeFort of the Council of
Canadians. "The willingness of our government to submit to these rules reflects an
overwhelming concern for the commercial interest of foreign corporations at the expense of
the public interest."
The groups are appealing the decision to the Ontario Superior Court of
Appeal and expect the case to be heard later this year or early 2006.
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7. Inquiry into Corporate Accountability
The Parliamentary Joint Committee on Corporations and Financial
Services has announced an Inquiry into Corporate Responsibility. This inquiry will look at
the social and environmental impacts of corporations and whether the current legal
framework is sufficient to regulate corporations and directors.
The Committee is calling for public submissions on this issue by 30
September. The terms of reference and further information can be found at http://www.aph.gov.au/Senate/committee/corporations_ctte/corporate_responsibility/index.htm.
lease consider making a submission to this inquiry. Some points that
you could make are:
- Corporations are powerful players and their decisions impact the broader community and
the environment. Corporations should therefore be bound to have regard for human rights,
workers rights and the environment and should be legally accountable to the community.
- The existing legal framework in not sufficient to regulate corporations. Corporate
directors are not allowed to take account of broader social responsibilities, where they
conflict with shareholders’ financial interests. The law on directors’ duties
should be changed to make directors consider the social and environmental impacts of their
decisions.
- There has been a large increase in ‘corporate social responsibility’
initiatives. Unfortunately most of these, at a national and international level, are
voluntary and rely on the good faith and honesty of the corporation. Any reporting
initiatives or guidelines should be mandatory, should be independently audited and should
impose penalties if corporations do not comply.
Please send submissions to corporations.joint@aph.gov.au or
Committee Secretary
Joint Committee on Corporations and Financial Services
Department of the Senate, Parliament House
Canberra ACT 2600
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8. Conference - Piecing the Puzzle on trade and aid
in the Pacific: 19 – 20 October, Sydney
You are invited to a one and a half day seminar with leading
Australian campaigners looking at aid and trade policy in the Pacific region. The seminar
will be held on 20 – 21 October at the Y Hotel in Sydney. Cost is $100 (full price);
$50 (concession). For more information or to RSVP, please contact Kate Walsh at aidwatch@aidwatch.org.au or Jemma Bailey at jbailey@piac.asn.au.
The seminar aims to explore the new and emerging issues within this
debate and provide an opportunity for participants to share information on their current
focus. This in turn will provide a forum for campaigners, academics and communities to
jointly strategise and network.
