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AFTINET Bulletin No. 152
would like to contribute to the Bulletin, please contact us at email@example.com
or Phone (02) 9212 7242 Fax (02) 9211 1407
Previous AFTINET Bulletins
and resources are available at www.aftinet.org.au.
- 1. Winning or playing fair in
- 2. Wall St
Bailout wont do much to help ailing economy
- 3. World Trade
- 4. Free Trade
- 5. Pacific
Calling for Climate Justice, October 25
- 6. AFTINET AGM
- 7. Call to Support Columbian
Sugar Workers Strike
- 8. Aid/Watch
Fundraising Film Night, The Fight for Land Rights, October 30
1. Winning or playing fair
in World Markets?
When I was an aspiring
soccer star in the Under 7 Seagulls we were constantly told that it doesnt
matter if you win or lose, its how you play the game. I wonder what my coach
would say about the contest of international trade. The Winning in World
Markets review of Australias trade programs was released this week offering
nothing other than advice on how we can win the trade game.
The review, conducted by
David Mortimer, was given the brief to look at Australias current trade programs and
policies and report back on whats working and what isnt. Generally speaking
the review repeats the same old calls from business: less regulation,
better support for exporters, and more access to foreign markets.
Missing in the report though is any hint of irony at the free market ideology that drives
business to ask for more and more support from government to do business.
According to the review,
Australias game plan for victory focuses on our innovation and competitiveness. Much
of the focus on how Australia can better compete in the world market comes down to how we
can better produce and innovate in Australia. Building better infrastructure is seen as
key to this, not just the physical expansion of ports, railways etc, but the skills
infrastructure too. Better education and training programs are indeed a good idea, but
they cannot simply be a system to produce meal tickets for people. Education after all
does have a public good and isnt only for getting jobs in the export sector.
bilateral trade agreements were given special mention in the review. After all, we need to
know if theyre working. The results were
inconclusive. Of course the worsening
trade balance and mixed comments from exporters were simply explained away due to the
agreements only being in place for a few years and perhaps not enough liberalisation has
occurred. Thats right, perhaps liberalisation isnt working because
theres not enough of it. I mean, the theory of it works, its just an issue of
In response to this
assessment, the review has staked out investment and trade-in-services as the goal scoring
opportunity to pull Australia out of our negative trade balance. Of course to do this we
need to get rid of all those pesky regulations in foreign countries such as screening of
investments, minimum local content, and foreign ownership limits. All those tools that
allow governments to ensure that investment and services are of benefit to the population
are barriers to trade, and when its our trade, thats a problem.
Of course though,
were not so rude as to demand that countries undo such regulations straight away.
Thats why the review has recommended the use of more subtle tools such as
collaboration and enhanced economic integration. Like the recent
trade agreement between Australia, the Association of South East Asian Nations and New
Zealand, the Economic Cooperation chapter was aimed to help those nations
integrate more with the free trade program. Through cooperation, theyll be more
ready for our trade.
Despite all this concern
with bilateral trading, the review realised that its the multilateral arena
thats the main game. The recent collapse of the World Trade Organisation talks, the
4th time its happened, led the review to agree with the Warwick Commissions
recommendations for the WTO.
One of these focussed on
the decision making structure of the WTO. Currently its a consensus procedure where
everyone has to agree to all aspects of any agreement. This, to the frustration of many
rich countries, has given the poorer countries a chance to refuse a
development round that actually does nothing of the sort. What team would
agree to kicking an own goal? Clearly this veto power is unacceptable, but what could work
is a critical mass approach. That is, once there is agreement in somewhat of a
majority in a negotiation area - its agreed. In this situation, its a case of
changing the rules in order to win.
The other solution to
getting more out of the multilateral system is the use of disputes settlement. Through
this process we can take countries to the WTO trade tribunal to challenge aspects of their
regulations or levels of domestic support, and if we win, make them change or pay up. This
has already happened in Australia with a challenge on imports of live salmon overturning
our quarantine standards, and now were back at the WTO trade tribunal over imports
of New Zealand apples.
The review went to the
extent of following the Warwick Commissions recommendations for the WTO to undertake
a reflective exercise on the future of world trade. Sadly they didnt accept all of
that recommendation, which suggested the WTO address the relationship between current
trade rules and fairness, justice and development.
This Winning in
World Markets review has reaffirmed the basic tenant of Australian sport - its
ok to focus solely only on winning, so long as were the ones that do. No one likes a
self obsessed, arrogant sports team unless its theirs, and it seems that attitude is
the same for trade. The review misses the wider concerns that were expressed to it, that
is, trade has social, environmental, and cultural impacts that we need to address.
The ALP went to the last
election saying they would conduct independent assessments of these impacts. So far,
nothing. This review further reinforces the blind faith that the economy operates in a
bubble. It doesnt matter if were exacerbating climate change or undermining
job security or restricting the right of governments to regulate in the interest of the
public. As long as were winning, it doesnt matter how we play.
We can change what it
means to win though. We can build a trade focus that supports both economic development
and protects labour, human and environmental rights. It isnt a trade off, and
were under estimating our ability if we think thats the case.
If this review was an
under seven Seagull, it wouldnt get any oranges at half time. Thankfully
theres still ample time to play the trade game, and we can play it on the terms we
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2. Wall Street Bailout Won't Do Much
to Help Ailing Economy
By Mark Weisbrot
Centre for Economic and
It is now clear the
approval by Congress of President Bush's $700 billion bailout package on Friday October
3rd has done nothing to ease the current financial crisis. Credit markets have worsened
for several days after the bill passed the Congress. The stock market also plummeted to
nearly ten-year lows.
So much for dire
warnings from the Bush Administration that Congress was risking a Great Depression if it
did not quickly fork over the dough. The bailout's supporters said Congress had to do
something to unfreeze the credit markets. It didn't work.
There is a basic
misunderstanding of the current financial crisis and economic recession that is
widespread. Most people think that the current economic downturn - which will be
officially designated a recession some time in the near future - is the result of the
financial crisis. But this is not true. The current recession is mainly the result of a
collapsing housing bubble. This bubble of more than $8 trillion dollars accumulated
between 1996-2006, and it is only about 60 percent deflated so far. This means that even
if all the problems in the financial system were miraculously solved tomorrow, the United
States would still be facing a serious recession.
Of course the financial
crisis can make this worse, as financial institutions cut back on lending and short-term
interest rates for commercial borrowing rise. And we are indeed facing a serious financial
crisis. But the bailout package is a wasteful and inefficient way of dealing with the
problem of banks holding bad debt, mostly related to mortgages gone sour in the housing
bust. It enables the U.S. Treasury Department to buy up "troubled assets" -
mostly mortgage-related securities - from financial institutions, at prices that will
likely be much higher than they are worth.
Economists across the
political spectrum saw this as a wasteful and inefficient way to fill holes in banks'
balance sheets. Ordinary citizens and taxpayers saw the bailout as an enormous rip-off,
and flooded Congress with phone calls, defeating the bailout on its first vote.
Indeed, the most
important ways that our government is currently holding the financial crisis in check do
not involve overpaying banks for bad assets. The Federal Reserve and U.S. Treasury have
intervened repeatedly to pour liquidity into the banking system. They have agreed to
federally insure $3.4 trillion of money market mutual funds held by millions of Americans.
This week the Fed created a new facility to buy commercial paper, the short-term debt
issued by banks and corporations, where lending has been shrinking. The Federal takeover
of Fannie Mae and Freddie Mac, and the nation's largest insurer, were also necessary to
preserve the stability of the financial system.
All this is just the
beginning of cleaning up the mess that has resulted from a de-regulated and un-regulated
financial system gone wild. The government will have to take over more insolvent financial
institutions and provide capital to others. It will have to take steps to help homeowners,
to minimize foreclosures and evictions. And it will need to provide the largest fiscal
stimulus package since the Great Depression, to prevent this recession from dragging on
for years. The worst part about the bailout is that some politicians will say we can't
afford the necessary stimulus because we just added $700 billion to the national debt.
Americans will have to
fight for measures that protect the public interest, not the interests of those who made
this mess. Treasury Secretary Henry Paulson made $163 million as CEO of Goldman Sachs in
2006. Now he and his former colleagues at Goldman are running the Wall Street bailout.
During the Asian
financial crisis ten years ago, there was an expression for this kind of system:
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3. WTO Update
There has been a slow
resumption in talks at the WTO following the collapse in negotiations in July. The G7
countries have meet informally to discuss one cause of the collapse, the Special Safeguard
Mechanism, specifically in regards to a new proposal submitted by Australia and Brazil.
This proposal was to include natural growth as a factor into the trigger of the mechanism,
that is, there will be a rise in imports due to natural growth of population/demand. The
G7 however made no progress with one diplomat saying that theres uncertainty as to
whether or not theyll meet again.
There has been movement
in the wider WTO to restart talks in agriculture and manufactured goods. The meetings that
have taken place so far have decided that the July drafts as submitted by the negotiating
chairs (as opposed to the controversial text by Director General Lamy) will be the basis
for ongoing negotiations. Whilst these texts are far from perfect, they are significantly
better than the Lamy text.
The upcoming US election
is leaving many negotiators unsure about just what can be agreed to. The Director General
Lamy has indicated that he is now trying to get modalities (negotiating guidelines) agreed
to by the end of the year. The perpetually rolling deadline of the WTO continues to
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4. FTA Update
The Australia Chile FTA
(ACl FTA) passed through the Joint Standing Committee on Treaties at the end of August.
Although it was only accorded 40 minutes to review the treaty, the Committee raised a
number of questions based on the submissions from AFTINET and its members.
Republic of Korea FTA
between Australia and the Republic of Korea have begun in Seoul. Trade Minister Crean has
highlighted that Australia will be targeting greater market access for beef, education and
tourism services. The talks for this FTA come on the back of major protests within Korea
arising from an FTA with the US that expanded to target the whole government.
With talks now entered
into their fourth year the latest round of negotiations took place in late September and
focuses on services and investment. Australia once again pushed for greater access to
education as well as financial, telecommunication and legal services. Mining services and
investment were also raised as a priority area for Australia in the FTA.
China again raised
the issue of movement of natural persons as a key part of any agreement. Investment in Australia
was also raised, particularly the foreign investment screening regime and access of
Chinese mining investors to ports and infrastructure.
The next round of
negotiations will be held in December.
Trans Pacific Free Trade
This FTA is a
pluri-lateral set of negotiations that is being undertaken between NZ, Chile, Singapore, Brunei
and now the US. Australia is considering joining the negotiations. This FTA was
specifically mentioned in the Mortimer Review as an example of a pluri-lateral agreement
that Australia should be engaging in.
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5. Pacific Calling for
Climate Justice a human rights framework, October 25
The Pacific Calling
Partnership invites you to a participatory forum titled Pacific Calling for Climate
Justice a human rights framework?
9.00am - 5pm Saturday 25
Gleeson Auditorium Australian
25A Barker Rd
Following a beginning of
dance and song, the forum will open with Indigenous representatives from Australia and the
Pacific speaking about the effects of climate change on their people. The forum will then
explore how an effective human rights framework can respond to calls for climate justice
from our neighbours:
What structures are
currently available internationally that can be applied in our neighbourhood?
Where are the gaps?
Where are the stresses
What structures do we need
to put in place for the future?
Speakers include: Jenni Enosa from the Torres Strait, Claire Anterea
from Kiribati, Naomi Biribo from Kiribati,
Akii Neneia from Kiribati, Sulu Uotarom from Tuvalu, Neva Collings, Warwick Baird, Kirk Huffman, Damien
Lawson, Keely Boom, Alex Bathal.
Facilitator: Mark Raue
Special guest: Bonita
The forum will be
participatory and is open to as broad a range of organisations as possible. All who come will be contributing to the outcomes
which will include recommendations to be taken to the United Nations Framework Convention
on Climate Change in Poland in December 2008.
(includes lunch and morning tea)
Full cost: $60
To book a place contact
Jill Finnane on (02) 8762 4200 or firstname.lastname@example.org
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6. AFTINET AGM November 12
Sydney Mechanics School of the Arts
AFTINET is having its
Annual General Meeting on the 12th of November. This is a chance for members to
come along and hear about the work that AFTINET has done over the year, see what issues
are coming up for the year ahead, and elect the new working group.
The guest speaker this
year will be Diana Beaumont. Diana is an organizer with the Victorian branch of the
Textile, Clothing and Footwear Union of Australia (TCFUA). Prior to this, she spent two
years working in labour rights organizations in China - first with a grassroots workers'
rights centre in Shenzhen, and then later at the Asia Monitor Resource Centre in Hong Kong
(http://www.amrc.org.hk). She is also the co-ordinator of the China Labor News
Translations Project, a website and email bulletin providing English translations of
Chinese media articles, reports and blogs related to labour issues
A separate invitation
will be sent out soon to all members including campaigner reports, financial reports and
other information. The event details are:
Date: November 12, 6pm
Venue: Sydney Mechanics School
of the Arts, 280 Pitt St, Sydney
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7. Call to support
Columbian Sugar Workers Strike
7th October -
In Colombia, for the last 20 days between 12 000 and 18 000 men who work the cane fields
have been on strike. Their strike has stopped 80% of all production of sugar in Colombia
and it is estimated that it has cost the sugar sector around $450 million. In the words of one of the sugar cane workers, the
strike is a historic moment against the exploitation of 200 years of slavery. While their
abusive working conditions are not new, these men are supposedly now contracted legally
under what is known as a cooperative system. Introduced
in 2005 by the Uribe government, this system forms 102 cooperatives to which the workers
have to be affiliated in order to be employed.
The basic objective of
this system, which privileges a mercantilist contract, has been to relieve the company of
any responsibility they might have towards their workers. This has resulted in working
conditions that, amongst other injustices, impose 12-16 hour days that are paid in tonnage
cut rather than in hours worked, failure by the companies to cover health or occupational
costs of their workers, which means that annually 200 men are permanently incapacitated
and then denied a pension, a salary that does not meet their living costs and leaves them
unable to give their children education or pay their rent and the deterioration of
community as their land is appropriated by companies and they are forced into a waged
community must come to the aid of these workers urgently because their own government
denies them voice and suppresses action. The Uribe government has accused the workers as
being terrorists and delinquents because they are slowing down the development of their
country with their demands. The police patrol the various camps of those striking
threatening leaders and sowing fear amongst self-declared humble workers. Moreover, the strike is at crisis point because
these men support themselves and their families day by day. 20 days without pay means 20
days without money to buy food or pay their bills. Their fears are rising and they need to
hear the voices of the international community in:
· Support for their
cause, which is about human rights and justice;
· Pressuring the
Colombian government to recognize the rights of these workers - legislated in their own
Constitution rather than protect the interests of the land-owners who exploit them
· Donating financial
aid so that their families can buy rice that will fill their stomachs and give them the
necessary force and patience to win this fight
For further information:
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8. Aid/Watch Fundraising
Film Night, The Fight for Land Rights, October 30
AID/WATCH invites you to
a fundraising night of documentaries and speakers on grassroots struggle for land rights
in Cambodia, Mexico and Papua New Guinea.
AID/WATCH Director, Lara
Daley will speak on the importance of maintaining customary land systems to prevent
communities losing control of traditional lands. Documentary makers will be present for
discussion following the screenings.
AID/WATCH is a not-for
profit aid watchdog, dedicated to ensuring aid reaches the right people, communities and
When and Where: 6.30pm,
Thursday 30th of October, Mitchell Theater, Sydney Mechanics School of Arts, 280 Pitt
Street, Sydney CBD.
Cost: Concession $10/
Contact: 9557 8944 or
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