STWR - Share The World's Resources

The World Trade Organisation is unfit to address the needs of the world's poor. There should be no attempt to resuscitate the current global trade talks.

 

The freer movement of trade and capital has been a fundamental characteristic of the past 25 years of globalization. The Doha round, initiated in 2001, was the latest attempt to keep the process rolling. It now looks doomed. The deadlock between the US, the EU, Japan, and the developing countries seems final. And with the fast-track powers of the US president - which enable trade agreements to bypass Congress - scheduled to come to an end in 2007, any agreement later than this year will be subject to the unpredictability and delay of Capitol Hill. In other words, it is now or never, and it looks more and more like never.

The WTO is entering the last stages of talks to determine the rules of the global economy for the next 20 years. The developing world is set to suffer

So this is it. After five years of shadow boxing, the world is approaching the point of no return. This week the World Trade Organisation (WTO) is entering the last, crucial stages of talks to determine the rules of the global economy for the next 20 years. So how come so many of us are hoping it will fail?

The stakes could not be higher. As a result of intense negotiations over the next seven days, individual countries will be told how much they have to open their markets to external competition in the years ahead. For developing countries, this is a critical factor in their attempts to build sound economic bases for their future development. Exposing infant industries to premature competition from abroad threatens to wipe them out before they have had a chance to develop, while for the farmers of the Third World such competition can literally mean life or death.

The IMF’s meeting this spring was lauded as a breakthrough, with officials given a new mandate for “surveillance” of the trade imbalances that contribute significantly to global instability. The new mission is crucially important, both for the health of the global economy and the IMF’s own legitimacy. But is the Fund up to the job?

There is obviously something peculiar about a global financial system in which the richest country in the world, the United States, borrows more than $2 billion a day from poorer countries – even as it lectures them on principles of good governance and fiscal responsibility. So the stakes for the IMF, which is charged with ensuring global financial stability, are high: if other countries eventually lose confidence in an increasingly indebted US, the potential disturbances in the world’s financial markets would be massive.

The task facing the IMF is formidable. It will, of course, be important for the Fund to focus on global imbalances, not bilateral imbalances. In a multilateral trading system, large bilateral trade deficits are often balanced by bilateral surpluses with other countries. China might want oil from the Middle East, but those in the Middle East – with so much wealth concentrated in so few hands – might be more interested in Gucci handbags than in China’s mass-produced goods. So China can have a trade deficit with the Middle East and a trade surplus with the US, but these bilateral balances indicate nothing about China’s overall contribution to global imbalances.

Greenpeace was dismissive of a World Trade Organisation (WTO) ruling, due to be released today, on a US-sponsored case which was attempting to force EU countries to accept genetically engineered (GE) organisms, in spite of overwhelming public opposition in Europe.

Greenpeace called the WTO 'unqualified' to deal with issues around GE organisms and rejected the verdict of the US-driven court case backed by Canada and Argentina which was attempting to use the WTO to force GE organisms onto the EU. (1)

"All this verdict proves is that the WTO is unqualified to deal with complex scientific and environmental issues, as it puts trade interests above all others. Its only effect has been to reinforce the determination of EU countries to resist bullying by pro-GE governments and to say no to GE crops and food," said Eric Gall, Greenpeace EU policy adviser.

Despite initial US claims of victory, the interim ruling showed that the WTO panel rejected many of the US arguments, and only gave the EU a 'slap on the wrist' for taking too much time to apply its own legislation. The panel came out against national bans on GE, but did concede that national bans are justifiable, provided a risk assessment is conducted (2).

"The US claims of victory are exaggerated, and will not deter the increasing number of countries in the EU and around the world which act to stop the release of GE organisms," said Daniel Mittler, Greenpeace International WTO expert. "While the WTO ruling fails to uphold the precautionary principle, which should be the basis of GE organism policies globally, it does affirm that governments can continue to ban GE organisms if they so wish."

"There are now 12 GE organism bans in seven EU countries, more than in 2003 when the US presented its case against the EU to the WTO. Only last week, Poland banned the cultivation of genetically engineered crops; a slap in the face to US agro-chemical giants, as Poland is the second biggest agricultural food basket in the EU" said Eric Gall Greenpeace EU policy adviser.

Documents submitted by the EU to the WTO reveal that the Commission defended the "large areas of uncertainty" regarding the impact of GE organisms on health and the environment, and that "some issues have not yet been studied at all" (3). On 12 April, the Commission announced that it was taking steps to improve the risk assessment of GE organisms; current procedures are deemed insufficient and untransparent by most European governments (4).

Greenpeace is an independent, campaigning organisation which uses non-violent, creative confrontation to expose global environmental problems, and to drive solutions essential to a green and peaceful future.

NOTES TO EDITOR:

1. In August 2003, the US, backed by Canada and Argentina took the EU to the WTO for suspending approvals for biotech products, and for six EU member states' implementing national bans on EU-approved GE organisms.

The EU Commission tried to use the WTO case to force five European countries (Greece, France, Austria, Luxembourg and Germany) attacked by the US to lift their national bans (Italy, the sixth, lifted its ban two years ago).

When the EU Commission put its proposal to lift the bans to a vote at the EU Council of Environment Ministers on 24 June 2005, 22 countries out of 25 voted against the Commission, concluding that the bans were justified and should remain. This forced the EU Commission to withdraw its proposals.

Greenpeace briefing on national safeguard clauses ('bans'): http://eu.greenpeace.org/downloads/gmo/NationalBans0507.pdf

2. http://www.foeeurope.org/publications/2006/WTO_briefing.pdf

3. http://eu.greenpeace.org/downloads/gmo/WTOpapers060418.pdf

4. IP/06/498, Brussels, 12 April 2006, "Commission proposes practical improvements to the way the European GMO legislative framework is implemented"

Additional documents
Greenpeace briefing on the WTO dispute on GE organisms is available at http://eu.greenpeace.org/downloads/gmo/WTObriefing0602.pdf

CONTACT: Greenpeace
Daniel Mittler, Greenpeace International WTO expert +49 171 876 5345
Suzette Jackson, Greenpeace International communications officer +31 6 4619 7324
Katharine Mill, Greenpeace EU Unit media officer, +32 496 156 229 (in Brussels)
Eric Gall, Greenpeace EU policy advisor +32 496 161 582 (in Brussels)