The WTO Stalemate: One very big “no”


The
World Trade Organization (WTO) is a paradoxical institution. It
was founded on the ostensible notion of “free trade” improving
living standards around the world, but its agreements serve mainly
corporate interests in North America, Europe, and the developed
Asia-Pacific region (Japan, Australia, New Zealand). Its structure
holds out the hope of democracy and equal participation, but in
practice it is the scene of tremendously coercive political and
economic manipulation. Its flaws, in particular the unfair advantage
that wealthy countries have in negotiations, have been explored
at length over its eight-year life. But some hope always flickered,
particularly because the organization makes decisions through the
consensus of its 146-government membership. 

As
it turns out, the leadership of the WTO did not learn much in Seattle,
but they made sure to hold their future bi-annual summits in easily-controlled
locations far from tenacious protesters. The November 2001 summit
was held in Doha, Qatar, one of the principalities on the Arabian
Peninsula where freedom of expression is sharply restricted. This
year’s conference took place on a narrow, single-road peninsula
consisting entirely of resort hotels just outside the city of Cancún,
which is on the remote Yucatan Peninsula in Mexico. 

The
Cancún Summit (September 10 to 14, 2003) was not a re-play
of Seattle, where well-organized protesters, both inside the convention
center and on the streets outside, combined with government delegates
embittered by the arrogance of the U.S. hosts, to shut down the
new round of negotiations.  


Demonstrations Outside 

Opponents
came to Cancún from at least 40 countries. The numbers were
smaller than the 50,000 some predicted. But organizers on the ground
always knew that such numbers were unlikely to materialize. There
were approximately 10,000 to 15,000 people at the height of the
protests, which started at the opening ceremony on Wednesday, September
10. The march that day was organized by Via Campesina, the international
network of small-scale agricultural producers. The event was both
spirited and sober, as participants were conscious of the gravity
of the plight faced by most of the farmers there, who are engaged
in a losing battle with a rigged global trading system that keeps
commodity prices artificially low, undermining non-corporate agriculture
everywhere. Most of the marchers were from Mexico, but there were
farmers from West Africa, Japan, the United States, India, South
Korea, and many Latin American and Caribbean countries. The Korean
delegation was particularly impressive—composed of nearly 200
people, most of them farmers, along with a contingent from the Korean
Confederation of Trade Unions. 

The
Koreans surprised the other marchers by charging the main barricade
with a battering ram reported to look like a dragon. A few minutes
later, a Korean farmer named Lee Kyun-Hae climbed the fence with
a sign reading “WTO Kills Farmers” and stabbed himself
in the chest, performing a “self-immolation.” Such suicides
have become common among small-scale farmers in Asia when they find
they cannot maintain their livelihood (and are not unheard of among
U.S. family farmers). By committing suicide at the WTO summit, Lee
put the corporate-biased agricultural policies of the WTO in the
spotlight with undeniable pathos, a searing attack on the WTO’s
human impact that no one could ignore. 

Saturday’s
march ended up being smaller than Wednesday’s, largely because
most of the campesinos could not afford to stay so long in Cancún.
But it was a well-organized expression of solidarity between students
and farmers. A group of women departed from the colorful march to
take wire-cutters to the barricade, followed by a group led by the
Koreans who tied ropes to the fence and pulled it down. The police,
who had additional barricades a few hundred yards up the road, tolerated
the action as a symbolic assault on the WTO. After the barricade
fell, the protesters sat down and observed a powerful tribute to
Lee and the fight for justice for which he gave his life. 


Taking the Message Inside 

In
addition to the protests in downtown Cancún and the smaller
actions on the streets just outside the convention center, many
activists penetrated the meeting site—all entirely legally.
The WTO accredited some 980 non-governmental organizations, though
they were not allowed near the rooms where negotiations were taking
place. There were also well over 1,000 reporters using the media
center, which had generous banks of computers, printers, fax machines,
and DSL lines. Only 200 NGOs were given passes to the opening ceremony,
but about 30 of them made good use of the opportunity by standing
with their mouths covered by black tape, holding signs with messages
like “WTO Obsolete” and “WTO Undemocratic,”
as Director General Supachai Pantichpakdi spoke. Security guards
isolated, but did not accost them, so they chanted “shame,
shame” as they filed out of the hall. 

A
press conference on agriculture by the Deputy U.S. Trade Representative
was interrupted twice the next day by activists denouncing the anti-farmer,
pro-corporate policies of the U.S. government and the WTO. A few
hours later, a notice tacked onto the video bulletin board listing
upcoming press conferences read: “Because of an incident on
September 11, NGOs will no longer be allowed to attend press briefings.” 

The
Group of 21 countries, or G-21, held a press conference on Tuesday,
September 9. The foreign minister of Brazil, the deputy trade minister
of China, and trade ministers from India, South Africa, Argentina,
and Costa Rica gathered to announce the group’s determination
to stick together throughout the conference. The group had formed
in response to the WTO Secretariat’s release of an “official
draft text” for the Cancún summit. That document was based
almost wholly on a joint submission by the United States and the
European Union and was widely attacked for ignoring the concerns
developing countries had been expressing since the Doha ministerial
where the terms of the negotiating “round” were laid down. 

The
group’s agenda was fairly narrow—insisting on cuts in
Northern countries’ agricultural subsidies and greater access
to Northern markets—and the speakers at the press conference
dwelt on their determination not to succumb to inducements or threats
from the Northern governments designed to erode their unity. The
group’s de facto coordinator, Brazilian Foreign Minister Celso
Amorin, said, “We will keep our unity, which will be tested
repeatedly, starting from this very moment.” They also emphasized
the significance of the constituency they represented—63 percent
of all farmers and 51 percent of the world’s population. 

The
seriousness of the challenge represented by the G-21 was made clear
by the intensity of the campaign launched by delegates from the
U.S. and the EU to discredit or split the group, and to bribe other
countries to pledge not to join. But by the end of the conference
the only changes were the departure of El Salvador, its right-wing
government successfully bribed, and the addition of Nigeria and
Indonesia. Population isn’t everything, of course, but in adding
up the numbers after that realignment, the G-20+ (as it came to
be called) ended up representing over 60 percent of the world’s
population (the list on September 15 was: Argentina, Bolivia, Brazil,
Chile, China, Colombia, Costa Rica, Cuba, Ecuador, Egypt, Guatemala,
India, Indonesia, Mexico, Nigeria, Pakistan, Paraguay, Peru, Philippines,
South Africa, Thailand, and Venezuela). 

As
negotiations dragged on and after the talks collapsed, U.S. officials
blamed the G-20+, though seldom by name. According to people who
saw his final press conference, the lead U.S. delegate, Robert Zoellick,
was clearly driven to distraction by the Southern-led collapse of
the talks. His threats to shift the U.S. focus to bilateral trade
treaties, such as those recently concluded with Morocco, Singapore,
and Chile, seem likely to go forward, even though the EU and WTO
officials say they further complicate the global system. The U.S.
has already been moving forward in negotiations for sub-regional
pacts, like the Central U.S. Free Trade Agreement and a Southern
Africa Free Trade Agreement. The U.S. has nearly unlimited leverage
in those sub-regional and bilateral agreements and can maneuver
countries into giving in on more issues than are even brought up
at the WTO. Chile, for example, pledged to abolish its capital controls,
which were long pointed to as the model for Southern countries wanting
to exercise some control over “hot money” foreign investments
that can be quickly pulled out of a country at the hint of panic. 

Tempting
as it may be to see the governments of the G-20+ as warrior-heroes
facing down the evil empires of the North, we should not lose sight
of the fact that they are all political formations too, many of
them unsavory or at least as prone to self-serving, corrupt actions
as our own. India’s fundamentalist-fascist government is not
likely to become a progressive model as a result of being a leader
in the G-20+ and China is not going to adopt a new conception of
human rights. Toward the end of the Cancún meeting, there were
rumors—still unsubstantiated—that certain countries in
the G-20+, including Brazil and China, were eager to find a way
to make some sort of deal. 

A
case could be made that the real mavericks, the ones who took the
decisive position that halted the meeting, were those in what became
known as the G-32 or G-33 (call it G-30+ for consistency). Drawn
largely from the ACP group (Africa-Caribbean-Pacific, from a trade
treaty between the EU and the more impoverished exporting nations),
the G30+ was usually represented by Indonesia and did have other
overlaps with the G-20+. But the bulk of its membership was the
poorest countries, particularly in Africa. In distinction from G20+
groups, that sought cuts in Northern subsidies and access to Northern
markets, the G30+ focused on “special products”—that
is, identifying a range of agricultural commodities, perhaps different
from country to country, that governments could protect without
penalty. 

The
G-30+ did not have the high profile of the other group, but in political
terms its aims—maintaining unity in the face of intense pressure
from the North—were similar and its success at least as great.
There were efforts to unite the two groups and reports that a large
group of African countries was close to joining the G-20+ as a bloc.
In the end, they were not persuaded in time, but the two groups
were clearly cooperating strategically. The take-home idea from
Cancún will be, as intended by both the G-20+ and the G-30+,
that the South will not be easily broken in future trade negotiations
at the WTO and perhaps other fora as well. Even if all the “Gs”
become obsolete in a matter of months, it is that specter that will
haunt Zoellick and his EU counterpart, Pascal Lamy, from now on. 


Anatomy of the Final Standoff 

In
analyzing Cancún, few commentators have questioned the notion
that one of the Southern-country blocs is responsible for the “failure”
at Cancún. The implicit idea, made explicit by some, is that
all of the Southern governments have simultaneously been captured
by “radicals.” Deputy U.S. Trade Representative Josette
Shiner went on the PBS “NewsHour” with Jamaica’s
chief negotiator, Richard Bernal, and said she thought the developing
countries were getting poor advice from NGOs like Oxfam. Apart from
the bold effrontery necessary to go on national television and accuse
a high-ranking official from another government borrowing his positions
and strategies from an NGO, Shiner seemed to be asking viewers to
accept that every Southern country from Mali to China was also content
to leave their strategizing and policy making up to Oxfam. 

It’s
not that all the governments of the G-20+ and G-30+ were suddenly
infected with anti-imperialist fervor. Most of them want to make
trade deals with the U.S., EU, and Japan—many desperate to
do so to get more hard currency. But the recognition that the WTO,
and the entire global economic system, is rigged to keep them in
the role of suppliers of cheap labor and cheap commodities has finally
become undeniable, even for trade and commerce ministers trained
at schools like the London School of Economics or veterans of places
like the World Bank. 

Whether
one considers the collapse promising or distressing, it should be
clear that the real obstructionists were the Northern countries.
The U.S. took the lead in remaining unmoveable on agriculture concessions
and the European Union and Japan staffed the barricades on the “Singapore
issues.” It was the North’s unwillingness to give any
ground, not the new insistence by the South that they deal openly
and fairly, that prevented progress toward an agreement. 

When
the WTO was created in 1995, at the culmination of the “Uruguay
round” of talks under the predecessor organization, the General
Agreement on Tariffs and Trade (GATT), the U.S. and its allies successfully
insisted on the inclusion of a number of issues that had been excluded
from GATT talks. Notable among those were agriculture, the General
Agreement on Trade in Services (GATS)— which applies to commerce
in everything from insurance to water provision to postal delivery
and has yet to fully come into effect—and Trade-Related Intellectual
Property Rights (TRIPS), or patents, which has been the source of
the international debate on pricing of HIV/AIDS medications and
other life-saving drugs that can be manufactured cheaply by producers
of generics. That last controversy was temporarily resolved just
before Cancún with an agreement between the pharmaceutical
industry and the U.S., EU, Brazil, South Africa, and Kenya—an
agreement widely, though not universally, denounced by HIV/AIDS
advocacy groups. 

The
inclusion of each of those issues, which, with the exception of
agriculture, had not been considered part of “trade,”
in the new WTO was considered a significant concession by many developing
countries. Government procurement, competition policy, trade facilitation,
and investment were successfully put off until the first WTO summit,
held in Singapore (hence the “Singapore issues”). 

Although
agriculture got the great bulk of the attention during the meeting,
it was lack of common ground on the Singapore issues that led the
Mexican hosts to declare the meeting over. On those issues, the
G-30+ were standing by the terms agreed to at the 2001 summit in
Doha; it was the EU and Japan (and, oddly, South Korea, which swings
between Northern and Southern identities) that took a hardline position
and refused to budge. 

In
Doha, under pressure to show support for the United States in the
weeks after the September 11 attacks and to send a “reassuring
message” to the global economy, the countries of the South
were reluctantly drawn into an ambiguous declaration initiating
the “Doha development round” of negotiations—so named
as an inducement to the South, which was told that the rich countries
would allow the development needs of the poorer countries to weigh
more heavily than the usual imperatives of corporate profit during
this round of talks. In the run-up to Cancún, many commentators
and Southern country officials complained that the North had not
carried through on its promise; by the time they got to Cancún
the cynicism of that pledge was old news and hardly even mentioned. 

Doha
ended in a chaotic jumble after several extensions of the final
session, ultimately reaching 38 consecutive hours. Having exhausted
their counterparts from smaller delegations and won a number of
concessions, the U.S. and its allies finally had to make one concession,
by accepting the Indian government’s insistence that negotiations
on the “Singapore issues”—the effort to agree on
common rules for investment, competition policy, government procurement,
and trade facilitation, etc.—could go forward only if and when
WTO member countries approved with “explicit consensus.” 

Almost
no Global South countries declared themselves in favor of opening
negotiations on any of those issues. Coming into Cancún, 70
countries joined in an unequivocal rejection of taking them up.
During the course of the meeting that number swelled to 90. It seemed
that no one could possibly argue that an “explicit consensus”
 existed. 

The
World Development Movement, a British NGO, clearly knew better.
The EU wanted all four issues to go forward, so the WDM made badge
holders—the nylon necklaces that hold picture-identification
credentials at meetings like the WTOs—with the phrase “explicit
consensus” printed in English, French, Spanish, Arabic, and
Hindi. They were widely distributed and became the subject of a
ban on the conference’s fourth day. Security personnel were
ordered to confiscate them at all entrances for several hours, until
someone pointed out that the action would probably not pass a Mexican
constitutional test. 

The
WDM folks weren’t the only ones that arrived with props. From
out of nowhere a document from the government of Niger, which seemed
to express interest in supporting the Singapore issues, started
circulating; it was soon revealed to be out-of-date and from a low-level
bureaucrat. Then Togo, a tiny country with the longest-reigning
dictator on the African continent, indicated it would support the
new issues. The rest of the African countries repudiated Togo’s
stand. 

The
EU stuck by its position. Never addressing the question of “explicit
consensus,” Pascal Lamy, together with his Japanese and Korean
counterparts, insisted that a commitment to begin negotiations on
the Singapore issues should be included in the final declaration.
A last-minute offer by Lamy to drop the two more controversial issues—competition
policy and investment—was not enough. The G-30+, and many other
countries as well, saw the EU position as an unbearably arrogant
dismissal of clearly-articulated positions by a majority of WTO
member countries. After quick consultations with its African partners,
the Kenyan delegation was the first to say that there could be no
compromise with Lamy and a member of the delegation was sent to
the media center to tell the throng of reporters, “It’s
over.” 


What’s It All Mean? 

The
simplest assessment is that it means no changes in the status quo:
the round is stalemated for now, though there will be attempts,
however faint, to revive it in Geneva in the months to come. It
means the next WTO summit, set for Hong Kong in either late 2004
or early 2005, could be the last gasp of the Doha round. The WTO
may become more of an administrative body, interpreting treaties
and adjudicating disputes, rather than hosting negotiations. 

For
Northern governments it can be taken as a sharp repudiation of the
coercive negotiating tactics they have used since Southern countries
first entered the GATT. There have been calls from many parts of
Europe for Lamy to resign. A different perspective is offered by
The Economist, the British weekly of the elite classes. For
its editors, Cancún is the most vivid sign that Southern countries
have been given too loud a voice. It recommends following the lead
of the Bush administration, with its firm squelching of Africa’s
request for slightly expanded board representation. 

For
Southern governments it is positive reinforcement for the impulse
to at last refuse the exploitation of the North. For people in both
the North and South, it’s good news. It means a greater chance
for peace, fair trade, decent livelihoods, dignity, healthy food,
a more sustainable ecology, and a global sense of solidarity. For
the global justice movement, Cancún takes its place in the
honor roll of victories that includes Seattle and the freezing of
the Multilateral Agreement on Investment (MAI) in 1997-98. Ironically,
it was the attempt to revive the MAI in the form of the Singapore
issues’ investment provisions that sealed the fate of the Cancún
talks.  

Cancún
should be publicized as a major victory for the global justice movement,
even though the result was not precisely a direct result of the
movement’s efforts. However, the resolve of government negotiators
in Cancún to stand up to the Northern plutocracy was undoubtedly
created, in part, and significantly reinforced by the pressure mounted
by the movement. From the policy wonks at organizations Focus on
the Global South, Third World Network, ActionAid, and, yes, Oxfam,
to the vivid, courageous, and persistent street demonstrations proclaiming
an abiding belief in “people before profits,” the movement
was indispensable to the triumph in Cancún. 

If
the movement is able to sustain momentum and pressure, it may be
the beginning of a positive shift in the way governments deal with
social movements, with their own constituents, and with those who
would exploit their people; it may even be the start of the political
paradigm shift so many have been working for. 

Lest
the movement give in to the temptation to euphoria, it should be
said that history would suggest that preparing for betrayals and
buy-offs would be a good idea. But it should also be said that there
are other indications of a positive shift. In the same week as the
Cancún meetings, Argentina was able to negotiate a new deal
with the IMF to re-schedule its massive debt to the institution.
By exercising its power as a large debtor (when you owe the bank
$100, it owns you; when you owe the bank $100 million, you own it),
and wielding the support of its neighbors and others, Argentina
successfully resisted most of the key demands made by the IMF, including
dramatic hikes in utility rates and increased mortgage foreclosures.
Such successful bargaining is practically unheard of at the IMF
and, together with the news from Cancún, it suggests that when
the power of public opinion is brought to bear on governments, governments
will sometimes stand up for their people—and that the centers
of the North’s concentrated power can be overcome. 

Finally,
all eyes turn to Miami, where trade and foreign ministers from around
the western hemisphere will gather in mid-November to continue negotiations
on FTAA. Continued success is necessary there to preserve the momentum
from Cancún. The “buzz” about the event across North
America’s activist communities is probably the loudest it has
been since Seattle and promises a very interesting few days (November
17-22). The key to Miami, from the insider’s perspective, is
the position of the Brazilian government. With Brazil’s new
president, Lula da Silva of the Workers Party, there are reasons
for optimism. But Lula has also made alarming noises about wanting
to have the FTAA in place by 2005, even as other signals suggest
a desire to subvert the plan. Brazilian activists are uncertain
about where Lula will finally come down on trade with the U.S. The
stakes are very high this time: Miami will tell us a lot about the
future of globalization.
 



Soren
Ambrose is with the New Voices on Globalization/50 Years Is Enough
Network.
Photos
in this article by Orin Langelle.