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Alert: Hong Kong Free Trade Agreement

Forwarded on behalf of GATT Watchdog

Dear friends,

Below you will find a form letter prepared on behalf of GATT Watchdog and CAFCA which can be adapted and sent to Alliance and Labour MPs, party branches and officials, but also cross-posted on websites (with these introductory notes). With the Labour Party conference coming up in just over a week, and with the news that the government intends to pursue a free trade agreement with Hong Kong, we urge you to act quickly on this. We suggest you send by ordinary mail or email to MPs at Parliament Buildings, Wellington - (it's free!)

Please send us copies by separate email to or by mail to PO Box 1905, Christchurch.

Please repost this message and urge others to act.

GATT Watchdog

______________________________________________________________

(Your Name)

(Address)

(Date)

Dear

In 1997-98, public outrage led to the defeat of the proposed Multilateral Agreement on Investment (MAI) which would have given unprecedented powers to transnational corporations. Yet actions by this government threaten to achieve many similar aims piece by piece. This is despite both the Alliance coalition partner and the Greens, on which the government's existence depends, having campaigned strongly against such policies.

The few controls on foreign investment that remain are being weakened step by step. Major overseas takeovers continue. Fletcher Paper and Air New Zealand are just two since the Labour/Alliance government took power.

I am very concerned that there has been no action to strengthen the feeble controls that are still in place. There are no "national interest" criteria for the great bulk of foreign investment where no significant land or fishing quota is involved. We need to regain the ability to choose investment that suits us, and we need stronger 'good character' laws for foreign investors.

The trigger point for investments to require Overseas Investment Commission approval was raised from $10 million to $50 million by the outgoing National Government, and nothing has been done to reverse that.

In fact, the Singapore "Closer Economic Partnership" cements that in. It commits us to opening even further to foreign investment over the next few years, particularly in the services sector where important social services such as health and education will eventually be affected. On top of that it strips us of the ability to reinstate international capital controls.

I am concerned that this is only the start. There are investment liberalisation agreements that were negotiated by the previous government with Chile and Argentina in 1999, which have MAI-like "expropriation" clauses that would allow investors to force the government to pay compensation, or even revoke laws, if environmental or social measures reduce their profitability. These need only Cabinet approval to go into effect. They have never been opened to public consultation or Parliamentary debate.

The government has announced negotiations with Hong Kong on a similar agreement to that with Singapore. It has committed itself to developing a wider version of the Singapore and CER agreements with the whole of South-East Asia, through negotiations headed by Bill Birch. It has talked about new free trade and investment agreements with Chile and the U.S.A. It supports opening more services to foreign investment through the General Agreement on Trade in Services (GATS) under the WTO, and there are proposals for other investment agreements there too.

I therefore strongly urge you to

· Oppose the Singapore agreement and any consequent legislation

· Gain an assurance that Cabinet will not approve the investment agreements with Chile and Argentina

· Oppose further work on the proposed agreements with Hong Kong and South-East Asia, and other similar agreements

· Support democratisation of the treaty approval process, including releasing drafts of proposed agreements during negotiations so the public can debate them properly.

· Work for a moratorium on further agreements and commitments under the WTO until an independent review has been made of the effects of previous agreements and the public have had an opportunity for a wide-ranging and informed debate on these issues.

The world's political climate has changed radically with the 1997 Asian financial crisis, the Seattle debacle and the numerous demonstrations, critical reports and studies that have followed. Though changes in domestic policies recognise the failure of previous approaches, New Zealand's international economic policies seem not to have taken any notice of the sea-change that has occurred.

Rather than continue to follow the previous government's international free market policies, which are completely at odds with the new government's opposition to free market policies at home, New Zealand needs to manage its economic relationship with the rest of the world. New Zealanders need to have a say in that.

Yours sincerely

Peace Movement Aotearoa the national networking peace group PO Box 9314, Wellington, Aotearoa / New Zealand. tel +64 4 382 8129, fax 382 8173, website Internet Peace Gateway


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