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Jane Kelsey WTO: Development Deceits

Development Deceits

BULLETIN #4 FROM HONG KONG: 15 December 2005
By Dr Jane Kelsey

See also:
BULLETIN #1 - Creating a Climate of Fear in HK
BULLETIN #2 - The Antidote to Fear-Mongering
BULLETIN #3 - Opening skirmishes

Despite the heavy spin, it is hard to find anyone who genuinely, hand on heart, believes the rhetoric about a Doha ‘Development’ Round.

Every deadline that was set to address the concerns raised by poorer countries has been missed, even when they were revised several times.

Promises, most notoriously those made to desperately poor cotton producing Sub- Saharan Africa in Cancun, have been reinterpreted to make them subject to concessions on issues of priority to the major powers.

So when the powerful players who set the WTO’s agenda for the 6th WTO ministerial conference announced they would frontload ‘development’ concerns, alarm bells rang.

During the lead-up to the Hong Kong ministerial groupings of ‘developing’ and Least Developed countries have staunchly opposed most elements of the negotiating text that the US and Europe see as baselines. Two days into the Ministerial meeting those conflicts have not been resolved.

There is a very real prospect of deadlocks like ones that collapsed the ministerials in Seattle in 1999 and Cancun in 2003. From the perspective of the EU, US and Japan that resistance has to be broken. Two classic strategies in such a situation are bribery and divide and rule.

The bait is a so-called ‘development package’. Each of its five elements is deeply flawed. All are designed to promote compliance with WTO agreements. None addresses the structural economic factors that have deepened poverty within the poorest countries since the creation of the WTO in 1995.

The most outrageous element, dubbed ‘aid for trade’, is essentially a bribe – and a deceptive one at that. Japan’s proposed $10 billion trade-related aid package over the next five years was already pledged at the July 2005 meeting of the Group of 7.

Likewise, most of the $2.2 billion that the US has said it will deliver to build trade infrastructure and competitive services in LDCs by 2010 has already been promised. Moreover, it is explicitly made ‘subject to the President’s budget request being approved’.

Much of this ‘aid’ would come as loans, strengthening the hands of the IMF and World Bank in dictating the policies of recipient countries and burdening them with further debt if the trade-driven policy agenda fails.

The second element involves tariff-free entry for exports from LDCs. The US is insisting on the right to reserve sensitive sectors, fearing that free entry for textiles imports from Bangladesh and Cambodia will compound the domestic turmoil over imports from China. It also says this would not become available until the rest of the round was concluded.

The third element is the already agreed ‘solution’ to the saga over rights to affordable access to life saving medicines under TRIPS agreement. A proposed new interpretation of this agreement was recently endorsed by the WTO’s General Council, but many analysts and developing countries believe is too complex to be unworkable.

The fourth and fifth elements reinforce the existing Integrated Framework for Capacity Building that is run by the IMF and World Bank and narrowly defined forms of special and differential treatment. The package has spawned a mass of critique in a very short time. A group of NGO’s found a more creative way to get their message across as EU Trade Commissioner Peter Mandelson emerged from a press briefing in the Convention centre. Bedecked in Santa hats and tinsel and carrying gift wrapped empty boxes labeled Empty Development Box, they sang to the tune of Jingle Bells

Mandelson, Mandelson,
This gift we give to you
Trade for Aid
Is the game you play
It’s empty through and through

Mandelson, Mandelson,
This gift we give to you
Trade for Aid
Is the game you play
It’s empty through and through

Stop double UTO
From bribing the poor lands
Your mouths are full of lies
The Truth is Empty Hands

So Mandelson, Mandelson, etc

The jury is still out on whether this strategy will convince some poorer countries to break ranks and to waive their objections the current text. The fraudulent nature of the package may be apparent to experts, but the lure of apparent new money is seductive for poverty-stricken governments.

ENDS

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