Socialist Worker

WTO, Afghanistan, Pakistan: Only crumbs for the world's poor

The WTO meeting has offered multinationals and powerful governments new opportunities to plunder public services and chew up the Third World.

Issue No. 1776

'Coming just a day after the advances in Afghanistan, it signals the determination of the world's community to fight terror with trade, as well as arms.' These are the worlds of Patricia Hewitt, New Labour's trade and industry secretary, celebrating the outcome of the World Trade Organisation meeting last week in Doha, Qatar.

In reality the WTO meeting has offered multinationals and powerful governments new opportunities to plunder public services and chew up the Third World. Western leaders are also aware that, two years since Seattle and four months since Genoa, anti-capitalists have put their decisions in the spotlight. Widespread criticism of the WTO has also encouraged some governments, such as India, to demand more concessions before accepting US demands.

As a result the US and European Union (EU) countries did not get everything they wanted. But they rammed though an accelerated timetable for GATS (General Agreement on Trade in Services) which will clear the way for further privatisation. They also made it easier for Western corporations to keep on spewing pollution throughout the planet. They maintained the barriers blocking Third World countries getting cheap life-saving drugs.

Chancellor Gordon Brown dares to speak of a 'new deal' for the poor. The decisions made by the British government and its allies last week will mean more death, more suffering and more poverty. Barry Coates is the director of the World Development Movement. He was in Qatar for the WTO meeting. He explained:

'The Outcome of the WTO meeting is a disaster for the world's poor. The much-hyped development round is empty of development. This massive extension of the WTO into new areas is both reckless and dangerous. The cost of current trade agreements is already being counted in people's lives.

Tony Blair has called for an end to the 'hypocrisy' of the richest nations protecting their markets from the exports of the poorest while claiming to be concerned for the world's poor.

The British government and the EU have played a shameless role in taking this hypocrisy to new heights. This deal would not have happened without the abuse of the negotiations that has seen countries threatened and bullied.

Almost the whole of the conference was devoted to issues of interest to the rich countries. The concept of a development round was completely sidelined. The poorest countries in the world, such as Mozambique, were forced to spend their time negotiating on investment agreements and intellectual property rights, instead of improving their access to developed countries' markets. The tragedy was that the issues of vital importance to the world's poor didn't get a look in.

The EU and the US have exploited the vulnerability of poor countries in order to force their agenda on them. Even where it appears that developing countries may benefit, the declaration is so riddled with holes and get-out clauses that the gains are likely to be illusory'.

What's the deal after Qatar?

What the agreement says:

  • The preamble to the declaration provides uncritical praise for privatisation and trade liberalisation. It ignores the deep problems this has caused for the poorest countries.
  • GATS: The text sets dates for countries to say when they are going to let companies compete to take over public services. Requests for countries to open up their service sectors will be sent out from the WTO by 30 June 2002. In another section of the declaration (on WTO rules) there is a dangerous new commitment to 'the reduction or elimination of tariff and non-tariff barriers to environmental goods and services'. Not only would this include environmentally damaging services such as nuclear waste processing, but services such as water as well. This would then provide an accelerated push to opening up the supply of water, waste collection and other public services in all countries.
  • Agriculture: The main point of contention was whether the EU would agree to the aim of 'reductions of, with a view to phasing out, all forms of export subsidies'. At the last hour they did agree, but added a caveat to say that this aim is 'without prejudging the outcome of negotiations'. This severely undermines any commitment to open up EU agricultural markets to exports from the developing world.
  • TRIPs: Allows giant pharmaceutical companies to protect their patents and keep up the prices of drugs. The Doha Declaration on TRIPs and Public Health confirms the existing arrangement in saying that TRIPs 'does not and should not prevent members from taking measures to protect public health'. This confirmation was only required because of the aggressive attacks by the US on the rights of countries to prioritise affordable treatment for health emergencies such as HIV/AIDS.
  • Environment: The declaration includes negotiations on Multilateral Environmental Agreements (MEAs). The text gives the US a get-out clause on agreements it has not signed, such as the Kyoto Protocol on Climate Change.

    It also provides an incentive for countries not to sign up to MEAs, thereby benefiting from international action without being bound by any of its provisions.

  • US rewards friends with debt

    Blair and Bush promised the people of Afghanistan that there will be big improvements in their lives if the Taliban are defeated. But Western policies have wrecked millions of lives in neighbouring countries regarded as 'friends of the US'. Pakistan has played a key role in the war against Afghanistan.

    The US government dropped its previous mild criticism of the government of General Pervez Musharraf. In exchange Pakistan agreed to allow US forces to use its territory to launch attacks on Afghanistan. Musharraf was installed by a military coup in 1999.

    Bush has also promised some economic aid. But this is a drop of water to deal with the desert that the debt system and the demands of the World Bank have caused. The Financial Times commented recently, 'Two ugly features blight Pakistan's economic landscape: poverty and debt.'

    In Pakistan a child under five dies every 40 seconds from malnutrition. A woman dies in childbirth every 90 seconds because of a lack of health facilities. Of every £1 received by the government in tax and other revenues, over 60p goes straight to the bankers to pay debt.

    Debt payments make up nearly half of total budget spending. Spending on debt exceeds social and poverty related expenditures by four times. Nothing will change as a result of the war bribe from Bush. He has promised to cancel just $1 billion of the $37 billion debt mountain.

    Pakistan is now caught in a downward spiral of begging for new loans to pay off the old ones. Each new loan comes with harsh conditions of privatisation and the removal of subsidies, which keep food prices low.

    In the 1950s and 1960s 80 percent of the aid which Pakistan received was grants, which did not have to be paid back. Today 85 percent of what is received is loans which must be returned with heavy interest.

    While the banks get their cut, millions of people struggle to survive. The percentage of households living in poverty doubled from 17 percent to 33 percent between 1987 and 1999. There are now 44 million people without enough income to buy basic food to survive.

    In a total adult population of 80 million, 49 million are illiterate. The average child completes just 1.9 years at school. The turmoil caused by the war will lead the Pakistan military, which already demands a major slice of the budget, to ask for still more.

    An IMF report in October this year said, 'Pakistan's long-term external outlook is unsustainable with most debt indicators worse than for many of the poorest countries eligible for debt relief in Africa and South America.' This is a country which was a long-term Cold War ally of the US.

    Whatever happens in Afghanistan, there is a seething mass of resentment, desperate poverty and alienation from the West in Pakistan. That means more instability.

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Sat 24 Nov 2001, 00:00 GMT
Issue No. 1776
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