Statement of the Socialist International on the 5th WTO Ministerial Conference, Cancún

Cancún, Mexico, 10-14 September 2003

FROM CANCUN TO FAIR TRADE 

Towards fairer trade

The Socialist International seeks better global governance through international cooperation with organisations responsive to the aspirations and concerns of the peoples of the world. To achieve the aims of reducing poverty and reversing the trend of weakening democratic institutions, globalisation needs to be governed. The goals of global reform must be fairer distribution of the benefits of trade, sustainable development and reaffirmation of democratic accountability.

A reformed system of global trade is therefore essential, including trade rules to govern the conduct of governments and companies and ensure fair treatment for all. Changes are needed to guarantee full opportunities and support for the world’s poor, to ensure that trade rules do not override national sovereignty on non-trade issues and to make the world trade system more open and accountable. Global markets must be underpinned by global rules and institutions that place human development, environmental issues and public goods before strictly commercial interests and national advantage.

Open markets are essential for development. No country has developed by turning its back on trade, and no country today can prosper by rejecting globalisation. But to benefit from international trade some countries need a diversification of their economy to increase their trade capacity and to avoid relying on the export of one or two products. Some developing countries will need time before a full opening of their economy. If the unequal situation of trade partners is not taken into account, free trade is often not fair trade. Free trade can be a tool and not a goal in itself. The challenge is to reshape the world trade system in the interests of democracy and development. Opening up trade by itself is not sufficient. To promote the goals of poverty eradication and sustainable development, trade policies must be complemented by investment in human resources and development of infrastructure, areas where international development cooperation plays an important role.

Trade is a critical test of the world's ability to manage globalisation, particularly through the WTO trade talks known as the Doha Development Round, launched in December 2001. The Development Round is scheduled to close in December 2004 and time is growing short to correct the imbalances in the world trade system. Furthermore, several objectives fixed in Doha are not fulfilled yet: Special and differentiated treatment, agreement on the disputes settlement, TRIPS and medicines access, modalities on agricultural products trade, agreement on textiles.

The Socialist International urges that the forthcoming WTO Ministerial Conference in Cancún take all possible concrete steps to ensure that progress is made towards promoting fairer trade, equitable and sustainable development.

 

Towards a more open and democratically accountable WTO

To ensure that democratic choice prevails in an era of global interdependence, international treaties and institutions must pass the same tests of democracy and fairness as we apply in national and local politics. That requires reform of the WTO and a broader strengthening of global governance. The Socialist International therefore advocates greater transparency and communication in the workings of the WTO and wider involvement of civil society in trade issues. More WTO meetings should be open to the public, with wider and earlier derestriction of documents, including those relating to disputes. The possibilities and capacities of developing countries to participate on a more equitable footing in the multilateral trading system and in the WTO must be enhanced. Their concerns about the implementation of WTO commitments must be met and their ability to have an effective voice increased through technical assistance programmes. (Consideration should be given to creating a WTO parliamentary assembly and parliamentary scrutiny by WTO member parliaments should be strengthened. A WTO parliamentary assembly and parliamentary scrutiny should be created by WTO member parliaments.)

 

The WTO must seek cooperation on non-trade issues

The WTO cannot and should not strive to be the international organisation which settles environmental, social and labour, or other cultural issues. The division of responsibilities between the WTO and those international organisations which have the competence to address these issues should be clarified and cooperation between them intensified, for which implementing closer cooperation between the ILO and the WTO could set a good example.

An extension of the WTO's mandate to include global rules on investment and competition should not be contemplated without broad support from developing countries and should never be a condition set up by developed countries for an agreement with developing countries at the Ministerial Conference of Cancún. Any such rules should respect fully the right of host countries to regulate investment and pursue their own development model; and they must form part of a wider package that strengthens the obligations of investors towards host countries and restores the regulation of corporate activities, which the globalisation of capital has undermined. Certain fields of human activity must by and large remain outside the negotiating framework, such as education, health and culture.

The efforts to revise the functioning of the Dispute Settlement Body should come to a result by ensuring that its decisions are transparent and respectful of the international conventions in the area of human rights.

 

The WTO must not let trade undermine respect for workers’ rights

Globalisation creates constant pressure for reduced core labour standards and all too often for increased misery and exploitation, especially of women workers and in export processing zones. The Socialist International believes it is a priority to protect the fundamental rights of workers against unscrupulous governments or companies that seek unfair advantage in international trade through the violation of core labour standards. Respect for these standards is crucial to achieving fair, sustainable and democratic economic development.

WTO members must update agreements, including GATT Article XX and GATS Article XIV, to incorporate human rights standards that include core labour standards.To enable full examination of the link between trade, jobs and core labour standards, the WTO, with the ILO playing a full and equal part, must set up a formal structure to address trade and core labour standards. Such a body should also address wider, trade-related social issues such as the impact of trade policies on women and the provision of adjustment assistance for workers displaced by trade.

 

The Doha Round must be a Development Round - and an Anti-Poverty Round

Steps must be taken to enable developing countries to capture a greater share of the benefits of globalisation. Wealthy countries must provide duty-free and quota-free access to their markets for the least developed countries, and radically improved market access for all developing countries. Changes are needed in many areas that put developing countries at a disadvantage — including agreements on antidumping and agriculture. WTO rules on intellectual property must be redesigned in order to promote technology transfer, cut the cost of access by developing countries to intellectual property and overcome the North-South knowledge gap and digital divide, a major obstacle to economic and social development in the South. A breakthrough is needed to facilitate far better access of poorer countries to pharmaceuticals.

WTO rules must grant developing countries the flexibility they need to pursue their development strategies and protect public services. Rules on trade in services must be clarified, to protect the right to public control over the delivery of basic services such as health, education and water. Full respect for core labour rights should be promoted in the interests of fairer distribution of the benefits of trade. The GATS text needs to be revised to include a definition setting criteria for the distinction between services considered as tradables and those considered as non-tradables. This should allow for the definitive exclusion of services in sectors such as health, education, culture or audiovisual from the negotiations.

Wealthy countries must substantially reduce barriers to exports from poor countries in all areas, including agriculture, reflecting their levels of development. All forms of agricultural export assistance should be gradually eliminated by all countries and permitted domestic agricultural support should be redirected towards measures aimed at promoting public goods, such as environmental protection and rural development. The European Union has now taken a step in this direction. Other developed countries are now called upon to move, of which first and foremost the United States of America. As now agreed by member states in June 2003, all WTO members must adhere to pledges on trade-related assistance to strengthen the role of developing countries in world trade. In addition to changes at the WTO, the World Bank and IMF should end their insistence on trade liberalisation by developing countries as a condition of assistance. An Economic and Social Security Council should be created in the framework of the United Nations system, as a multilateral institution of regulation and governance.

 

Sustainability should be put at the heart of the WTO agreements

The WTO must ensure that within its own area of competence, agreements and rules regarding sustainable development and the environment are honoured and enforced. WTO rules should be clarified wherever there is a risk that they may conflict with Multilateral Environmental Agreements. The precautionary principle should be more clearly and less restrictively defined, and should apply to all WTO agreements. The right to refuse imports of goods whose production is environmentally damaging should be clearly established. International agreement must be found to ensure that transport costs reflect their environmental impact. Assistance must be given to developing countries to help them comply with environmental measures. Developed countries should also help developing country exporters to meet the required higher standards by allowing widespread access to information and making sure regulator frameworks are transparent.

WTO negotiations must address the greater need of developing a new global order built on peace, human dignity, social cohesion and shared prosperity. Trade, if properly promoted and guided through a carefully considered global framework, can make an immense contribution to this challenge. The Socialist International calls upon the Cancún Ministerial Conference to live up to this global responsibility.

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