WTO: corporations vs common man

Opinion1-15 January 2006

Article: WTO: corporations vs common man

By: Ms. Najma Sadeque

Most people struggling with their daily lives are not even aware of the sixth WTO ministerial in Hong Kong. But their fate hinges on it. While the developing world is indeed suffering economic crisis because of reasons ranging from the familiar debt trap to short-sighted policies, the EU and the US have their own economic crises too. Accustomed to easy agricultural subsidies that total around a billion dollars a day, they now face stiff worldwide resistance to their dumping practices. The subsidies enable them to undercut or sell to poorer countries at prices even lower than the latter’s negligible cost of production, thus ruining the lives and economies of most South countries.

The fact is that if their agricultural subsidies were taken away from them, the EU and US may be able to feed themselves, but would not be able to produce for export. A study conducted by the independent Institute for Agriculture and Trade Policy in America found that the US has been dumping five agricultural commodities in the world market: corn, wheat, soybeans, rice and cotton. The developing countries lose over $40 billion in agricultural export income every year because of EU and US subsidies and protectionism.

The ministerial, the WTO’s highest decision-making body led by trade ministers, has now evolved into a global standoff between the industrialized countries and the South, and between multinational corporations and two-thirds of the world’s people impacted by WTO.

The long-winded jargon of the WTO agreement makes it incomprehensible even to the educated. With no effort on WTO’s and most governments’ part to disseminate or debate it with the public, it took half a decade or more for it to dawn on most South country governments that they had been taken for a ride. Pakistan was among those countries that finally took some sort of stand rather late in the day.

Much of the credit goes to activists and academics of independent civil society organizations both in the North and the South for reducing the wordy rigmarole to its essence – which is so outrageous in its demands that it becomes understandable why it had to be camouflaged in verbosity.

For, it is not only the ordinary people of the developing countries being hit. The WTO agreement started with under a thousand pages of small print; today it runs into some 30,000 pages. What has incensed anti-WTO protesters most is the newly-invented concept of the ‘right’ to enter any foreign country, even if not needed, unwanted and uninvited, to invest and market there, and export and profit from there, all the while cutting down jobs and raising prices.

It is not enough for WTO that foreign investment is already allowed almost anywhere in the world, albeit with some conditions to protect the local citizens and enterprises, and especially food security. But the idea that foreign investors be treated under the same rules that were hitherto reserved for local business and industry was unheard of in the history of commerce, until the corporations thought it up as the “Most Favoured Nation” principle.

Since such investment is mostly a one-way traffic with richer, mainly northern, companies investing in poorer countries, there is no way that local companies can compete even in the local market or source credit to the same degree to be able to do so.

Then there is the agreement on Trade-Related Intellectual Property Rights (Trips), the key feature of which any peasant will understand with incredulity, once explained. In the 15,000 years of recorded agriculture that has existed, the millions of species in nature have never been considered anyone’s personal or company property. Farmers have always crossed different varieties of plants experimentally to obtain the best for subsequent planting, a long and slow process that took decades or generations.

It was through this ongoing process, without artificial means, that farmers effected changes in plants with improved genetic combinations. Today, there is not a single crop in the world used by humans that has not benefited from thousands of years of intervention by thousands or millions of anonymous farmers. But now, by simply juggling a gene or two in the laboratory, seed corporations claim to have ‘created’ something new and unique, and claim exclusive property rights to its use through patenting as conveniently defined by Trips, available to others only at a price. Corporations have already encroached on basmati, neem and turmeric.

Of course, small farmers do not have to use patented seeds having always used their own saved seeds. However, government policies favouring big farmers drove so many hundreds of millions of peasants into penury and off their lands, they could no longer continually re-grow from saved seeds. Commercial seed is now increasingly monopolized by multinational seed corporations, invariably requiring expensive accompanying inputs.

Most small farmers also tend to grow cash crops exclusively, although they could easily ensure food security by having part of their land fulfil their household food needs – as all big Pakistani farmers do, who do not want to eat hybrid seed produce. As hybrids covered more and more acreage, the thousands of displaced varieties began to go extinct. Consequently, local farmers are left only with patented seeds and inputs which the poor can’t afford. So they join the mass of migration to the urban areas while their land is swallowed up by agro-business or big farmers.

Today each cultivated food comes from only one or a few seed varieties. Soon, if the corporations are allowed to have their way, there may be just one or two seed varieties for every grown food item in the world, under patent, for which everyone will have to pay an additional price every time they eat. Or starve.

An inhuman example of monopolist power was the denial of low-cost generic versions of patented medicines even though Trips does allow production and export by others under compulsory licensing. But the drug companies want it all for themselves at their price. For example, South Africa imports cheap generic versions of Aids drugs from India, produced at a fraction of the corporate price.

It is either that or letting millions of Aids patients die, but the US pharmaceutical industry couldn’t care less. One drug for extreme mental stress is produced in a neighbouring country at one-fortieth the price that it is sold at by a multinational in Pakistan.

Corporations want minimum market access for each individual agricultural product they wish to export. At the same time, they want developing countries to reduce and phase out their domestic and export subsidies – although the EU and America refuse to reduce theirs. Many developing countries cannot even afford to give much or any; but given half a chance they may be able to in the future.

As if these problems were not enough, the General Agreement on Trade in Services (GATS) is on the agenda. Having exhausted all other areas of investment, WTO now seeks a final frontier in the services sector, mainly public services that have been traditionally the responsibility of governments to ensure essentials for survival or for a minimum standard of living accessible to all citizens.

Most public services require enormous infrastructure and investment for which no single investor or consortium would be forthcoming, especially since the consumer price has to be low and affordable, and the service provided on a non-profit basis or subsidized if need be. But because the world spends over a trillion dollars annually on water, twice that much on education, and $3.5 trillion on health care, it spells lucrative opportunities for corporations.

There are other areas as well covering the entire economy, such as telecommunications, utilities, tourism, public transportation, railway services, and other commercial services, much of which Pakistan offered up even before it was asked. To mop up what’s left, there is the demand for “Non-Agricultural Market Access” or NAMA, which applies to processed or manufactured goods.

Already the EU and the US together account for over half the world’s exports and imports of manufactures. What they get from developing countries is mostly semi-processed raw materials or assembly of finished goods, the key components of which are imported. The companies performing these tasks are either sub-contractors or subsidiaries of multinationals.

There is no such understanding as ‘transfer of technology” anymore. So, South industries that are still a long way from comprehensive production would not be able to develop further. Not everything non-agricultural is entirely non-agricultural either.


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About denebsumbul

Documentarian, Activist, Journalist, Photographer, Capacity Trainer
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