The bluffer’s guide to… The WTO

The WTO? Not another governing body for boxing is it? Nope, it’s the World Trade Organisation. Oooh, that sounds grand. Tell me more. The WTO was set up in 1995 to replace the General Agreement on Tariffs and Trade (Gatt). Gatt was designed to reduce taxes on imports, but the WTO’s programme has greatly expanded […]

September 1, 2003
4 min read

The WTO? Not another governing body for boxing is it?

Nope, it’s the World Trade Organisation.

Oooh, that sounds grand. Tell me more.

The WTO was set up in 1995 to replace the General Agreement on Tariffs and Trade (Gatt). Gatt was designed to reduce taxes on imports, but the WTO’s programme has greatly expanded to include the removal of almost any restrictions placed on trade. Based in Geneva, the organisation governs international trade between 146 member countries. Every two years all member nations meet at a Ministerial Conference, which this year is in Cancun.

Sounds like a big international free trade love-in.

Hmm, not quite. Although the WTO is ostensibly democratic, the big boys from the US, Canada, Japan and the EU – known as “the Quad” – rule the roost. One developing country delegate at the 2001 Doha ministerial conference said: “If I speak out too strongly the US will phone my minister. They will twist the story and say I am embarrassing the US. My government will not even ask: “What did he say?” They would just send me a ticket home tomorrow.” The Quad meets several times a year to decide policy behind closed doors. Its decisions are then sold to less powerful governments.

What policy decisions are taken?

Official WTO policy can be summed up thus: anything deemed an obstacle to the pursuit of profit should be labelled an illegal barrier to free trade. But while liberalisation of markets is the stated aim, one north African WTO delegate said the Quad’s message to the less powerful was “you liberalise, we”ll subsidise”.

US agriculture is heavily concentrated in the hands of multinationals. High levels of subsidies were increased massively by the 2002 Farm Bill. Less developed countries don”t have the capital to subsidise their farmers. As Noam Chomsky said: “Nobody in the corporate world or government takes free trade seriously. The parts of the economy that are able to compete internationally are primarily the state-subsidised ones.”

But surely that’s a breach of WTO rules and the offending countries will be punished?

Hang on while I stop laughing. It’s one rule for the powerful and another for the rest. A Clinton administration spokesperson summed it up perfectly: “We do not believe anything the WTO says or does can force the US to change its laws.”

So the WTO is powerless then?

Not if you are a powerful state. Take the Agreement on Trade-Related Aspects of Intellectual Property Rights (Trips), which requires all WTO member countries to honour patent rules (including those relating to pharmaceutical products and processes), regardless of their levels of development or health needs. Trips allows 20-year market monopolies and restrictions on the measures countries can adopt to get access to cheaper medicines. Thus, many people in poorer countries are dying because of the exorbitant cost of drugs to treat diseases like HIV/Aids.

There’s also the General Agreement on Trade in Services (Gats), which creates a framework for foreign businesses to turn basic necessities like water, health and education into commodities. Earlier this year, WTO members submitted their initial lists of the services that they would like, and would agree to being, liberalised. Cancun will see a round of stock taking.

According to the EU, Gats is “first and foremost an instrument for the benefit of business”. In other words, Gats intensifies that old capitalist principle: if you can”t pay, you don”t get.

I’m not sure I like the sound of the WTO.

You”re not alone. Mass protests at the 1999 Seattle ministerial gave the WTO a global profile. The UN said the organisation’s unbalanced and inequitable approach to trade liberalisation, non-transparent procedures and inattention to the human rights implications of trade policy meant that it is a “veritable nightmare” for large parts of the world – particularly developing countries. Roll on Cancun.

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