TRADE: Third World Tastes the Carrot and the Stick

By IPS Correspondents Reprint | | Print |

Abid Aslam

SEATTLE, Dec 2 1999 (IPS) - Third World trade ministers got a taste of the carrot and the stick Wednesday as US President Bill Clinton sought to nudge them toward a new round of negotiations under the World Trade Organisation (WTO).

Clinton had lunch Wednesday with delegates at the Nov 30-Dec 3 WTO ministerial conference and asked them to end their talks with agreement on “a new type of (trade) round that I hope will be about jobs, development and broadly shared pros perity.”

He supported plans to remove tariffs against all exports from the ‘least developed countries’ (LDCs) – a long-sought c oncession which involved only half a percent of worldwide exports.

He promised to loosen the US grip on medical patents to make “desperately-needed drugs” available to developing coun tries facing major health crises.

And he sought to soothe Third World fears over US motives in pushing labour and environmental issues.

However, he brushed aside Southern calls for comprehensive reviews of existing trade arrangements – as well as their c ontention that the US has protected its own industries while prying open overseas markets.

And he skirted politically prickly questions about new issues including biotechnology, logging and genetic patenting o f crops vital to small farmers’ livelihood.

The omissions were glaring, critics said, because delegates from developing countries had begun to complain that US ne gotiators were trying to intimidate them into supporting an expansion of the WTO’s ambit

Official and non-governmental sources close to key African delegates alleged Wednesday that US officials had threaten ed economic reprisals – including reduced aid – for countries blocking negotiations on new issues.

US officials were not available for immediate comment late Wednesday but a senior Western observer suggested that Sout hern delegates had confused American assertiveness with coercion.

Nevertheless, reports circulated Wednesday that Kenyan officials opposed to plant patenting and genetic engineering ha d been told that their position could adversely affect relations with Washington.

“The WTO is already run by and for developed nations and corporate bosses,” declared Ritchie Jones, Gambia-based hea d of an international food rights delegation fielded by the British charity Action Aid.

“Now, as poor countries struggle to survive against these powerful forces, the US dangles a small carrot in one hand and waves a big stick with the other.”

Other developing countries were less sympathetic. Several delegates from middle-income countries privately derided the LDCs as having “sold out” on key issues for a pittance – namely the zero-tariff promise, which Western countries had s aid they supported weeks ago and which involved little sacrifice on their part.

Western negotiators also locked horns with their counterparts from developing countries over the tricky issue of draft ing trade rules to require that poor nations improve wages and working conditions in their export industries.

Southern delegates complained that those not able to raise salaries would be vulnerable to punishment while those comp lying with the new standards would have been stripped of a key element of competitiveness: cheap labour.

Clinton, however, told ministers that “I do not want the United States or any other country, now or later, to be able to use (labour standards) as a shield for protectionism.”

The president admonished negotiators not to shun the issue but to “write the rules in such a way that people in our p osition, the wealthier countries, can’t do that, can’t use this as an instrument of protectionism.”

Third World diplomats remained sceptical – with some justification, according to UN Conference on Trade and Developmen t Secretary-General Rubens Ricupero.

“In the real world of trade, where the negotiators are very hard people…even the best of ideas have been distorted, ” Ricupero said, citing the example of anti-dumping abuses against developing countries.

He urged “rational dialogue” to build mutual confidence between the opposing sides.

Clinton, speaking on World AIDS Day – said the United States would loosen its enforcement of US drug company patents t o help developing countries fighting AIDS and other health crises.

“The United States will henceforth implement its health care and trade policies in a manner that ensures that people in the poorest countries won’t have to go without medicine they so desperately need,” Clinton declared.

This followed clashes with South Africa, where local manufacturers sought to make inexpensive generic versions of AIDS drugs or to import US medicines at lower prices from third countries.

“These statements are a real, much needed step forward,” said Zafar Mirza of the non-governmental Health Action Inte rnational.

“However, they need to be followed with actions…(including) support for countries’ efforts to introduce a public he alth orientation” in the WTO’s rules on intellectual property rights, Mirza added.

Clinton also earned mixed reviews for urging ministers to “put environment at the core of our trade concerns” – even as US trade negotiators pushed for the elimination of tariffs on forest products. Such a deal would increase logging and deforestation in ‘biodiversity hotspots’ such as Indonesia and Malaysia, environmentalists asserted.

The United States is a major exporter of forest products originating on its own soil and from overseas timber concessi ons held by US corporations. By pushing the logging agreement, US officials were “listening more to the timber industry than the environmental community,” said Andrea Durbin, international programme director at Friends of the Earth.

Clinton spoke as security forces made some 250 arrests during a second day of demonstrations against an expansion of t he WTO’s ambit. Downtown Seattle remained under a state of “civil emergency”.

The term ‘non-tariff barrier’ took on new meaning as city authorities banned the possession and use of gas masks, whic h protesters otherwise could use to restrict the free flow of police tear gas into their lungs.