TRADE-DEVELOPMENT: Mandela Tells WTO To Bridge North-South Gap

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Shada Islam

GENEVA, May 19 1998 (IPS) - South African president Nelson Mandela Tuesday called on the World Trade Organisation’s 132 members to forge a “partnership for development through trade and investment.”

Attempting to bridge a yawning north-south divide within the WTO on the future direction of global trade — and continuing disagreement on the achievements of the last fifty years of the multilateral trading system — the South African leader said that t he agency must ensure that world trade is put at the service of development.

“Trade does not of itself and by itself bring a better world,” Mandela told the WTO meeting. “The extent of benefits that trade brings will depend on how we shape the process,” he warned. “This requires wise work to be done.”

Earlier Cuban president Fidel Castro said the WTO agenda had been hijacked by rich nations, while poorer countries were being denied access to markets in the north.

“New subjects introduced in the WTO by rich countries have resulted in a reduction in the competitive advantage of developing countries,” the Cuban leader said, adding that new ideas being promoted by Western nations would be inevitably used as “prete xts for non-tariff barriers”.

“Third World countries have been losing everything,” Castro told the WTO. “How are we supposed to make a living? What goods and services shall we export ? Which industrial production will be left to us?”

Castro warned that multinational firms from the north were turning developing nations into an “immense free zone of assembly plants that do not even pay taxes.”

The Cuban leader’s bleak assessment of the last fifty years of the multilateral trading system contrasts with the upbeat evaluation of global trade given by both the United States and the European Union.

U.S. President Bill Clinton insisted in a speech to the WTO that world trade had created prosperity worldwide. “This dynamic, idea-based new global economy offers the possibility of lifting billions of people into a worldwide middle class,” he said.

“Globalisation is not a policy choice — it is a fact. We can work to shape these powerful forces of change for the benefit of our people,” Clinton added. “Or we can retreat behind the walls of protection and get left behind in the global economy.”

British prime minister Tony Blair, the current holder of the presidency of the European Union, told the WTO that the “irreversible and irresistible trend” towards free trade was unstoppable.

“It is hard to conceive of a return to the full-blown protectionism and strangulation of trade which disfigured the 1930s,” he added. But, the danger of “subtle forms of protectionism” remained and “pressures rise in a crisis,” Blair warned.

Much of the friction in Geneva has been over EU and U.S. demands for a new round of world trade talks. A declaration to be adopted by WTO countries on May 20 commits the agency to launching new market-opening discussions on January 1, 2000 — at a minist erial meeting that Clinton has promised to host in the United States.

The talks, according to the ministerial declaration, will focus on liberalising markets but will be “sufficiently broad-based to respond to the range of interests and concerns of all its members”.

While many developing countries remain reluctant to embark on such talks, fearing that there will be pressure on them to make even more concessions, South Africa’s Nelson Mandela told the meeting that countries in the South must “now give leadership to the development of a positive agenda to fully address their needs”.

Developing nations must “precisely define those areas that are obstacles to their progress in the world trading system,” he urged. “There can be no refusal to discuss matters such as labour standards, social issues and the environment”.

But Mandela warned Western countries that they must also be ready to listen to developing countries’ demands for improvements in the WTO’s treatment of sectors such as textiles and agriculture. “If developing countries feel that they have nothing to gai n except further burdens, then it will prove difficult to deal with these crucial matters,” he insisted.

In turn Clinton made it clear in his speech that the U.S. would be pushing for closer attention to environmental and social issues in the new trade talks. He told the WTO that Washington wanted a high level meeting between world trade and environment min isters “to provide strong direction and new energy to the WTO’s environmental efforts”.

Also, “the WTO and the International Labour Organisation should commit to work together to make certain that open trade lifts living conditions and respects the core labour standards that are essential not only to workers’ rights but to human rights eve rywhere,” Clinton said.

International labour groups have welcomed Clinton’s focus on labour standards, saying they are now confident that the issue will be part of the new global round. “The labour agenda has been thrust to the fore,” Bill Jordan, general secretary of the Int ernational Confederation of Free Trade Unions (ICFTU) commented.

The ICFTU, which represents labour groups across the globe, and has been campaigning for a so-called ‘social clause’ in the WTO for several years, said the WTO could no longer avoid closer cooperation with the ILO on ending labour abuses.

“We need to talk about procedures,” insisted Stephen Pursey, the ICFTU’s chief economist. Once the ILO had exhausted its efforts at getting erring countries to reform their ways, labour abuses should be handed over to the WTO, he said.

But Martin Khor of the Penang-based Third World Network said he was not convinced of the need for a trade-labour link: “We shouldn’t open the issue again. A discussion of labour standards will overload the WTO system and cause developing countries a lot of problems.”

In a report published to coincide with the 50th anniversary celebrations of the multilateral trading system, the WTO said that successive trade-liberalising trade rounds had led to a 90 percent reduction in world tariffs and a fifteen fold expansion in w orld trade.

But, WTO officials said it was crucial now that moves to create regional trade blocs did not stunt further growth of the multilateral trading system.