THE FIFTH MINISTERIAL MEETING OF THE WORLD
TRADE ORGANIZATION
will be held September 10-14, 2003 at Cancun, Mexico.
A Global Inequality
(Compiled by the Center for Concern and used with their permission)
What is the World Trade Organization (WTO)? This organization was set up
in 1995 and decides the rules that govern international trade, the General Agreement on
Tariffs and Trade (GATT). Its major aim is to promote free trade and investment by
outlawing import taxes, subsidies to domestic producers, and other practices that hinder
the free flow of goods and money. The countries of USA, Italy (also as European Union),
Brazil, and Senegal have been members since the beginning, with differing levels of
influence and representation.
The World Trade Organization (WTO) has more than 140 members, accounting for over 97% of
world trade. In theory, all members are equal. However, the rich countries, especially The
United States, European Union, Japan and Canada, have well-funded teams of specialist
negotiators, while half of the poor countries in to the WTO cannot afford even one
representative at WTO Geneva headquarters. The world's largest multinational companies
also have expensive lobbying operations to further their business interests. So, WTO rules
work in the interests of the rich for most part. (also read: Globalization: the Players)
One of the efforts being launched for the Cancun meeting is to regulate further the
international flow of investment by passing a Multilateral Investment Agreement (MIA) This
would add to investor rights while taking away from investor responsibilities. In
particular, it would forbid countries from giving preferential treatment to companies that
are socially responsible or that protect the environment and even allow investors to sue
governments when laws harm a company's profits, for example environmental or health laws.
In the ‘90's, worldwide protest scuttled a similar proposal called the Multilateral
Agreement on Investments, or MAI.
Some agreements of the WTO have already placed some restrictions on investment. For
example, WTO's Agreement on Trade-Related Investment Measures (TRIMS) prohibits countries
from being able to regulate foreign direct investment in order to get a good economic deal
for its citizens such as requiring foreign investors to buy some components locally,
sharing technology with host country's workforce and requiring the hiring of a percentage
of workers from the host country. This regulation hits local business hard; for example,
the Brazilian car industry began to use more imported components, killing jobs. Also, some
local component makers were bought up by foreign companies, which moved research and
development out of Brazil.
Advocate with your country's World Trade representatives to oppose the Multilateral
Investment Agreement and to change the TRIMS agreement to allow for host countries to
regulate foreign investment.
Address: World Trade Organization
rue de Lausanne 154
CH-1211
Geneva 21, Switzerland
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