Same formula, same medicine, different chemist

Supachai Panitchpakdi of Thailand, who is due to assume the office of WTO Director-General in September, will be the first developing-country national to head the world trade body. While much will doubtless be made of this fact, the appointment of the free-trader will nevertheless be no blessing to those championing fundamental reform of the multilateral trading system.

by Aziz Choudry

CHRISTCHURCH (NEW ZEALAND): It might not quite be a case of Pete Townshend’s “meet the new boss, same as the old boss.” But the change of guard at the World Trade Organization later this year is unlikely to make any real difference to developing countries suffering under corporate globalization.

On 20 December last year, the Thai delegation distributed a letter to the WTO General Council confirming Thailand’s former Deputy Prime Minister Dr Supachai Panitchpakdi’s commitment to taking up the post of Director-General of the WTO on 1 September after Mike Moore steps down. According to some Indian media reports, rumours had been circulating late last year that Supachai was no longer interested in the WTO post and was thinking of returning to Thai politics.

In July 1999, the General Council, the WTO’s highest-level decision-making body, had announced a job-share arrangement to split the six-year tenure of the Director-General, after a bitter race for the position between Dr Supachai and New Zealand’s Moore.

The first chief of GATT (General Agreement on Tariffs and Trade, the WTO’s precursor) or the WTO (or the International Monetary Fund and the World Bank, for that matter) to come from a non-OECD country, Supachai’s term will run until 31 August 2005.

Before the job-share deal was reached, I had wondered if Supachai would get the nod over Moore. What better way to try to boost the WTO’s credibility - and the model of economic development that it promotes - than by putting a Thai at the helm? The Thai government saw his possible appointment as a way to repair the country’s tarnished international image as the birthplace of the economic crisis in 1997 following the collapse of the baht.

Worldwide, many in the free-trade brigade had held up South-East Asia’s “tiger” and “tiger cub” economies as ‘proof’ of the benefits of economic liberalization and the success of free-market economies. In 1998, at the start of the WTO leadership race, they were still in damage-control mode, trying to explain what had happened in terms that did not challenge the tenets of their own economic fundamentalism - lest people question their beloved model.

Supachai’s appointment then could have been a potent symbol and signal that all was well with the global free-market economy at a time when many people were acutely seeing the opposite to be true. But of course, Moore took the position in September 1999.

Pro-free trade

Almost three years later, I am sure that much will be made of the fact that Supachai is from a Third World country. But perhaps for somewhat different reasons.

Supachai, who turns 55 this year, has a PhD in Economic Planning and Development from Erasmus University in Rotterdam. Now internationally recognized as an expert in economic development, his professional career began in the Bank of Thailand in 1974, where he worked until running for office in 1986.

He served as Thailand’s Deputy Finance Minister from 1986-1988. He was President of the Thai Military Bank from 1988-1992. He was Deputy Prime Minister in Chuan Leekpai’s Democratic Party (Prachathipat) government from 1992-1995, responsible for economic affairs and international trade.

Supachai was in charge of Thailand’s participation in the Uruguay Round of the GATT, including its subsequent ratification and implementation. He also played a significant role in regional trade and investment liberalization initiatives like the APEC (Asia Pacific Economic Cooperation) forum and AFTA (ASEAN Free Trade Area).

From 1997 to last year he was Deputy Prime Minister and Minister of Commerce. He has chaired several Thai corporations and had a stint chairing Thailand’s Chamber of Commerce.

European Union Trade Commissioner Pascal Lamy predicts that while Moore already had a constituency in the developed world and has therefore spent a lot of his time with developing countries,  Supachai will have to spend considerable time getting to know the OECD countries in his term at the WTO.

In spite of his offers to be an “ambassador” for small countries at the WTO, Moore has irritated many Third World governments by his consistent unwillingness to listen to their concerns about the impacts of trade and investment liberalization on their countries, and his highly partisan championing of a new round of trade talks while holding a position which requires him to remain neutral.

Supachai has branded himself as a representative of developing countries in the WTO, a voice for the trade body’s have-nots. India’s Financial Express recently described him as “courteous to a fault.”  He has taken a number of swipes at the “do as I say, not as I do” approach by some of the developed countries in multilateral trade negotiations: the “I tell you to open up your market, I tell you to be more liberalized, I tell you to reform your legal provisions but what I do is different, must be a thing of the past,” he told Reuters in December.

“Rich countries,” he says, “must pay attention - not just lip service - to the plight of less developed countries.”

But before anybody starts cheering, we should realize that while he may not be a neoclassical economist, Supachai is a strong supporter of free trade. Last November he described China’s accession to the WTO as a “wake-up call ... a challenge” to South-East Asian economies to deepen domestic wholesale economic reforms, “because now the competition is at the front door.”

In an interview with Earth Times News Service at Doha, he said: “My mission is to see to it that we widen the number of countries that can benefit from trade liberalization.” His view is that the countries that have had the most success are “those that have globalized the most.”

Speaking to the Bangkok Post (22 November 2001), he described September 11 as a “blessing in disguise.” He said that it heralded a shift in the attitude of developed countries towards the South, and a toning-down of the anti-globalization movement.  “I believe this is going to be a long-term shift in the attitude of advanced nations while the anti-globalization process will also be in some kind of disarray for a while.”

Meanwhile, he promises to create an accreditation system for “reasonable NGOs” (those guys again!), saying that the WTO should not ignore them.


At a time when we need to revitalize our campaigns to delegitimize and oppose the WTO before the next Ministerial meeting, which could be held as soon as mid-2003, we must be very sceptical about any arguments that suggest that somehow Supachai’s Director-Generalship may herald a change in direction for the WTO and the multilateral trade system.

This point was reinforced to me on a November visit to Thailand. When I went from Moore’s - and my - hometown, Christchurch, to Supachai’s Bangkok, I was struck by parallels between the two countries as they embrace the free market.

While we marched against the WTO in New Zealand on 9 November, just before I went to Thailand, at the same time over 1,500 Thai farmers, unionists and HIV/AIDS activists marched on the US Embassy in Bangkok. The demonstration called for the WTO to get out of agriculture and an end to the patenting of life and drugs.

Also present at the Bangkok anti-WTO protest were unionists from Thai International protesting at the restructuring and further privatization of the airline. Privatization was a key condition of the IMF’s US$17.2-billion aid package to bail out Thailand after the 1997 crisis, caused largely by financial liberalization.

At a roundtable session with independent trade unionists and labour activists, State Railway Workers Union of Thailand officials asked me about the effects of privatizing New Zealand Rail on communities and workers. Rail privatizations in New Zealand, Britain and Australia have been held up as success stories to sell the idea in Thailand.

Many Thais are already painfully aware of what comes with privatizing state-owned assets - mass layoffs, higher prices and less access to public services for the poor - in a country where there are no social safety nets.

In Bangkok I canvassed opinions from unionists, academics, journalists and others about Supachai and the WTO. One unionist told me that having a Thai as the figurehead of the WTO would make no difference at all to Thailand or the rest of the Third World.

“He will just be a puppet for the powerful countries like the USA” which dominate the WTO, he said. A researcher described Supachai as a “smooth operator” -  a far more polished performer than Mike Moore - and therefore perhaps more dangerous.

For those of us who see the outcome of Doha as further proof of the WTO being a vehicle to advance the interests of global capital and the powerful governments which dominate the negotiations, who often resort to high-handed, bullying negotiating tactics (what’s new?), we cannot fall into a trap believing that a change of face will really make any difference.

The institution remains the same, and the WTO agenda, along with that promoted by the Bretton Woods institutions, is unchanged. Once again (and as the free-traders continue to try to milk the post-September 11 situation for all it is worth in pursuit of further and faster liberalization), the battle is on to stop the expansion of the WTO and prevent a new trade round.

We must not be distracted by the spin that will inevitably accompany Supachai’s three-year term, nor his statements of concern for the developing world. The words may be slightly different, but Supachai will be singing the same tune as his predecessor. (SUNS 5067/TWN Features)

Aziz Choudry is with GATT Watchdog, New Zealand

From TWE No. 275 (15-28 February 2002)