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TWN Info Service on WTO Issues (Mar03/5)

30 March 2003

Dear friends and colleagues

NGOs CALL ON GOVERNMENTS TO DROP INVESTMENT ISSUE AT WTO CANCUN MEETING

More than 50 NGOs and social movements have called on WTO member governments to drop any proposals or plans to launch negotiations on a new investment agreement during the Cancun Ministerial Conference in September this year. They also asked the governments to also reject launching negotiations on the other “new issues” or “Singapore issues” (competition policy, transparency in government procurement and trade facilitation).

The calls were made in a Joint Declaration of NGOs and Civil Society Movements on “No Investment Negotiations at the WTO.”

The Declaration was first drawn up at a NGO Workshop on the WTO Investment Issue held in Geneva on 18-21 March 2003.  It was organised by the Third World Network, Oxfam International, WWF, Public Services International, Centre for International Environmental Law, Institute for Agriculture and Trade Policy.

After the workshop, the Declaration has been circulated to other NGOs and movements, and more groups have been signing on.

The Declaration was also released at a media conference held in Geneva on 21 March.   It will also be sent to the Missions of the member governments of WTO.

Below please find the following:

1.   The Declaration.

2.   An article by Reuters news agency on the press conference.

3.   An article in the SUNS (South-North Development Monitor) on the press conference.

With best wishes

Martin Khor and Goh Chien Yen

Third World Network

NOTE:    NGOs and social movements that would like to sign on to the statement can contact the organisers at the following email:  stopthenewissues@hotmail.com

 

NO INVESTMENT NEGOTIATIONS AT THE WTO

Declaration of Non Governmental Groups and Civil Society Movements

We, members of civil society organizations from developing and developed countries, explicitly reject the launch of negotiations on investment and the other Singapore Issues at the Ministerial Conference in Cancun this September.

We have gathered from a broad spectrum of civil society groups, including groups working on development, environment, faith-based, social, labor, human rights, food security, gender, and rural and indigenous community issues. We have met over four days in Geneva in the shadow of global conflict and have reached the following conclusions.

Previous attempts to negotiate a multilateral agreement on investment, including the failed Multilateral Agreement on Investment (MAI), have been criticized by civil society around the world as overly focused on investor protections and for failing to adequately address poverty reduction, sustainable development, and corporate accountability and liability.

Discussions to date within the WTO’s Working Group on the Relationship between Trade and Investment indicate that some WTO Members such as the EU, US and Japan are similarly focused almost exclusively on granting greater rights to transnational investors to hold themselves above national decisions on development priorities, macroeconomic policy, environmental directives, and implementation of international human rights law and norms.

Foreign direct investment can make a positive contribution to sustainable development when undertaken within a strong regulatory framework that will maximize the benefits and minimize the costs of investment.  Most, if not all, developed countries have made use of policy tools, such as performance requirements, to ensure that incoming investment would help to develop infant industries, enhance export capacities, and promote inward technology transfers, and yet many developed countries now seek to “kick away the development ladder” by denying developing countries the right to use identical policies.

Existing international investor protection rules in the North American Free Trade Agreement (NAFTA) and hundreds of bilateral investment agreements, as well as in provisions in contracts and loan agreements, are being used to challenge and seek compensation for governmental actions that are essential to achieving a just and sustainable future.  This is a problem that affects both developing and developed countries.  The filing of new claims by corporate investors in international arbitration is increasing at an alarming rate.

While the threats to regulatory prerogatives of governments is clear, there is little if any empirical evidence that adopting the types of investor protection rules being discussed at the WTO and negotiated in the Free Trade Area of the Americas and elsewhere will lead to any increase in the amount or quality of investment flows.

The WTO is the wrong forum for global investment talks.  Moreover, the WTO is in the midst of a crisis as it is not making progress on issues of fundamental importance to developing countries and many other constituencies.  Moreover, adding the Singapore issues (investment, competition, transparency in government procurement and trade facilitation) to an already crowded agenda will prevent the WTO from undertaking the reforms and rebalancing necessary.

Finally, WTO negotiations on investment and the other Singapore issues would result in rules that developing countries in particular do not need and cannot afford.

Therefore, we call upon the Members of the World Trade Organization to:

·        Explicitly reject the launch of negotiations on investment and the other Singapore Issues at the Ministerial Conference in Cancun this September,

·        Reject the NAFTA/MAI approach to investment liberalization.

Signatories:

·        Third World Network, Malaysia

·        Center for International Environmental Law

·        Oxfam International

·        Institute for Agriculture and Trade Policy, US

·        World Wide Fund for Nature, International

·        Public Services International

·        Congress of South African Trade Unions (COSATU), South Africa

·        Greenpeace International

·        World Development Movement, UK

·        World Economy, Ecology and Development (WEED), Germany

·        INESC, Brazil

·        Berne Declaration, Switzerland

·        Institute for Global Justice, Indonesia

·        Gender and Economic Reform in Africa (GERA)

·        Third World Network, Africa, Ghana

·        Africa Trade Network

·        International Gender and Trade Network

·        The Norwegian Forum for Environment and Development, Norway

·        Action Aid

·        The Network for Consumer Protection, Pakistan

·        Transform India Group, India

·        Society for Conflict Analysis and Resolution, India

·        The Danish NGO Coalition (The 92 Group), Denmark

·        Women and Development, Denmark (KULU)

·        Friends of the Earth, Netherlands

·        Swiss Coalition of Development, Switzerland

·        Campagna - per la Riforma Della Banca Mondiale, Italy

·        Centro para la Denfensa del Consumia, El Salvador

·        REBRIP, Brazil

·        Bisan Center for Research and Development, Palestine

·        Consumers Association of Penang, Malaysia

·        Friends of the Earth Malaysia

·        World Forum of Fish Harvesters and Fishworkers

·        Coalition of the Flemish North-South Movement - 11.11.11., Belgium

·        Instituto del Tercer Mundo (ITeM), Uruguay

·        Global Exchange, US

·        Focus on the Global South

·        Friends of the Earth, England, Wales and Northern Ireland

·        Hemispheric Social Alliance

·        Red Accion Ciudadana Frente al Comercio e Inversion (SINTI TECHAN) de El Salvador

·        California Coalition for Fair Trade and Human Rights, US

·        Caribbean Reference Group on External Relations

·        Centre du Commerce International pour Le développement, Guinea

·        Enda Tiers Monde, Senegal

·        Public Citizen, USA

·        EcoNews Africa, Kenya

·        Solon Foundation, Bolivia

·        Arab NGO Network for Development (ANND), Lebanon

·        Trocaire East Africa, Kenya

·        Social Development Network (SodNet), Kenya

·        Institute of Economic Affairs, Kenya

·        RODI Kenya (Trade Policy Programme)

·        Kenya National Farmers Union

·        Friends of the Earth Finland

·        Institut de recherches de la FSU, France

·        Center of Concern, US

·        U.S. Gender and Trade Network,

·        African Women’s Development and Communications Network (FEMNET), Kenya

·        Initiative Colibri, Germany

·        Sindicato Estadual dos Profissionais da Educação do Rio de Janeiro

·        Red Mexicana de Accion Frente al Libre Comercio, Mexico

·        Centre du Commence International pour le Developpement (CECIDE), Guinee

·        IRDF - Integrated Rural Development Foundation, Philippines

·        Asia Pacific Network on Food Sovereignty [APNFS]

·        RCPD -Resource Center for People’s Development, Philippines (As of 27th March 20, 2003)

NOTE:   This statement was initially prepared and signed by more than 40 organisations from around the world which participated at a NGO workshop on “Briefing and Update on WTO Negotiations on  Investment and New Issues” in Geneva, Switzerland from 18-21 March 2003.  More NGOs have been signing on after that.

Reuters Article

Campaign groups aim to stop WTO investment pact

Geneva, March 21 (Reuters)- Global campaigning groups said on Friday they would try to stop a World Trade Organisation (WTO) pact stating common rules for foreign investment, arguing it would undermine poor economies.

Representatives of some of the more than 50 organisations joining the effort said they would lobby governments, especially in Europe, against a proposed accord that would be a potential ‘Bill of rights for transnational corporations’.

Projects for a pact tabled at the WTO by the European Union and Japan- its main champions in the 145 member body- could provide big firms with a weapon of economic mass destruction, one prominent figure in the campaign said.

‘These proposals are very one sided’, Martin Khor of the Malaysia-based Third World Network told a news conference.

‘They are not aimed at regulating investment but to regulate governments so that they can’t regulate investments.’

Supporters of an agreement, who include some Latin American countries as well as rich powers where major global companies are based, say clear rules on the treatment of foreign investment that all WTO countries could have to observe would help poor countries attract more capital and so boost development.

But Peter Hardstaff of the British-based World Development movement said a WTO pact along the lines suggested by the EU and Japan ‘would prevent governments in developing countries steering foreign direct investment towards development targets’.

The United States is in public lukewarm about the idea, but EU Trade Commissioner Pascal Lamy- and the French and British governments’ –is pushing it strongly, the campaigners said.

Ordinary peopled hit

Raul Moreno from a Latin American co-ordinating group and Bokary Fofana from another in Africa said ordinary people in both regions had seen their livelihoods badly hit by outside investment projects aimed primarily at making quick profits.

Governments must keep the right to decide where investment should go and how profits could be moved abroad, they added.

Celine Charveriat of the International development charity OXFAM said World Bank studies had shown there was no evidence that such an Agreement would bring any more or better quality investment flows into developing countries.

The EU and Japan are driving hard against strong scepticism in many poorer states, for a decision at a key WTO meeting in Cancun, Mexico in September, to launch talks on a pact.

The aim would be for these to be incorporated into the current Doha round talks on lowering tariffs and other barriers to global trade in goods and services- all to be wrapped up in a single-package accord by the end of 2004.

The campaigners said they would mount demonstrations against the plan at a summit of the Group of Eight industrial nations in Evian, France, in June as well as at Cancun and at a meeting on a free trade pact for the Americans in Miami in November. © 2003 Reuters Limited

Trade: NGOs say ‘no’ to investment agreement at WTO

(Article in SUNS, South-North Development Monitor, 24 March 2003)

Geneva, 21 Mar (by Kanaga Raja) -- A group of more than 50 NGOs and social society movements from developed and developing countries has called for the rejection of the launch of negotiations on an investment agreement at the next  WTO Ministerial meeting in Cancun in September.

The group made this call when they gathered here Friday to launch a new campaign against investment negotiations at the WTO.

The NGOs and social movements contend that instead of promoting sustainable development, the WTO negotiations on investment, promoted by the EU, the US and Japan, will create a global bill of rights for TNCs and infringe upon government’s right to regulate the entry, operation and exit of foreign investors for development purposes.

The Group argues that while FDI can make a positive contribution to sustainable development, it can also lead to foreign exploitation with TNCs enjoying many rights and making huge profits at the expense of workers’ salaries, local firms’ capacity to survive, environmental protection and macroeconomic stability.

Most, if not all, developed countries have made use of policy tools to ensure that incoming investment would help to develop infant industries, enhance export capacities, and promote inward technology transfers.

Yet, say the NGOs, many developed countries are now seeking to “kick away the development ladder” by denying developing countries the right to use identical policies.

Moreover, despite claims by the EU, there is no empirical evidence that an investment agreement would lead to increased quantity or quality of FDI going to developing countries, the group notes.

The group also released a declaration explicitly rejecting the launch of negotiations on investment and other Singapore issues at the WTO Cancun meet. The group argued that the WTO is the wrong forum for global investment talks and adding the Singapore issues to an already crowded agenda will prevent the WTO from undertaking the reforms and rebalancing necessary.

The group calls for WTO members to:

·        Explicitly reject the launch of negotiations on investment and the other Singapore issues at the Ministerial Conference in Cancun this September;

·        Reject the NAFTA/MAI approach to investment liberalization.

Peter Hardstaff of the World Development Movement and S2B network, a loose coalition of groups in Europe, said that they were opposed to the proposed investment agreement and the EU plan at the WTO to expand the GATS into other sectors like mining, agriculture and fisheries.

According to Martin Khor of Third World Network, the most important decision in Cancun is whether there is an explicit consensus among WTO members on starting negotiations on investment. However, so far there has been no sign of consensus due to some contentious issues in the negotiations. There was no time between now and Cancun in September to reach consensus even on modalities, which is the most important part of any negotiations.

Khor said the NGOs from the South are opposed to an agreement which would be “very one-sided” by disciplining governments from regulating investment, allow investors to transfer funds out easily, and would have measures on expropriation mechanisms similar to those in the NAFTA agreement.

Any investment agreement along the lines mooted by the EU and Japan will severely prevent governments from undertaking positive investments geared towards development. The WTO had other important items on the agenda - like agriculture, special and differential treatment and implementation - that have not been resolved yet and these had already missed their deadlines.

Just to be able to cope with these issues was proving difficult and the rush to negotiations on the new issues will cause the trading system to be overloaded, Khor warned.

Also, while an investor-to-state dispute mechanism will intensify opposition to an investment agreement, this was not really the biggest issue. The major point over which the NGOs took issue, was the one-sidedness of the investment agreement. It will tilt the balance against the host country governments just as the TRIPS agreement had done in favour of holders of IPRs.

Ms Celine Charveriat of Oxfam International said the NGOs are launching the campaign so that negotiations for an investment agreement would not be launched in Cancun in September. The groups would also be mobilizing for the G8 summit in Evian in June to bring this message across.

Asked about the Iraq war and its effect on the negotiations for an investment agreement, Khor hoped that there would be no agreement due to the war. However, he noted, the industrialized countries are quite serious about moving the negotiations forward, judging by a recent EU paper on modalities and EU Trade Commissioner Pascal Lamy’s apparent keenness as well.

Khor said if negotiations were to be launched on the new issues and new agreements as proposed by its proponents ensue, then the results will be very damaging for the South, and the new agreements could perhaps constitute “instruments for economic mass destruction.”

“We urge WTO members to reject plans for a new WTO investment agreement. A decision to launch negotiations at Cancun would put the nail on the coffin of the Doha Development Round,” said Oxfam’s Charveriat.

 


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