African and other developing countries defended their interests more assertively at the first ministerial meeting of the World Trade Organization (WTO) than they had been able to only three years ago, when the organization was formed. Having had little voice in the discussions that originally shaped the WTO, many of these countries are questioning or resisting efforts to extend the organization's scope beyond strictly trade issues, but with only partial success.
At the meeting in December in Singapore, the developing countries' Group of 77 (G-77) succeeded in its primary goal of blocking an initiative to link labour issues with trade agreements, at least for the foreseeable future. In opposing the US-led drive to make trade agreements contingent on higher labour standards, developing countries argued that such an arrangement could be used in a protectionist manner to deprive them of their low-wage advantage in the global market. Several countries, Egypt and Tanzania among them, adamantly opposed any mention of labour standards in the ministerial declaration.
In a compromise, WTO member states' support for core labour standards, such as the right to organize, was affirmed, but the use of trade measures to enforce such standards was definitively rejected. The International Labour Organization, rather than the WTO, was designated the competent body to set and monitor the standards. The US nevertheless expressed satisfaction that even the word "labour" showed up in the official pronouncements of a multilateral trade organization.
Concern over linkage
The industrialized countries made greater headway in introducing other non-trade issues, however. With a WTO working group continuing to discuss environmental questions and other working groups newly established at Singapore on corruption and international investment, developing countries are wondering how far the organization's reach will be extended. The wide range of social and economic issues being introduced to the WTO agenda, at a time when leading developed countries are pushing for a "streamlined" UN with a narrower mandate, is raising unsettling questions about perceived efforts to transfer substantive global decisionmaking away from the UN.
Despite opposition from several developing countries, of which a significant number were African, the Singapore meeting decided that a WTO working group will investigate international investment, possibly leading to a new worldwide arrangement which would bring down national barriers to direct investment in a manner similar to that by which the Uruguay Round liberalized trade (see Africa Recovery, December 1996, pages 22-23).
A G-77 effort to give least developed countries (LDCs) zero-tariff access to developed country markets was defeated. However, a separate WTO declaration on helping LDCs and a follow-up high-level meeting were endorsed.
Developing countries succeeded in retaining in the Singapore ministerial declaration a call for accelerating tariff reductions in the textile sector, to the benefit of their own export opportunities. But this victory also was defensive, merely salvaging language urging tariff-reduction measures already agreed to in the Uruguay Round, despite opposition from Canada and the US. Earlier expectations that the ministerial conference would devote significant attention to developing countries' problems in implementing the Uruguay Round trade agreements did not materialize.
Significantly, the most forthright agreement to emerge from Singapore – an International Technology Agreement (ITA) committing signatory countries to eliminate tariffs on telecommunications and information-processing products and services by the beginning of the year 2000 – was negotiated without any involvement of developing countries and outside the preparatory process for the ministerial meeting. Initial talks, in fact, involved only the "Quad countries": the US, Canada, Japan and the European Union (EU).
The G-77 countries' anxiety that a small number of countries could negotiate an agreement with such global implications was not eased when US trade representative Charlene Barshefsky remarked that the ITA established the principle that "major trade libe ralization can occur through the WTO without governments having to call for a global round of trade negotiations."
The concern among developing countries over such initiatives was echoed in an opening-day speech by Mr. Rubens Ricupero, Secretary-General of the UN Conference on Trade and Development (UNCTAD). Stressing the need to "define the natural frontiers of the trade system in a globalized world economy," he warned that "pressures to use the WTO as an instrument to deal with non-trade objectives, in short as a powerful device for global governance," may have destabilizing consequences.