BOX 1: Trade must benefit the developing world, says UN Secretary-General The following are excerpts from the address prepared by UN Secretary-General Kofi Annan for presentation at the opening ceremony of the World Trade Organization (WTO) meeting in Seattle on 30 November. Because of the disruptions caused by the anti-WTO protests, the opening ceremony did not take place and the speech could not be delivered directly to the delegates. In the past, developing countries have been told time and again that they stand to benefit from trade liberalization, and that they must open up their economies. They have done so, often at great cost. For the poorest countries, the cost of implementing trade commitments can be more than a whole year's budget. But time and again, they have found the results disappointing -- not because free trade is bad for them, but because they are still not getting enough of it.... They found that rich countries had cut their tariffs less than poor ones. Not surprisingly, many of them feel they were taken for a ride. Industrialized countries, it seems, are happy enough to export manufactured goods to each other, but from developing countries they still want only raw materials, not finished products. As a result, [industrialized countries'] average tariffs on the manufactured products they import from developing countries are now four times higher than the ones they impose on products that come mainly from other industrialized countries.... "It is hardly surprising if developing countries suspect that arguments for using trade policy to advance various good causes are really yet another form of disguised protectionism." -- UN Secretary-General Kofi Annan So it is hardly surprising if developing countries suspect that arguments for using trade policy to advance various good causes are really yet another form of disguised protectionism.... What is needed is not new shackles for world trade, but greater determination by governments to tackle social and political issues directly -- and to give the institutions that exist for that purpose the funds and the authority they need. The United Nations and its specialized agencies are charged with advancing the cause of development, the environment, human rights and labour. We can be part of the solution.... But this meeting and this organization must not be distracted from their vital task -- which is to make sure that this time a new round of trade negotiations really does extend the benefits of free trade to the developing world. Unless we convince developing countries that globalization really does benefit them, the backlash against it will become irresistible. That would be a tragedy for the developing world, and indeed for the world as a whole.

BOX 2: African NGOs reject new round of trade talks Prior to the World Trade Organization (WTO) ministerial conference in Seattle, 20 African social movements, environmental groups, trade unions and other civil society organizations issued a statement in September 1999 calling for a moratorium on any new round of trade negotiations and for an in-depth review of the impact of existing international trade agreements. The following are excerpts: We are opposed to any attempt to expand the powers of the WTO through a new comprehensive round of trade liberalization. Instead, governments should review and rectify the deficiencies of the system and the WTO regime itself, as part of the ongoing processes within the WTO. The Uruguay Round agreements and the establishment of the WTO were proclaimed as a means of enhancing the creation of global wealth and prosperity and promoting the well-being of all people in all member states. In reality, however, in the past five years the WTO regime has contributed to the concentration of wealth in the hands of the rich few, increasing poverty and indebtedness for the majority of the world's population, and [promoting] unsustainable patterns of production and consumption. Those governments that dominate the WTO and that, together with the transnational corporations, have benefited from the WTO system have refused to recognize and address these problems. Instead, they are pushing for further liberalization through the introduction of new issues for adoption in the WTO. On proposals to pressure countries to further cut industrial tariffs, we wish to state that African countries have already drastically reduced their tariffs (especially under structural adjustment programmes) and this has led to closure of local enterprises and de-industrialization. The WTO should not be used to lock in and further reduce industrial tariffs in Africa and the South. We thus reject another round of industrial tariff cuts. Instead, the North should cut its tariff peaks in products exported by the South. We call for a moratorium on new issues and further negotiations that expand the scope and power of the WTO. During the moratorium, there should be a comprehensive and in-depth review and assessment of the impacts of existing agreements. Effective steps must be taken to change the inherent imbalances and inequities of the WTO system and in the existing agreements. The complete text and list of signatories are available on the website: <www.southside.org.sg/souths/twn/title/atn-cn.htm>

BOX 3: ACP countries defend trade preferences The 71 member countries of the African, Caribbean and Pacific group (ACP) are negotiating a renewal of the trade and aid agreement with the European Union (EU), known as the Lomé Convention. The current convention runs out on 28 February 2000. Negotiators were optimistic following a 7-9 December round of talks in Brussels that a new accord would be finalized before the expiration date. Under the new arrangement, Lomé V, the EU would agree to provide E13.8 bn ($14.1 bn) in aid during 2000-2005 through the European Development Fund and another E1.7 bn in loans through the European Investment Bank. However, extension of the favourable trade preferences for ACP countries has fallen under the shadow of the World Trade Organization (WTO). Since the first Lomé Convention in 1975, the ACP countries -- all former European colonies -- have enjoyed preferential access to European markets for many of their exports. But because they are not required to extend comparable preferences to European goods entering their own markets, the arrangement is deemed to violate the WTO's insistence on "reciprocity." Previously, the EU applied for and received a waiver from the WTO to permit "non-reciprocal" preferences. It could seek another formal waiver, but has not yet publicly committed itself to such a course. Instead, EU negotiators have been trying to win agreement from the ACP countries on ways of bringing the Lomé Convention's trade arrangements in line with WTO rules. The ACP countries have argued that they need at least 10 years for their economies to adapt to more liberalized trade practices. A compromise worked out by the negotiators in Brussels provides for an 8-year "roll-over" period for current preferences, while a new, more open trade regime would be implemented over another 10-12 years. Yet anxiety remains high. A meeting of the ACP states in the Dominican Republic just a few days before the opening of the WTO gathering in Seattle issued a strong plea for giving developing countries time to adapt to global competition. Madagascar President Didier Ratsiraka drew the strongest applause when he lashed out at globalization as a "totalitarian doctrine" and accused the WTO of seeking to impose rules "on all human activities, defining them from now on as commercial objects." In the wake of the failure of the Seattle meeting, the EU should not be so worried about bringing the Lomé Convention within WTO rules, Côte d'Ivoire Minister of Commodities Guy-Alain Gauze said at a press conference during the subsequent Brussels negotiations.

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