Global Policy Forum

By Lori Wallach and Chris Slevin*

There has been little advanced coverage of this week's World Trade Organization meeting in the U.S. press, but elsewhere the WTO's 5th Ministerial is a very big story. The sessions in Cancún will determine the future of the WTO and what version of economic globalization is implemented worldwide.

The sparse U.S. coverage has focused on the intricacies of WTO chess play -- which country is seeking what concession -- or broader accounts of a few big fights, such as the European Union's battle with the United States on biotech crops. Yet underlying all this activity is a much more massive ideological clash.

"The main task will be to take stock of progress in negotiations and other work under the Doha Development agenda," the WTO's Web site says, referring to the last global trade talks held in Doha, Qatar in 2001. In Doha, developing countries presented numerous demands to balance the rules of the international economy so they didn't favor the wealthiest nations. But those demands have largely been ignored or led nowhere.

Thus, a great ideological divide looms over Cancún. On one side sits the United States, the E.U., Japan and other developed countries that want the WTO's rules to be "the Constitution for a single global economy," as the first WTO Director General, Renato Ruggiero, infamously uttered.

Wealthy nations want to expand the so-called "Washington Consensus," an unabashedly pro-corporate agenda that's shaped many world trade policies and laws in recent years. This "consensus" has undermined the role of government regulation of the market; has established new property rights and protections for corporations; and has given the private sector access to public trust assets such as genetic materials and water.

Amazingly, this is merely the beginning of a bigger blueprint. The wealthiest nations are pushing for controversial provisions of the North American Free Trade Agreement to be adopted by the WTO. These so-called "new issues" include expansive investor rights and rules allowing international standards to supplant domestic laws, such as public health and environmental legislation.

The less-wealthy countries have a totally different agenda. These nations want the WTO to just deal with trade -- and do so in a way that benefits all nations. While they differ on what comprises fair trade rules, they are united in opposing any expansion of the WTO into the "new issues" -- because most of these "new issues," such as intellectual property law, are seen as only benefiting wealthier nations. In contrast, the agenda that the developing countries tried to raise at Doha -- seeking progress on many social and quality of life issues -- have been largely ignored by the WTO administration.

This schism and debate is not new, but it's become increasingly polarized. When the 1994 Uruguay Round created the WTO, developing countries were promised major gains as industrialized countries lowered and eventually eliminated tariffs on items like textiles and apparel, and cut some agricultural subsidies. Editorial boards and opinion-shapers largely endorsed the opening of these markets, claiming the WTO would be good for development.

But those promises have not materialized. After nearly nine years, many developing countries have seen their own poverty worsen. The number of people living on $1 a day (the World Bank's line of extreme poverty) has risen since the WTO went into effect. Economic growth has slowed and the least developed countries' share of world trade has dropped. (See Public Citizen's forthcoming new book from The New Press, Whose Trade Organization: The Comprehensive Guide to the WTO.)

These bad results prompted more than 90 developing countries to file an official WTO paper -- called the "Implementation Agenda" -- at the last WTO Ministerial in Doha. It laid out ways in which the WTO could be altered to work better for them. Yet only four of their more than 100 suggestions were addressed in the final Doha Declaration, which the WTO Secretariat called the "Doha Development Agenda" and the developing countries sarcastically dubbed the "Everything but Development" agenda.

Count on developing countries to keep pushing the "Implementation Agenda" in Cancun. This is why just last week, South African President Thabo Mbeki called on developing countries to work together with civil society -- public interest groups and protesters -- on the battle over the WTO's future.

Why do most Americans have no idea that this battle royal is underway? After Doha, the WTO promoters went into full political campaign mode and declared great compromises were reached with developing nations and the WTO was maturing. Papering over the fact that remote Qatar banned demonstrations, WTO leaders declared to the leading financial newspapers, "This has been a hell of a good week for the WTO... the WTO is back on track and the train has left the station."

However, back in Geneva -- where the WTO is based -- the headaches began as the realities sank in. Trade negotiators missed all of the deadlines set in Doha for "deliverables" in Cancún, including draft agreements on agriculture (the backbone of nearly two-thirds of WTO nations' economies), and trade in non-agricultural goods, intellectual property and access to essential medicines.

The response from the WTO Secretariat has been more top-down heavy-handedness. It shipped its own legislation to Cancún to serve as the basis for the negotiations. The move has caused yet further anger and divisiveness. Meanwhile, the WTO spin machine is at it again -- this time working to lower expectations about the Cancún meeting -- which is a distant cry from their previously stated exuberance over Doha.

This sets the stage for much WTO-led spinning. Look for WTO boosters to announce that a "framework" for a new "round" of WTO talks has been agreed in Cancún. Recall that such a framework was already agreed in Doha and at Cancún, but specific agreements to implement this framework were gutted and ignored. If the developing countries withstand the outrageous tactics they have faced in the past, what will actually be agreed on in Cancún is nothing. Given the alternative -- launching new issues that favor western economic elites -- that's a fine outcome.

Yet continued deadlock will do nothing to deal with the severe damage the existing WTO rules are causing -- including creating increased hunger thanks to the WTO's current agriculture rules, which actually facilitate food dumping. To deal with these issues will require a major shift in the powerful WTO countries' agenda.

The crisis of legitimacy that hovers over the WTO in Cancún may not be in headlines yet, but it is on the minds of even the WTO's greatest defenders. Consider U.S. Trade Representative Robert Zoellick's opening thoughts at a Washington, D.C. news conference last week: "Unfortunately, there's no avoiding Cancún."

*About the Authors: Lori Wallach is the director and Chris Slevin is the press secretary of Public Citizen's Global Trade Watch.

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