RURAL SLAVERY THAT IS FREE TRADE

The Guardian
Colin Hines and Caroline Lucas
Monday October 27, 2003, p. 25.
Original here

In the acres of coverage about Cancun, little mention was made of the contradiction at the heart of the World Trade Organisation's agenda, which not only ensured that meeting's doom but is likely also to guarantee the failure of any future ones.

Officially Cancun collapsed because of disagreements between trade ministers over subsidised northern agriculture and the imposition of new issues such as investment and competition. In reality the seeds of its collapse were sown in the widespread concern about domestic job losses which could not be squared with ever more open markets and the increasing cheap imports they bring in their wake.

So, while both rich countries and the developing world swore allegiance to the goal of reducing all barriers, most were trying to put off the evil day when they had to deliver it. Such inconsistencies are not difficult to understand once simplistic, neo-liberal economic theories collide with hard political realities.

The suicide of the South Korean farmers' leader Lee Kyung-hae in Cancun in protest at the millions of small farmers ruined by international trade has parallels in the UK, where one farmer kills him or herself every six days. The vast majority of them are struggling to make a living, with hundreds leaving the land every week.

Most developing countries face even more serious rural problems. Following a case brought against it at the WTO by the US, India has been forced to reduce import barriers on key food commodities, with devastating results. Prices of coconuts have collapsed by 80%, pepper prices have fallen 45% and domestic production of edible oil has been effectively wiped out.

Small wonder that India's trade union movement has recently joined farmers, academics and activists calling for a reintroduction of import controls. These are seen as essential for protecting not only India's agriculture but also its industry from cheap imports from third world competitors such as China and Malaysia, as well as from the subsidised dumping of food on their markets by the United States.

Indeed, China is at the heart of this new debate. Media attention has focused on the US administration's call for China to devalue its currency to make its imports less competitive. But China is also an increasing threat to competing third world exporters in a range of areas from India's software exports and Sri Lankan organic tea production to textile exports in general.

To say this is not to be anti-Chinese: things are worsening there for the majority, too. About 100m Chinese are leaving rural areas to seek urban work and they will be joined by the tens of millions to be made redundant in existing Chinese industries as they rationalise to compete. This growing reserve of cheap labour queues for work at global rock-bottom wages.

Yet trade could make a valuable contribution to achieving job and food security and poverty alleviation globally. But to achieve this, international competitiveness and reductions in trade barriers have to be replaced by a combination of internationalism and new rules to allow elected governments to protect their domestic agriculture, industry and services.

The gradual reintroduction of import controls, allied to domestic policies and redirected aid and trade rules which make the rediversification of local economies worldwide a priority, is the only way to protect livelihoods and reduce poverty. This would provide economic security for all, not just the rich north. Poor countries could also concentrate on meeting their basic needs rather than providing ever cheaper exports.

Because food now provides the lighted touchpaper in so many trade disputes, the provision of food security for both rich and poor countries is crucial. It is time that southern farmers, and the non-governmental organisations working with them, joined with threatened farmers in the rich world to ensure they both have a future. This will involve opposition to the mantra of ever more indiscriminate market access and instead the forging of an international alliance for self-reliance.

Such a radically different approach to trade is not as fanciful as it might at first seem. The new boy on the WTO block, China, has brought with it the seeds of destruction of the organisation's free-market obsession.

As the debt-sodden, deflation-threatened global economy continues to slow, the US Congress is already introducing legislation to impose tariffs on Chinese imports.

Similar unease is growing, particularly in the trade union movement worldwide, about cheap imports from China and in rich countries about the relocation of service jobs to India.

In response to their restive populations, governments are likely to return to protective barriers. To ensure that this does not result in a return to beggar-your-neighbour policies but instead better-your-neighbour trade rules geared to relocalising economies worldwide, the WTO will need a radically new direction: its priority must become self-reliance, not market reliance.

Colin Hines and Caroline Lucas MEP are authors of the forthcoming report An International Alliance for Self Reliance: the Post-Cancun Agenda