Leaked EU Documents Show What's Next in the WTO

In 1998, opponents of corporate globalization scored a significant victory when the text of the proposed Multilateral Agreement on Investment (MAI) in the OECD was made available through the internet. Key governments were embarrassed into withdrawing their support for what was widely (and correctly) perceived to be a charter of unlimited transnational investor rights. The MAI's corporate backers, however, never abandoned the project. It has resurfaced in, among other places, the proposed investment provisions of the Free Trade Agreement of the Americas (FTAA), which will expand the North American Free Trade Agreement (NAFTA) to take in the countries of Central and South America and the Caribbean. And it is working its way into the WTO.þþþþThe sections on ÿTrade and Investmentÿ adopted as part of the WTO's ÿDoha Development Roundÿ encourage the move towards a comprehensive, MAI-type all-encompassing charter of multinational investor rights inside the WTO. Now confidential documents prepared by the European Commission to define the European Union’s position in the WTO negotiations on trade in services (GATS) give a flavour of what the GATS are likely to bring if corporate appetites are not curtailed. The documents were leaked on April 16 and are available in English at Gatswatch.þþþþThe documents set out a still incomplete series of demands which the EU plans to make of 29 WTO member states, rich and poor. These demands, expressed in the bureaucratic language of the WTO, essentially constitute a single proposal: services, including water, energy, transport, communication and travel and tourism are to be placed on the corporate auction block and national legislation to protect these sectors from full corporate invasion is to be abolished. The catchall ÿenvironmental servicesÿ includes, among other things: ÿwater collection, purification and distribution services through mains, solid/hazardous waste management, refuse disposal services, sanitation and similar protection of ambient air and climate, services to reduce exhaust gases and other emissions and improve air quality, remediation and cleanup of soil & water, treatment and remediation of contaminated/polluted soil, protection of biodiversity and landscapeÿ and ÿother environmental & ancillary servicesÿ.þþþþThese demands are signposts to a world in which corporations will run fully privatized water systems for industry, agriculture and consumers. Corporate water will irrigate fields sown with GMO seeds. Corporate ÿenvironmental servicesÿ will charge governments for cleaning up toxic waste, including pollution generated by transnationals. Private medical services will treat the victims and the sick who can afford to pay. Corporate ÿeducation servicesÿ will supplant public schooling.þþþþFar-fetched? Under NAFTA's Chapter 11, UPS is suing the government of Canada for, in effect, maintaining a public postal system. The lawsuit is a challenge to the very idea of a public sector. And NAFTA's Chapter 11, which has been used to strike down environmental legislation aimed at protecting public health in all three signatory countries, was the model for the MAI and the inspiration for much of what will undoubtedly surface in the Doha Round WTO investment proposals.þþþþInvestor-to-state lawsuits, which have been used to devastating effect through NAFTA, may not figure in the new WTO investment rules, although this possibility cannot be excluded. What is certain is that sweeping protection for transnational investors can be brought in through the GATS. NAFTA rules stipulate that national legislation must be ÿleast trade restrictiveÿ. European GATS negotiators, on the other hand, have taken on board corporate proposals for an expanded ÿnecessity testÿ which would require member states to prove that regulations aimed at protecting the public interest are not ÿmore burdensome than necessaryÿ to investors. The bottom line rules: any measures that would increase operating costs to business are potentially vulnerable to challenges by investors and therefore liable to be struck down by the WTO. With GATS rules like this, there is no need for cumbersome investor-to-state lawsuits: governments will have surrendered in advance any claim to defend the public interest. þþþþWhile EU governments and trade bureaucrats scramble to contain the damage and identify the source of the ÿleakÿ, trade unions can extract several lessons from this episode in the ongoing history of secret trade diplomacy. First among them is the recognition that governments, whether national or supranational, do not trade. Corporations trade, and corporate appetites today recognize no frontiers and know no limits. The EU claims to embody a commitment to ÿsustainable developmentÿ. The EU's negotiating position in the GATS talks suggests otherwise. Increased market access for developing countries through the ÿeverything but armsÿ trade package promoted by Trade Commissioner Pascal Lamy apparently carries a heavy price, best described as ÿeverything on the auction blockÿ.þþþþSecond, popular mobilization killed the MAI, but it didn't kill it dead. Unions and allied organizations will have to scrutinize the GATS talks and remain in a state of heightened alert to ensure that the MAI doesn't sneak in the back door of the GATS.þþþþEqually important, unions internationally need to elaborate, and fight to implement, an alternative vision of world trade in which trade is harnessed to democratic development and the satisfaction of human needs rather than private profit. Threats like the MAI and the GATS proposals, which would deliver even the world's genetic resources, air and water to the highest corporate bidder, will continue to resurface until the logic of solidarity supplants the logic of the boardroom and rights take precedence over profit.