What the HK battles were all about*

Rene E. Ofreneo, Ph.D., Executive Director

Wanchai, Hong Kong – The rich and luxurious side of Hong Kong – from the Causeway Bay (famous for its jewelry stores) to the Wanchai district (the corporate headquarters of the region’s biggest multinationals) – has become a huge battleground since December 11, two days before the grand opening of the 6th Ministerial Conference (MC6) of the World Trade Organization.

Daily, militant farmers, workers, migrants and social activists from South Korea, Philippines, Bangladesh and other countries have been launching militant actions which have stunned the Hong Kong’s youthful police and staid society for the novelty and daring of the protest activities, from the fluvial demonstrations by the Greenpeace environmental and Filipino fish campaigners to the military-like marches by the Korean farmers and trade unionists towards the HK’s Convention Center. United in their campaign against a ‘neo-liberal corporate-led globalization’, activists of all hues and beliefs have also converted the Victoria Park into a tent city hosting anti-WTO meetings and cultural programs dealing with the social, economic and gender aspects of globalization.

The activist grapevine is abuzz with stories that more dramatic confrontations and demonstrations are forthcoming before the MC6 ends on December 18. An international protest action by ‘sex workers’ from various continents are excitedly being discussed, while new Korean-led militant actions are quietly being whispered by the guerilla-like anti-WTO activists.

Why are workers, farmers, migrants and social activists from both developed and developing countries so bent on derailing the MC6 and in venting so much anger on the WTO?

One obvious answer is that the WTO has become the most concrete symbol of the social and class inequities under globalization. Hundreds of simultaneous NGO seminars and conferences that are running parallel to the WTO’s MC6 are virtually united on one conclusion – globalization, pushed by the WTO, IMF-World Bank group and neo-liberal economists, has generated across the globe more inequality, higher unemployment, deeper social insecurity and, in the case of many developing countries, widespread poverty and development failures.

Farmer suicides are also common in South Korea, Africa and in India, where some NGOs gave a figure of as much as 25,000 for the number of farmer suicides since the WTO’s formation in l995. These suicides are directly related to the asymmetry in the global trading system in agriculture, where developed countries, by lavishing their domestic corporate producers and exporters with $1 billion subsidy a day, are subverting the viability of small farming in developing countries, especially the small African cotton farmers, because of the resulting global dumping of agricultural products from the North.

The Battle within MC6

Agriculture, of course, is one major issue in the ongoing Ministerial, which is shaping into a titanic battle between the haves and the haves not.

MC6 was supposed to be the culminating activity for the Doha Development Round (DDR), a new round of trade talks launched in 2001 aimed at producing a new trade liberalization agenda for the second decade of the WTO.

However, many developing countries are unhappy because the DDR trade agenda, formulated by the WTO Secretariat and the developed countries, is overly focused on radical trade liberalization formulas – bands of tariff reduction in agriculture, tariff-reducing coefficients for industry (and fishery) and ‘complementary approaches’ in service sector liberalization. In contrast, there are hardly any concrete or constructive proposals from the WTO Secretariat, United States and European Union on how to reduce the trade-distorting agricultural subsidies provided by the developed countries, on the special-and-differential ‘flexibilities’ and ‘safeguards’ that are available to developing countries in all the three economic sectors and on how unilateral trade liberalization, which the Philippines foolishly pursued in the l980s and l990s, can be ‘credited’ as compliance to any new round of liberalization, should there be any agreement .

A number of developing countries, however, are emboldened by their success in halting the Ministerial in Seattle in l999 and in Cancun in 2003, which led to the withdrawal of the ‘Singapore issues’ (investment, government procurement and competition policy) in the current MC6 agenda. Cancun also produced two new groups of developing countries which are playing an increasingly important role in global trade talks and which have been successful in articulating the global asymmetry in agriculture – the G20 led by Brazil and India, which insists on the phasing out of the trade-distorting agricultural subsidies, and the G33, chaired by Indonesia, which seeks formal recognition to the right of developing countries to have certain products declared ‘special’ and protected by ‘special safeguard mechanisms’ (SSMs). The Philippines is a member of G20 and is one of the acknowledged leaders of G33.

Thus, organizers of the Hong Kong’s Ministerial see no immediate compromise among the WTO member countries, given the wide gap in the positions of the haves and the haves-not. They have, therefore, downscaled their fighting target – from a new WTO agreement in Hong Kong into a consensus to continue the negotiations in Geneva and to have a formal agreement sometime in 2006 through the WTO’s General Council.

In the meantime, the developed countries are tireless in their campaigns to ‘soften’ the stand of the developing countries against a general ‘market access’ opening in agriculture, industry and services. An ‘aid for trade’ is being dangled by US Trade Representative Rob Portman, roughly $2.5 billion in all, to improve the capacity of developing countries in complying with trade liberalization commitments. The threats of the US to go bilateral or regional with the ‘coalition of the willing’ through new ‘free trade agreements’ are also continuing. And so are the not-too-subtle pressures coming from the international financial institutions (IFIs), which are seeking ‘coherence’ with the WTO on their ‘structural adjustment programs’.

Attitude of Civil Societies

Thus, Fair Trade Alliance Lead Convenor, former Senator Wigberto E. Tanada, is both pleased and worried.

He is pleased that the Philippines has aligned with other developing countries in pushing for reforms (subsidy reductions, special products, safeguard mechanisms, etc.) in the global agricultural trading system. The FTA was also informed by the government trade negotiators led by DTI Secretary Peter Favila that the Philippines is not even keen on discussing the tariff coefficients for industry and fishery under the Non-Agricultural Market Access (NAMA) because the Philippines, having reduced its tariffs unilaterally to the average level of the developed countries, should not be punished with the application of new tariff-busting coefficients. Additionally, the government also wants similar flexibilities in service trade talks, including the retention of the request-offer trade negotiation formula, which the European Union wants to junk in favor of the catch-all ‘benchmarking’ and ‘complementary approaches’.

However, former Senator Bobby Tanada is also worried that some developing countries, the Philippines included, may not be able to summon the political will to stand up to the trade talk offensive of the developed countries, who are dangling the ‘aid for trade’ carrot and policy ‘coherence’ with the IFIs. India and Brazil are reported to be wavering because of certain economic concessions being promised by the US and EU.

As to the crediting of the Philippines’ earlier and unilateral trade liberalization, the WTO rules and practices do not appear to be encouraging. There are no WTO rules on exception to any trade liberalization formulas. This is why many countries keep postponing or moderating their liberalization programs, in order to have policy space and trade marbles for negotiation purposes. The exact opposite happened in the Philippines.

Thus, what is happening in Hong Kong is the realization among many Filipino trade stakeholders, e.g., industrialists, farmers, trade unionists, civil society advocates and others that they are facing double challenges – one, the task of helping strengthen the global movement for just and fair global trade rules, and two, the task of instituting reforms in the national economy, which has been ravaged by a haphazard and unilateral liberalization pursued by the neo-liberalizers of the l980s and l990s.

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* Article published in Business Mirror on December 19, 2005

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