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Commercialising Sustainability: The WTO in the WSSD

Shalmali Guttal, Focus on the Global South, June 6, 2002

For almost two weeks, government delegates at the Fourth Preparatory Committee Meeting (Prep Com IV) for the World Summit on Sustainable Development (WSSD) have been locked in a bitter battle to come up with a programme of action to take to Johannesburg this August. Reports from those observing the various negotiating sessions, and the state of the June 2 version of the Draft Plan of Implementation (also referred to as the Chairman's text) reveal a hopeless deadlock along North-South, North-North and even South-South lines.

At the heart of the deadlock are trade liberalisation, corporate accountability and regulation, domestic environments for private investment, governance, development financing, technology transfer, and technical assistance and capacity building. Japan, the United States (US), Canada, Australia and New Zealand (the JUSCANZ group) have knocked down most attempts to set specific targets and timelines for inter-governmental commitments and multilateral initiatives. The European Union (EU) has tried to hide its quest for markets behind clamors of ratifying Multilateral Environmental Agreements. All have been quick to block any attempts to reign in trade and investment liberalisation or curb the power of the corporate sector. The G-77 and China have stumbled along as usual, unable to come up with collective positions that adequately represent the priorities of the Group's diverse members. Progressive Southern delegates have been either absent or silent in key negotiations and overall, G-77 members seem content to let the OPEC agenda serve as the common position for the entire Group.

What most delegates do seem agreed on though is that economic globalisation and the WTO trade regime must not be compromised by airy-fairy talk about sustainability. Disagreements in the Chairman's text are more indicative of governmental differences about form and modalities than about substantive positions regarding sustainability.

Is the Chairman's Text about Sustainable Development?

In a word, no.

The first paragraph of the Chairman's Text reaffirms governments' commitment to the Rio principles, the full implementation of Agenda 21, achieving internationally agreed development goals--including those contained in the United Nations (UN) Millenium Declaration-and the outcomes of major UN conferences and international agreements since 1992. Well, here is the first fundamental drawback of the Draft Plan of Implementation.

The most significant international agreement in the past ten years has been the establishment of the WTO. Agreements negotiated within the WTO have far greater enforceability than those in any other multilateral forum. The Chairman's text reiterates at several places the commitment of governments to implement WTO agreements and initiatives. But as millions of people in the world already know and millions more are about find out, it requires tremendous imagination and a gigantic leap of faith to see any positive correlation between the WTO and sustainable development.

In the WSSD framework, sustainable development is supposedly dependent on three pillars: environment, economic and social. It is logical to assume that by this definition, a sustainable development agenda would attempt to forward actions that support equality, social, economic and environmental justice, environmental protection, equitable opportunities for human, social and economic development, peoples' rights to safe and healthy environments and livelihoods, etc. But this is not the case. The broad actions outlined in the Chairman's text do not tackle the causes and foundations of unsustainability and inequity that are destabilising our lives and planet. Instead, they back the standard, globalisation-friendly prescriptions with the word "sustainable" attached as prefixes.

An interesting strategy in the Draft Plan is how challenges to and responsibilities for sustainable development are divided between developed and developing countries. The main problem put before developed countries in the Plan is wasteful and unsustainable consumption, while developing countries are guilty of both unsustainable production and consumption. But, developed countries have the capital, technology, resources, institutional structures and know-how to implement sustainable development, which developing countries do not have. Developing countries, on the other hand, have most of the poor people in the world, and since (as indicated in the Plan) poverty results in unsustainability, it is the developing countries that must take firm and decisive steps towards sustainable development.

What then follows as a roadmap to address the challenges of sustainable development is little more than a reaffirmation of colonial economic relations: developing countries must undertake a range of actions in all sectors towards sustainable development by using the technologies, institutional capacities and financial resources owned by developed countries. These will be paid for by providing developed countries and their corporations access to the natural resources and markets of developing countries. The promise of future foreign investment, financial support and technical assistance from developed countries would be conditional on the willingness of developing countries to implement whatever actions are deemed supportive of sustainable development in the Draft Plan. Notable among these are the creation of a "conducive domestic enabling environment" for increasing foreign investment and full implementation of the work-plan from the WTO Ministerial Meeting in Doha.

The model of export-led and growth-directed development promoted by rich, industrialised countries and their even richer corporations, and by international institutions such as the World Bank, the International Monetary Fund (IMF), the WTO, and regional development banks remains untouched in the Chairman's text. The narrow economic imperatives of profit and wealth concentration that drive this model and have resulted in today's ecological disasters also remain unchallenged. The text does not acknowledge the role of past and present structural adjustment programmes, increasing militarisation, staggering debt burdens and consistently deteriorating terms of trade on the economies, environments and societies of developing countries.

Instead, the Draft Plan proposes that the capacities of developing countries be strengthened through increased interventions from the same actors who have been instrumental in precipitating the structural crises of impoverishment, environmental destruction and social insecurity: international financial institutions, the WTO, regional trade blocs, and private corporations. New on the debt crisis front are debt for sustainable development swaps, and the involvement of the private sector in resolving crises arising from indebtedness-much of which was created through unregulated private investments in the first place. Calls for a legally enforceable framework for corporate accountability have been rolled back to "Type II partnerships" through which private corporations would bring money and technology to the table in exchange for less regulation and public oversight.

The Draft Plan of Implementation does not contain any discussion about sustainable development itself. It is guided by the assumption that corporate globalisation is more or less fine, and that by adding the term "sustainable" to what is already common practice, governments can go about their usual business of transferring public wealth to private coffers without having to think any further about the deteriorating conditions of life faced by the majority of their populations. The privatisation of development financing enshrined in the Monterrey Consensus has seamlessly extended into the WSSD text. The Draft Plan advances a much-expanded role for the private corporate sector in sustainable development, but without the necessary accompanying mechanisms for legally binding and enforceable mechanisms for corporate accountability and responsibility.

In fact, Section V of the Draft Plan (Sustainable Development in a Globalising World) lays out a series of actions required to "make globalisation work for sustainable development." Predictably, these include the same policies that have led to the ecological, social and economic crises that most people in the world face today: greater overall liberalisation of the economy, unregulated export-oriented trade and investment, increased power to the corporate private sector through public-private "partnerships," decreased regulatory responsibility on the parts of governments, and the promotion of voluntary initiatives for corporate accountability and reporting, including the Global Compact. At the same time, developing country governments must implement "good governance" prescriptions laid out by international institutions in order to increase the efficiency of ODA, attract capital flows and facilitate international private sector investments (including those from transnational corporations).

The Chairman's text carries language on strengthening the capacities of women, indigenous peoples and small farmers. But the text is blind to the fact that their disempowerment is an accumulated result of years of marginalisation from lands, forests and water sources that they have sustainably stewarded for generations, from decent and safe employment, and from appropriate and sufficient human development opportunities. Through the logic of profits and efficiency, economic globalisation has undermined the fundamental rights of women, indigenous peoples, small farmers and fishers, workers and future generations to food, productive assets, development, health, education, economic, social and cultural autonomy, and self-determination. In the framework laid out in the Chairman's text, they must now resort to market mechanisms to claim what should be rightfully theirs to begin with.

Doha + 10 Months

The Draft Plan of Implementation clearly establishes the central place of the WTO in any future framework for sustainable development. Increased trade liberalisation through regional trade agreements is also encouraged, but only if it is consistent with the multilateral trading system as defined through the WTO. The WTO's role in the Draft Plan is non-negotiable and the text asserts in various sections that all policy and implementation mechanisms are expected to be consistent with the WTO framework and rules. Among others, the text proposes:

- Successfully completing the work launched under the Doha Ministerial Declaration; here the text calls upon WTO members to pay attention to the important deadlines that must be met to ensure progress by the Fifth Ministerial Conference and successful conclusions of negotiations by 1 January, 2005;
- Undertaking further action at national, regional and international levels to complement and support the Doha Declaration;
- Enhancing the delivery of trade-related technical assistance and capacity building programmes;
- Simplifying domestic procedures to facilitate developing country exporters;
- Identifying and developing trade-environment linkages; the text urges the Trade and Environment Committee in the WTO to start on this as soon as possible;
- Promoting public-private and multi-sector "partnerships" to provide essential services such as safe water, sanitation, waste-management, electricity, education, etc.; many if these areas are of interest to richer WTO members for the General Agreement on Trade in Services (GATS);
- Implementing the Trade Related Intellectual Property Rights (TRIPs) Agreement; this is rationalised from the perspective of protecting public health, but without any discussion about the disastrous effects of the TRIPs Agreement on local-national bio-diversity, traditional knowledge, genetic resources, bio-piracy, and the domestic abilities for industrialisation and to develop new technologies in developing countries;
- Increasing market access for goods within the framework of the Doha Ministerial Declaration;
- Committing/achieving on the part of developed countries the objective of providing duty-free and quota-free access for exports from all least developed countries;
- Facilitating the accession of developing countries to the WTO, particularly the least developed countries and countries with economies in transition;
- Focussing the WTO's assistance efforts, particularly the 2003 plan, on advancing the Doha agenda;
- Fully implementing the Integrated Framework for Trade-Related Technical Assistance (IF) to Least Developed Countries;
- Reviewing and operationalising all special and differential treatment provisions in the WTO with a view to making them more precise and effective, including concluding a framework agreement on special and differential treatment;
- Fulfilling the commitment of comprehensive negotiations on the Agreement on Agriculture (AoA), aiming at substantial improvements in market access, reduction with a view of phasing out all forms of export subsidies, substantial reductions in trade-distorting domestic support, and taking into account non-trade concerns;
- Promoting relationships between globalisation and social development to help developing countries improve the implementation of core labour standards, including through ILO mechanisms:
- Promoting/supporting the creation of domestic and international markets for organic produce and increasing technical assistance for developing countries for quality control compliance and preservation of consumer confidence; this would likely involve the application of Sanitary and Phyto-Sanitary (SPS) measures and new food safety standards by richer countries;
- Promoting the creation of voluntary, market based mechanisms to encourage production and trade in organic produce;
- Committing to comprehensively address the problems faced by developing countries in the implementation of the Uruguay Round Agreements; special attention to be paid to the imbalances and inherent asymmetries in some WTO agreements;
- Establishing legal and regulatory frameworks in supplier and recipient countries to expedite the transfer of technologies to developing countries in a cost -effective manner by public and private sectors; this would likely raise the problems of intellectual property rights and patent protections;
- Promoting/ensuring coherence and mutual supportiveness between the rules of the multilateral trading systems and multilateral environment agreements (MEAs) in support of the work progranmme agreed through the WTO;

Reports from the contact group on trade during the negotiations indicate that countries are more than willing to insert the entire work programme that emerged from the Doha Ministerial meeting into the WSSD's Draft Plan of Implementation. Delegates at the contact group had copies of the Doha work programme in hand as they negotiated line-by-line the relevant sections on globalisation, trade and finance, and implementation.

The nature of negotiations too is reminiscent of the WTO: in the absence of clear agreement or consensus, the text proposed by the US or the EU unfailingly became the alternative formulation with the G-77 and others standing by. Needless to say, much of the text proposed by the G-77 did not receive support from the QUAD countries. The G-77 and China pushed hard for more special and differential treatment provisions, but were turned down by the US and the EU, who were firm that WSSD commitments could not surpass those made in the WTO. There were even rumors of off-the-record, exclusive, closed meetings between the US, EU and G-77 to achieve "consensus" on the most contested portions of the Chairman's text.

So obvious is the infusion of the WTO-Doha work programme into the Chairman's text that Dr. Wolfgang Sachs, a well known ecological activist, remarked in disgust: "instead of Rio + 10 years, this should be called Doha + 10 months".

The WTO agenda is further entrenched in the Draft Plan of Implementation through recommendations for increased collaboration between the UN system, international financial institutions and the WTO. Overall, the text proposes strengthening the role and efforts of the Bretton Woods Institutions (BWIs) in "furthering the benefits of globalisation" to sustainable development. "Policy coherence" is the order of the day and the Bretton Woods and UN agencies must jointly commit to implementing whatever will be left of Agenda 21, relevant parts of the UN Millenium Declaration, the Monterrey Consensus and of course, all the outcomes of the Doha Ministerial Meeting.

Passing Unregulated Trade as Sustainable Development

Despite language in the WTO's preamble about enhancing social welfare and promoting development, the WTO is not a development institution. It is an unequal, inequitable, highly non-transparent and unaccountable institution. It protects and advances the interests of large corporations, most of which are based in rich northern countries and many of which are transnational in nature.

Trade is an extremely important economic activity and has a critical place in national development and the strengthening of domestic economic capacity. However, the trade regime imposed through the WTO does not serve such a function. The WTO was established in order to expand and accelerate the process of corporate globalisation, and this is reflected in its agreements, institutional framework, work programmes and decision-making processes. To equate the WTO with sustainable development is to kill any progressive notion left in the conceptualisation of sustainability or development.

The economic model promoted through the WTO is based on and perpetuates extractive and unsustainable forms of production and consumption, and fosters export dependency and indebtedness at the national, local and individual levels. Countries that come out ahead in the WTO system are those with already significant advantages of accumulated capital, and well-developed technological, industrial, production and institutional capacities. Countries without these advantages are reduced to playing "catch-up" since the equity enhancing measures in the WTO are never implemented in step with the negotiation of new agreements.

In the model of corporate globalisation that the WTO advances, the stuff of everyday life, pleasure and recreation, and even humanitarian crises are all redefined as business opportunities. Hence, there are ever increasing moves to expand unregulated trade and investment efforts into all areas of basic needs and survival: food, agriculture, water, health, sanitation, environmental protection, education, emergency services, tourism, funeral services, etc. The WTO's agreements on Agriculture (AoA) and Services (GATS) will ensure that every aspect of our lives, from birth to death, will be commercialised, and out of our hands and jurisdictions.

The outcomes of the WTO Ministerial meeting in Doha do not constitute a development agenda by any standards except those observed by the WTO itself. While the Doha Declaration contained some language on the need to pay more attention to implementation issues, the work programme outlined in the Declaration did not make any specific commitments to address long-standing inequalities and imbalances in the capacities of developing countries to negotiate a development-friendly trade agenda.

The work programme did not include firm commitments to implement special and differential treatment provisions, nor did it acknowledge the requests by developing countries to comprehensively review the TRIPs Agreement and the state of privatisation in developing countries before moving forward with GATS negotiations. Instead, the work programme was expanded to include new issues-investment, competition, trade facilitation, and government procurement-and thereby increasing the work burden on developing countries already struggling with small, under-resourced and under-financed delegations. In addition, a new section on environmental services was added to the Declaration at the eleventh hour without consultation with majority of the developing countries.

It is indeed extremely worrying that the WTO trade regime and the Doha work programme have such a central role in the Draft Plan of Implementation for the WSSD. The policy coherence proposed in the Chairman's text in effect spells out further subservience of the UN agencies to the BWIs since the BWIs come backed with far greater financial backing from the G-7 and OECD countries than the UN. And through this latest move in Prep Com IV, the WTO is well on its way to becoming a totalitarian global government with the blessings of the UN system.

Allowing this to happen practically amounts to giving away our environments, cultures, social and economic potentials, and fundamental rights to private corporations, who will continue to operate with greater impunity than before. It will undermine any future possibility of genuinely sustainable development. Although much of the text in the Draft Implementation Plan is still in bold typeface and bracketed (which indicates that agreement has not yet been reached), the nature of negotiations thus far do not provide signs of hope that the final text adopted in Johannesburg will be much of an improvement on the current draft.

The challenge before us is not whether we can change this or that paragraph in the Draft Plan of Implementation, but whether we can push our governments to come up with a plan for sustainable development instead of one for unregulated trade and investment.

On these grounds, and in order to salvage the principles and future possibilities for sustainable development, non-business, non-corporate civil society must reject any inter-governmental declaration from Prep Com IV that legitimises the Draft Plan of Implementation. The WTO and corporate economic globalisation must not come into the WSSD. Instead, we must come up with alternative programmes for genuinely sustainable development and intensify our work at national levels to ensure that our governments defend and protect our rights in Johannesburg.

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