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Global Trade Watch E-Newsletter #32 - July 2005
NB: This is an archived newsletter. Information may no longer be current, and links to other sites may not always work.
* EDITORIAL: China’s Free Trade Policies are Making Most Chinese Poorer
In case you haven’t noticed (it hasn’t been in the media much), the Howard government is negotiating a Free Trade Agreement (FTA) with China. Now while China is a ruthless dictatorship which executes thousands of people every year, operates slave labour camps and harshly represses minorities in Tibet and Inner Mongolia, the Howard government has declared that it does not think human rights concerns have a place in trade negotiations. But even if you accept this, surely it is worth considering what impact an Australia-China FTA would have on Chinese people.
Economists have a platitude: “A rising tide lifts all boats”. Free trade agreements, they tell us, will benefit everyone if they’re really free. But the evidence coming out of China gives the lie to this saying. Since joining the World Trade Organisation (WTO) in 2001, trade and economic growth have soared, yet the majority of Chinese who live in rural areas are actually getting poorer and their lives are getting worse.
Sixty percent of all Chinese - about 700 million people - live in rural areas. Earlier this year, the World Bank released a report which found that since China joined the WTO in 2001, these 700 million rural chinese have on average lost about 1% of their total income. In the same period, the Chinese economy as a whole grew by more than 25%. Based on a survey of 84,000 people, the report found that the rural poor have been even harder hit, with trade liberalisation has resulting in a "sharp 6-per-cent drop" in living standards for this most vulnerable group. “"The poorest rural households . . . suffered a sharp 6-per-cent drop in their living standards, as measured by consumption, due to the combined effect of a drop in real wages and an increase in the prices of consumer goods," the report found.
This comes on top of an admission last year by the Chinese government that the number of farmers living in poverty rose by 800,000 in 2003 - the first rise since 1978. The gap between the rich urban minority and the poor rural majority is widening, with the Chinese Academy of Social Sciences finding that average urban incomes are over three times higher than rural incomes - the worst ratio in the world.
And just last week, the state-owned China Daily reported that “The number of people committing suicide has soared in China recently, rising to an estimated 250,000 a year. The number of unsuccessful suicide attempts stands at least 10 times that number, between 2.5 million and 3.5 million.” This equates to a suicide level of 22 for every 100,000 people. Again, rural people were the worst off, with rural women recording a suicide rate of 30 in every 100,000 - one of the highest rates in the world.
What is occurring in China mirrors the same process which has occurred in most developing countries as they have opened their markets to trade liberalisation. Reducing tariffs stimulates economic growth by forcing subsistence farmers – often the majority of the population in developing countries – to compete against highly subsidised agricultural imports from rich countries. The subsidised imports undercut their prices, and thus destroy their livelihoods. Ruined farmers move to overcrowded cities and take jobs in export-processing zones producing exports for a few cents an hour. The Australian government has described in glowing terms “the transformation of Asia's . . . predominantly subsistence agriculture, into a rapidly modernising system of agribusiness.” But the realities for poor Chinese people are rarely considered by those making the trade deals which will push them further into poverty.
If it had any concerns about the lives of China’s 700 million rural citizens, the Howard Government would immediately end FTA negotiations. But once again, it’s more likely that ideology will triumph over the evidence.
(For a perspective on the same process happening in India, coma long to hear Devinder Sharma speak in Melbourne - full details below in “Upcoming Events”. )
* What Really Happened at the G8 Summit?
With all the media hype, the Live8 concerts and the London bombings, it was easy to miss what really happened at the G8 meeting last month. If you’d like the low-down on what went down and how it stacked up against the demands of global civil society, the World Development Movement has a clear summary available here: http://www.wdmscotland.org.uk/campaigns/g8/postg8/index.htm
* Fair Trade Job
FTAANZ -Fairtrade Association of Australia and New Zealand- is seeking a Market Development Coordinator and a Producer Support Coordinator to be based in Auckland or Melbourne. The internationally recognised systems of Fair Trade have the potential to deliver benefits to poor and disadvantaged producers in the developing world. The Fair Trade Association of Australia and New Zealand (FTAANZ) is working to facilitate the development of fair trade and increase the benefits to developing country producers. FTAANZ is recruiting two positions Market Development Coordinator and a Producer Support Coordinator, to be based either in Auckland or Melbourne. Applications should include: a covering letter, an up to date curriculum vitae, a document outlining your relevant skills and experience in relation to the competencies outlined in the job description. For more details see www.fta.org.nz The closing date for applications is 31st August 2005. Please direct all applications to: [email protected]
* Sun Aug 7, 6pm - Film Fundraiser for the Melbourne Social Forum: "Hope Will Win Over Fear" - In "Hope Will Win Over Fear", the World Social Forum's Alfred Hernandez combines interviews and analysis with popular Brazilian music and event footage in documenting the World Social Forum movement. WHERE: Glitch Bar & Cinema, 318 St. Georges Rd, N. Fitzroy. ENTRY: $5 ($3 concession)
* Wed 24th Aug, 6:30pm - Devinder Sharma discusses Trade Liberalisation - As part of Oxfam Australia's Make Poverty History Campaign, leading agricultural economist and award-winning journalist, Devinder Sharma will talk about trade, the WTO and agriculture from an Indian perspective. A leading agricultural economist, well known for his views on food and trade policy, Mr. Sharma is at the forefront of the global debates on genetic engineering, globalisation and free trade. WHERE: RMIT Casey Plaza Lecture Theatre, Building 10, level 4 (ground level), Room 24, Swanston St, City. (If you require a map please email a request to the below address). All are welcome to attend. There is no cost for this lecture. Please RSVP to: [email protected]
NEW SOUTH WALES
* 27-29 August - Sydney Social Forum - Join with hundreds of local community activists, trade unionists, environmentalists, thinkers, artists, concerned citizens and international speakers for three days of open space workshop discussion, debate, strategising, info and skill sharing and inspiration at the 4th Sydney Social Forum. WHERE: Petersham Town Hall & Petersham West TAFE. More Info: www.sydneysocialforum.org/
* 30 Aug-1 Sept - Protest the Forbes Global CEO conference - From 30 August 2005 one of the world's richest men Steve Forbes and NSW Premier Bob Carr will host the fifth annual Forbes Global CEO Conference, to be opened by Prime Minister John Howard at a swanky cocktail event at the Sydney Opera House. For two and a half days the Opera House will be taken over by more than 300 CEOs - representing some of the world's biggest war profiteers, environmental vandals and corporate crooks. Like the World Trade Organisation and the World Economic Forum, the Global CEO Conference is a means of promoting economic and social policies that benefit the rich and the powerful at the expense of the majority of the world's people and the environment. A $5000 a head event restricted to top executives means that you're not invited - but you can come anyway by joining the 30A protests. More info: www.30a.org
* Please email in your upcoming events!
* WORLD TRADE ORGANISATION NEWS *
* A Bitter Pill for the WTO and Activists to Swallow (Jul 29) - WTO authorities played down the significance of the new stalemate in the Doha Round of talks and the threat hanging over the sixth ministerial conference in Hong Kong. But civil society organisations see the multilateral trade system's latest fiasco in a much more serious light. More: http://www.ipsnews.net/news.asp?idnews=29715
* Toning Down Frustration Over Latest WTO Failure in Talks (Jul 28) - This week's failure by the WTO to reach a key agreement to keep trade liberalisation talks on schedule did not have the same impact as the fiascos in Seattle (1999) and Cancun (2003) because the prestige of ministerial conferences is not at stake as it was back then, and because clear efforts have been made to tone down the reactions. More: http://www.ipsnews.net/news.asp?idnews=29699
* US Faces Fresh Challenge on Farm Subsidies (July 27) - After successfully challenging rich countries' cotton and sugar subsidies before the WTO, poor countries are trying to put further pressure on the US in ongoing agricultural trade talks. Uruguay has filed a new dispute with the WTO Dispute Settlement Mechanism, claiming that US rice subsidies make it harder for its own exports to compete in the world market. More: http://www.globalpolicy.org/socecon/trade/subsidies/2005/0727freshchallenge.htm
* Business Threatens Development at Talks (Jul 27) - Anti-poverty campaigners are demanding that the European Union halt its "aggressive attempts" to open up developing country markets for the benefit of European big business during World Trade Organisation talks in Geneva this week. More: http://www.ipsnews.net/news.asp?idnews=29673
* It's a Long, Bumpy Road to the Next Doha Round (July 25) - As the World Trade Organization Ministerial Conference in December 2005 approaches, many bones of contention remain between rich and poor countries. To overcome the hurdles and reach a trade deal that would alleviate global poverty, rich countries should take Africa's special needs into account. More: http://www.guardian.co.uk/business/story/0,,1535329,00.html
* WTO head hits alarm (Jul 23) - World Trade Organisation director-general Supachai Panitchpakdi has smashed the glass to ring the alarm bell about the future of the Doha Round negotiations, as fears grow that the world's best hope for trade liberalisation is heading for failure. More: http://www.theage.com.au/news/business/wto-head-hits-alarm/2005/07/22/1121539155964.html
* Vaile warning on farm subsidy reform (July 15) - Trade Minister Mark Vaile has warned that the Doha Round negotiations to free up global trade are doomed unless the European Union and the United States can come up with a quick political deal soon to open the way for sweeping reform of farm protection. More: http://www.theage.com.au/news/business/vaile-warning-on-farm-subsidy-reform/2005/07/14/1120934365003.html
* Bound and Tied (July 2005) - Rich countries act on behalf of transnational corporations in the World Trade Organization talks on non-agricultural market access, argues this ActionAid International report. While paying lip service to development, rich nations are trying to force poor countries to open their markets. In the past, however, rapid industrial liberalization has "often had a devastating impact on development and poverty”. More: http://www.globalpolicy.org/socecon/bwi-wto/wto/2005/07boundandtied.pdf
* More News on the WTO here: http://www.globaltrading.com/s/trading/wto.html
* BILATERAL AND REGIONAL FREE TRADE AGREEMENTS NEWS *
* Pacific nations’ threat (July 28) - Papua New Guinea and other Pacific Island countries (PIC) are likely to be forced to drop trade barriers earlier than planned to Australia and New Zealand. That would mean massive revenue losses from premature phasing out of tariffs and increased competition from imported goods that have already been scheduled under Pacific Islands Countries Trade Agreement (PICTA). More: http://www.bilaterals.org/article.php3?id_article=2376
* Australian PM holds FTA talks with United Arab Emirates (July 26) - Australian Prime Minister John Howard has held talks with officials from the United Arab Emirates on another Free Trade Agreement. More: http://radioaustralia.net.au/news/stories/s1422943.htm
* The rocky road to an FTA (18 June) - FEARS that a free trade agreement with China will wreak havoc in the Victorian manufacturing sector are growing amid company failures and restructuring. When Prime Minister John Howard and Premier Wen Jiabao announced in April their governments would proceed to a second round of negotiations much was made of how a Free Trade Agreement(FTA) would deliver benefits to both countries. However in the past five years, cheap imports from China and other Asian countries have eroded the profitability of many domestic manufacturers. More: http://www.heraldsun.news.com.au/common/story_page/0,5478,15646275%255E664,00.html
* WORLD BANK / IMF NEWS *
* World Bank Policy, As Seen by the Deprived (Jul 21) - Spontaneous clashes have broken out in several Yemeni cities after the government decided to lift all subsidies on oil products. The government's move led to immediate and massive increases in gas and oil prices, hitting the country's poor the hardest. The abolition of subsidies followed intense pressure from the World Bank and the International Monetary Fund on the Yemeni government to limit public spending by cutting subsidies and introducing a sales tax. More: http://www.globalpolicy.org/socecon/bwi-wto/wbank/2005/0721wbpolicy.htm
* Leaks reveal IMF threat to already weak G8 debt deal (15 July) - Debt campaigners today revealed leaked documents that show European representatives at the IMF are suggesting major modifications to last week's G8 debt deal. These could delay or even halt the debt cancellation promised to 18 countries by the G8 and maintain an IMF stranglehold over developing country economies even after they qualify for debt cancellation. More: http://www.wdm.org.uk/news/presrel/current/IMFleaks.htm
* More World Bank Loans Don't Equal Less Poverty - Groups (Jul 14) - World Bank lending to developing countries rose last year by 2.2 billion dollars to 22.3 billion dollars on the back of renewed borrowing from middle-income countries, the Bank said Thursday. Despite the large figures, anti-poverty activists -- long critical of the Bank's operations in developing nations -- charge that more money does not mean better results, especially when the Bank continues to attach counter-productive conditions to its loans. More: http://ipsnews.net/news.asp?idnews=29504
* OTHER GLOBAL TRADE NEWS *
* Backroom Deals Enable DR-CAFTA to Pass (July 28) - International aid organization Oxfam expressed concern today at the midnight passage by the US Congress of the Free Trade Agreement between the United States and Central American countries and the Dominican Republic (DR-CAFTA), as the agreement threatens to throw many poor farmers in Central America and the Dominican Republic into deeper poverty. More: http://www.commondreams.org/news2005/0728-14.htm
* The Hidden Pages of CAFTA (Jul 27) - At 2,400 pages, the Central America Free Trade Agreement (CAFTA) isn't really about trade. Frankly, you don't need 2,400 pages to eliminate tariffs and regulations on exports and imports. But, you might need 2,400 pages to smuggle through a new set of transnational corporate rights disguised by complicated legalese. I wonder, how many of our Congressional representatives will have even attempted to read this trade to me before next week's vote? More: http://www.commondreams.org/views05/0727-33.htm
* U.S. companies sued in Calif. over child labor claims (Jul 16) - A human rights group has sued three U.S. companies in federal court in Los Angeles to force them to step up efforts to end child labor on African farms that supply cocoa beans used to make chocolate products. The International Labor Right Fund filed suit on behalf of former child laborers against Nestle, Archer Daniels Midland Co. and Cargill Inc. on Thursday claiming the companies are involved in trafficking, torture and forced labor of Mali children who were enslaved to work on Ivory Coast farms. More: http://today.reuters.co.uk/news/newsArticle.aspx?type=businessNews&storyID=2005-07-16T023233Z_01_HO609108_RTRUKOC_0_FOOD-NESTLE.xml
* Tell Nestle to End Child Slavery on Cocoa Farms
In addition to being one of the largest chocolate companies in the world, Nestle S.A. is also one of the largest importers of cocoa from regions affected by child slavery. Nestle USA is a subsidiary of Nestle S.A. which through Nestle Cote d'Ivoire owns administrative offices and sales outlet in the Cote d'Ivoire. Click the link below to fax Nestle USA CEO Joe Weller today and demand they take their responsibility for child slavery on their farms seriously by using fair trade certified cocoa: http://www.globalexchange.org/getInvolved/actnow/nestleslavery.html
* Email George Bush and help African Farmers
E-mail George Bush and demand he implement the recent legally binding WTO ruling, which will help West African farmers and their families work their way out of poverty. Click here.
* The World Development Movement (WDM) tackles the underlying causes of poverty. It lobbies decision makers to change the policies that keep people poor. It researches and promotes positive alternatives. It works alongside people in the developing world who are standing up to global injustice.
“We're really not interested in supporting a government that doesn't have open economies and open markets”
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