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Global Trade Watch E-Newsletter #38 - March 2006
NB: This is an archived newsletter. Information may no longer be current, and links to other sites may not always work.
* Editorial: Seeing Through the Lies About “Free Trade” in Agriculture
If you’re an Australian farmer, the future isn’t looking good, despite what the National Party, the National Farmers Federation, and the government constantly say about all the coming benefits of “free trade”. Last month, Australia’s commodities forecaster ABARE (the Australian Bureau of Agricultural and Resource Economics) again added its voice to this chorus in producing a set of estimates purporting to show how much Australian farmers will gain from increased liberalisation of agricultural trade (“free trade”) under the World Trade Organisation’s (WTO) current negotiations.
ABARE predicts that a successful Doha Round of WTO negotiations will increase Australia’s agricultural exports by between 3 and 15%. The “big” winners from this, according to ABARE, and Beef, dairy products, sugar and wheat farmers, who will all increase their incomes as a result. Beef farmers would gain between 1% and 8% increases in gross incomes; dairy farmers between 2% and 6%, sugar farmers between 1% and 12%; and wheat farmers between 4% and 9%.
Ignore, for the moment, the miniscule size of these predicted income increases. (And ignore, for the moment, the fact that just last year Australia’s Trade Minister Mark Vaile claimed that trade liberalisation would result in “Income gains [for farmers] of between 50 and 65 per cent”. Ha Ha!) Concentrate instead simply on the claim that farmers will benefit from further trade liberalisation, because it’s a claim which has been made for over 30 years, since trade barriers began to be dismantled in the 1970s.
Now look at the reality. Since the 1970s, successive federal governments have almost completely liberalised Australia’s agricultural sector - removing tariffs of around 30% in 1973, to effectively 0% now. But during this same period, in concert with falling trade barriers, farmers incomes have fallen quite dramatically. In 1973, (when tariff reductions began) farm incomes, as measured by the “real net value of farm production” (the value of farm production, minus costs, adjusted for inflation) were at a high of almost $20 billion (in 2004/5 dollars). Since that time, it has gradually fallen to just $6.6 billion in 2004/5 - just *one third* of its real value before trade liberalisation began. That’s a 66% DROP in income over the 30-odd years of trade liberalisation.
And if you look more carefully at the predictions from ABARE, what they tell you is that this trend is set to continue. That’s because the figures cited above (and in the media) are a bit of a fraud: the predicted increases above are based on a “reference case” - a prediction of what would happen if there was no global trade reform. But can you guess what the reference case shows? According to ABARE, the real net value of farm income is actually due to decline from $5.8 billion in 2004/5 to $3.9 billion in 2011 (in 2005/6 dollars). That’s another massive 50% drop in farmers’ incomes in the next five years! In comparison, those rises of 1% to 12% look pretty bloody miniscule.
Perhaps its time for Australia’s farmers to wake up to the reality of what “free trade” really means for them. The problem is that while the media reported the predicted income rises of 1%, 2% and 4%, no one bothered to report the predicted underlying 50% fall in farm income anywhere.
(The data used above is taken from “Australian Commodities: March quarter 2006” and “ABARE Commodity Statistics 2005” available at www.abare.gov.au)
* UN Upholds Moratorium on Terminator Seed Technology
Thanks in part to the lobbying of literally millions of farmers and ordinary people around the world, governments at the United Nations Convention on Biological Diversity (CBD) have unanimously upheld the international de facto moratorium on Terminator technology - plants that are genetically engineered to produce sterile seeds at harvest. The 8th meeting of the CBD ended today in Curitiba, Brazil.
"The CBD has soundly rejected the efforts of Canada, Australia and New Zealand - supported by the US government and the biotechnology industry - to undermine the moratorium on suicide seeds," said Maria Jose Guazzelli of Centro Ecologico, a Brazil-based agro-ecological organization.
"By consensus decision, all governments have re-affirmed the moratorium on a genetic engineering technology that threatens the lives and livelihoods of 1.4 billion people who depend on farmer-saved seed," said Pat Mooney, Executive Director of ETC Group.
The CBD's moratorium on Terminator, adopted six years ago, was under attack by three governments - Australia, Canada and New Zealand - that insisted on a "case-by-case risk assessment" of the technology. A broad coalition of farmers, social movements, Indigenous peoples and civil society organisations pressed governments meeting in Brazil to reject the controversial text because it threatened to open the door to national-level field testing of Terminator, without regard for its devastating social impacts.
* April 5, 2006, 6:45 - 2006 World Social Forum Review Night - Jose Ramos has recently returned from Caracas, Venezuela, where he took part in one of the 2006 Polycentric World Social Forums along with 80,000 other participants. Come along for a night filled with stories and pictures from the most recent gathering of the world's fastest-growing global network for social and environmental justice, and find out how you can get involved right here in Melbourne. Participants from the 2004 WSF in Mumbai, India and the 2005 WSF in Porto Alegre, Brasil will also be on hand to spark discussion about the Social Forum movement: past, present, and future. WHERE: Oscar Oeser room, 11th floor Redmond Barry Building (off Tin Alley), University of Melbourne (Parkville). NB: Late-comers will unfortunately be locked out.
* 20-22 April 2006 - Community Development in a 'Global Risk Society' conference - A three day conference for academics, researchers, community development practitioners and practitioner activists, presented by the Centre for Citizenship and Human Rights, Deakin University, in conjunction with Borderlands Co-operative & the Int. Assoc. of Community Development. There will be two separate streams to the conference running concurrently - academic papers and community workshops & forums. More info...
* Wed April 26, 6:30pm - Globalisation: The Changing Nature of Power - A public forum organised by the Australian Fabian society. Paul James offers new insights into "Globalisation: The Changing Nature of Power', in the second of three presentations by the editors of Arena Journal. This talk will attempt to develop the outlines of an approach for understanding the historically-changing structures of globalisation and the increasing abstraction of social power, including areas of finance-capitalism, electronic communication and hi-tech militarism. WHERE: New International Bookshop Centre, Trades Hall, Cnr Lygon and Victoria Streets, Carlton. AFS members $6, non-members $8, concession $3.
* 5-7th May - "Strengthening ties in the fight for fair trade": The Inaugural National Student Fair Trade Conference - This is the inaugural National Students for Fair Trade Conference, and will bring together Australian students for workshops, speakers, debates, documentaries and theatre performances about the critical issues surrounding global social and economic inequality. Supported by Oxfam and the Fair Trade Association, the conference will seek to expose the dark realities of a global "free-trade" economic order, from which arises the existence of drastically unequal living standards between the "Developed" and "Developing" world. In particular, there will be a focus on the plight of small-scale farmers in the globally traded commodities of coffee, chocolate and tea, with guest speakers including Papua New Guinean Coffee Farmers from the Highlands Organic Coffee Cooperative, enabling students to hear directly from those most affected by the vagaries of oscillating world prices and how we as consumers in the West can respond and make a difference. For more info and registration details, visit http://conference.hooked.org.au
* Fri 7 April, 9am - 5pm - 'One year on: Pulling back the curtain on the US FTA' - A one day seminar with leading Australian academics, policy workers and campaigners on the impacts of the US FTA and the continuing campaign. The aim of the seminar is to share information and research on the emerging social and environmental impacts of the US FTA and to provide a forum for campaigners, policy workers and researchers to discuss the future campaigning opportunities. WHERE: Level 11, PSA House, 160 Clarence St, Sydney. Cost: $66 full price / organisation / $27.50 concession. Please RSVP to [email protected]
* Please email in your upcoming events!
* Review of the Export Finance and Insurance Corporation
The Trade Minister has announced a review of the Export Finance and Insurance Corporation (EFIC). EFIC is a self funding statutory corporation which provides finance and insurance services to support Australian exporters and overseas investors where the private sector lacks capacity or willingness to help. The Australian Government is seeking public submissions on EFIC’s activities by 21 April 2006.
EFIC funds a variety of environmentally and socially damaging industries around the world, especially the projects which commercial banks won’t go near! For instance, EFIC is currently providing insurance for the construction of the BLCP Coal Fired Power Plant in Thailand to be built at Map Ta Phut, Rayong Province, even though coal is the most polluting and greenhouse-gas intensive of all power sources. EFIC has minimial social or environmental standards for projects which it funds. You might like to suggest that this is not good enough.
Submissions can be lodged electronically to [email protected] (Word documents preferred) or by post to Trade Finance Section, Trade Development Division, Department of Foreign Affairs and Trade, BARTON ACT 0221
The terms of reference can be accessed along with further information on the review at: www.dfat.gov.au/trade/export_finance_policy.html
You can find more information about EFIC’s activities from Australian NGO Aid/Watch here: http://aidwatch.org.au/index.php?current=43
* WORLD TRADE ORGANISATION NEWS *
* No Patents Without Local Consent, Delegates Urge (Mar 31) - Delegates from developing countries attending an international conference on biodiversity in Brazil are demanding changes in the WTO rules which deal with patenting of genetic resources, such as seeds, plants and animals. More...
* Trapped by the WTO (Mar 28) - "More than 30,000 farmers from India have committed suicide over the last five years!" says one participant at a World Social Forum discussion on the post-Hong Kong World Trade Organisation (WTO) ministerial summit. Yet another claims that the total figure of self-inflicted deaths of poor farmers in South Asia stands at “more than 2.5 million” to date. More...
* Poorest Nations Hit Hardest by WTO Agenda, Study Finds (Mar 15) - Developing nations are likely to end up being net losers under the current global trade agenda because they do not have the agricultural or industrial capability to compete with the United States, Japan, Europe or even China, the expected winners, a new study says. More...
* Blair was right, the striptease summit was embarrassing (Mar 13) - The latest WTO talks between the US, EU, Australia, Brazil, India and Japan have failed to break the impasse over freeing up global trade. More...
* A deceitful deal (Mar 8) - Developing countries are about to agree to a new set of global trade rules that will do their economies enormous damage, warns Aftab Alam Khan of ActionAid International. More...
* Critical WTO Negotiations Go Underground (Mar 8) - As the trade negotiations following the WTO conference in Hong Kong intensify, rich countries discuss many of the remaining issues in small and exclusive conferences. These arrangements further undermine poor countries' ability to benefit from the Doha trade round. More: http://www.focusweb.org/content/view/842/36/
* Big Business Lobbyists Have Undue Influence on Trade Talks (Jan 24) - Corporate lobbyists have an undue influence on the current global trade talks, says a new report by ActionAid International. The report, “Under the Influence”, reveals a worldwide explosion of corporate lobbying, contributing to unfair trade rules that undermine the fight against poverty. More...
* BILATERAL AND REGIONAL FREE TRADE AGREEMENTS NEWS *
* Agriculture deal with Malaysia opens door for FTA (Mar 10) - Australia and Malaysia have signed a memorandum of understanding that aims to foster trade in agriculture, food processing, livestock and fisheries. More...
* Australia, US hold formal review of FTA (Mar 8) - Australia and the United States both say a free trade agreement has boosted each other's economy, but they have used a review of the deal to block major changes in sensitive products. More...
* US wants AWB monopoly scrapped (Mar 8) - The US Government has used its annual trade talks with Australia to reiterate its call for the Australian wheat export monopoly held by AWB to be scrapped. More...
* WORLD BANK / IMF NEWS *
* Total Debt Cancellation: 'We Don't Owe Them Anything' (Mar 29) - Over a hundred countries in the developing world have taken to neo-liberal policies thanks to the insistence of creditors from the North, including the G8, the World Bank, and the International Monetary Fund. But after 20 years, it is clear that these policies have not worked. The poor are poorer with their governments spending a lot of money to pay back loans, activists say. More...
* Latin America Unchained (Mar 16) - After decades of promoting privatization and market liberalization throughout Latin America, the International Monetary Fund (IMF) and its biggest shareholder, the US, are loosing influence over national politics in the region. More...
* Unable to Vote with One's Feet? Developing Countries and the IMF (Mar 2) - Poor countries highly depend on the IMF's evaluation of their macroeconomic policies, not only to get affordable loans from the fund but also to receive development assistance from rich countries. However, many development experts agree that the "one-size-fits-all approach" and the strict macroeconomic conditions requested by the IMF can undermine a country's ability to grow. This article calls on the IMF to provide countries with a range of political options they can choose from, and allow them to participate in the fund's decision making. More...
* OTHER TRADE & GLOBAL JUSTICE NEWS *
* Taming Global Capitalism Anew (March 30) - Joseph E. Stiglitz, Thea Lee, Will Hutton, James K. Galbraith, Jeff Faux, Joel Rogers, Marcellus Andrews & Jane D'Arista offer their ideas on how the United States, as the major capitalist country and the major player in globalization, could reshape both capitalism and globalization in ways that build a new social contract serving the needs of working people everywhere. More...
* Political Struggles Will Determine Better Globalisation (Mar 15) - This South Centre publication offers a historical-sociological background on the neoliberal influence on globalization. It looks at four interrelated forces that have generated and sustained neoliberalism since the late 70s, namely governance, production, knowledge and social networks. Focusing on the exclusive nature of social networks supportive of neoliberalism, the article calls for a broader advocacy of alternative ways to shape globalization. More...
* Revitalizing UNCTAD (Feb 20) - Although United Nations Conference on Trade and Development (UNCTAD) policies enjoyed strong support from poor countries for decades, rich countries have dismantled the organization’s efforts to “build a stable, viable and genuinely democratic international community.” In this South Centre report, former UN Secretary General Boutros Boutros-Ghali describes the necessary steps to turn the organization back into a platform that promotes equality and sustainable development among all countries. More...
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