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Global Trade Watch E-Newsletter #33 - August 2005

NB: This is an archived newsletter. Information may no longer be current, and links to other sites may not always work.


1) News from Global Trade Watch
2) Upcoming Events
3) Global Trade News
4) What Can You Do?
5) Website of the Month
6) Quote of the Month



* EDITORIAL: Ugly Realities of US Free Trade Agreement Start to Show

The first evidence of the negative impacts of the US-Australia “Free” Trade Agreement (FTA) signed last year has begun to trickle in.

To start with, the FTA seems to actually be pushing Australia deeper into debt (as many economists predicted last year). Last year the government sold the agreement by claiming that the FTA would increase 2005 exports by $1 billion, or 10 per cent. But a parliamentary inquiry has been told that even with record commodity prices, Australia’s exports to the US fell by 3% in the first 6 months of operation of the US-Australia FTA’s, significantly worsening the trade deficit. Over the 12 months to June this year, Australia’s exports to the US fell by a huge $9.4, while the US again increased its exports to Australia by $2. (Australian exports to the rest of the world rose by 16% though).

Dare we say “we told you so”?

To add insult to injury, Australian scientists are also worried that the US-Australia FTA could effectively doom the Australian stem-cell research program, ending life-saving research and destroying the income which Australia might have gained from the research. Australian public universities are currently exempt from having to pay royalties to corporations when they work on patented things (like some stem cell processes). But Dr Thomas Faunce, a senior lecturer at the Australian National University medical school and law faculty, has pointed out that the US-Australia FTA forces the Australian government to harmonise its Intellectual property laws with those of the US, where university researchers have to pay royalties to patent holders. This could mean that Australian public universities will soon be forced to pay the same royalties, effectively making much research too expensive to pursue in Australia’s (underfunded) universities.

The Howard government has tried to deny the claims by arguing that “harmonisation” could mean that the US adopts our IP laws, rather than forcing us to adopt theirs. What a joke! This government still hasn’t learnt from the FTA negotiations last year when the US showed how impossible it is to negotiate with a superpower and win. The reality is that US government is devoted to the interests of US corporations, and they are the ones which stand to win by forcing Australian universities to pay patent royalties. US Sentator John Edwards summed it up recently: “"He's all for free trade, but knows nothing about fair trade, with labor and environmental standards. Every time there's a choice, Bush will stand with corporate America,"

And finally, the only people who seem to be doing well out of the FTA so far are US lobbyists who were paid $1.5 million of Australian taxpayers money to lobby the US Congress to pass the agreement, according to foreign minister Alexander Downer.

(For links to articles outlining these FTA impacts, see the “US-Australia FTA News” section below)

* AID/WATCH Briefing Paper: ABC of the ADB (Asian Development Bank)

Want to know more about the workings of the International Financial Institutions that are the engines turning the cogs of 'development' policy and practice? Get an introduction to the ADB with this new briefing paper from Australian Aid watchdog AID/WATCH. Download the full paper here.

* John Kenneth Galbraith

ABC Radio’s background briefing recently featured a fantastic look at noted US economist John Kenneth Galbraith. If you’re interested, read a transcript here or download the audio here.




* 10 Sept - Oxfam urges Australians to Make Poverty History - On 10 September, Australians will again join with the rest of the world to fight the global injustice of poverty for the second white-band day, in the lead up to the UN Millennium +5 Summit in New York. Details here.


* 19 & 20 Nov - The Melbourne Social Forum: Your World, Your Future - The Melbourne Social Forum is an annual open space event, and a network for facilitating debate, self-expression and imagination in addressing global issues. In particular for seeking out, articulating and helping to establish more sustainable and just versions of globalisation. WHERE: CERES Environmental Park (8 Lee St, Brunswick East). How Much: Two days $20/ $15 conc, One Day $15/ $10, Organisational $50 – stall & 3 tix. More info: or [email protected]




* US lobbyists making money from FTA (Aug 23) - There have already been some big winners out of Australia's free-trade deal with the United States - American lawyers and lobbyists. Foreign Minister Alexander Downer, in answer to a question from his Labor counterpart Kevin Rudd, has revealed the government spent $1.5 million on US-based lobbyists and lawyers to get the deal. More...

* US deal may hurt stem cell research (23 Aug) - The free trade agreement (FTA) with the US could stifle Australian stem cell research, scientists and legal experts say. Dr Thomas Faunce, a senior lecturer at the Australian National University medical school and law faculty, said he was concerned about the impact of the deal at a recent public forum on stem cells hosted by Sydney's Garvan Institute. More...

* No easy ride in the land of the FTA (Aug 20) - It was meant to be the big breakthrough for Australian exporters — but official statistics show Australia's exports to the US have fallen by 3 per cent since the start of the US free trade agreement. With record commodity prices lifting Australia's export earnings by 16 per cent this year, and an agreement that was meant to let us "dock into the world's most dynamic economy", why have exports to the US gone backwards? More...

* U.S. gains in one-sided trade deal (20 Aug) The much-vaunted free trade agreement with the United States has become one-sided, with no financial benefit to Australia. Income earned by the U.S. through imports to Australia has increased by $724 million in the first six months after the deal came into effect on January 1 this year. But for Australia, exports to the U.S. have slumped by $123 million, or 2.7 per cent. More...

* Trade agreement may weaken quarantine (Aug 6) - The Australia-United States Free Trade Agreement (FTA) could bring more pressure on Australia to reduce quarantine standards and allow US imports of unlabelled genetically modified food, say experts in environmental law and international relations. More...



* Benefits and costs of FTAs (Aug 29) - More developing countries are now engaging in bilateral free trade agreements with developed countries. Often, these FTAs contain issues that the developing countries have rejected in the WTO, and oblige developing countries to cut their tariffs more steeply and open up their service sectors. The effects can be devastating, as the case of Mexican agriculture shows. More...

* Companies concerned over China FTA (18 Aug) Australian companies have raised serious concerns they may not be able to surmount Chinese regulations and restrictions ahead of the first in-depth free trade negotiations between the two countries. From the policing of intellectual property piracy to the way provincial Chinese governments make their own interpretations of rulings made by Beijing, companies fear they may not make inroads into the Sino economy even with a free trade agreement (FTA). More...

* A Toxic Trade-off (Aug 14) - Pressing for passage of the Central American Free Trade Agreement at a White House news conference in May, President Bush made the case that a vote for CAFTA was a vote for democracy. But lawmakers who voted to pass CAFTA in late July may not have realized that a part of the trade agreement threatens to do just the opposite thanks to "investor-state arbitration" provisions actually hand foreign businesses powerful rights that trump the interests or desires of local citizens. More...

* Big Pharma's free ride (Aug 12) - Pharmaceutical companies are using free-trade deals like CAFTA to eliminate global competition -- and deny poor patients access to cheaper generic drugs. More...

* U.S. poised for trade war (11 Aug) - Washington says it has no plans to obey a NAFTA ruling that compels the United States to refund an estimated $5-billion in illegally collected duties to Canadian lumber producers — setting up a potential trade war that experts say could threaten the future of the North American trading bloc. More...

* Trade panel rejects Canadian firm's challenge to Calif MTBE ban (Aug 10) - An international trade tribunal has rejected a Canadian company's challenge to California's ban on the gasoline additive MTBE under the North American Free Trade Agreement. Methanex Corp., which produces an MTBE component called methanol, had filed a $970 million claim against the United States under NAFTA six years ago. More...



* Promises, Promises (Aug 22) - In Cancun, Mexico, in September 2003, a bloc of poor nations, led by West African countries upset about US cotton subsidies, helped torpedo an international trade deal. Big business on both sides of the Atlantic dearly wants a trade pact that liberalizes the rules on manufactured products and services. But for poor countries, the process of compromise has been a one-way street for more than half a century. It's time for the rich world to start doing a little compromising. More...

* In the Name of Development: Whose Ambitions for the Doha Round? (Aug 19) - The Uruguay Round results have shown that opening markets in countries without a stable fiscal and political system worsens economic and social conditions. Nevertheless, the next WTO Ministerial Conference in Hong Kong in December 2005, will involve negotiations over the liberalization of agricultural products, industrial products, raw materials and service providers. Rich countries do not favor trade rules that reflect the interest of the majority of WTO members, and that means those who need the most actually stand to lose the most. More...

* SADC to raise agriculture, textile, patent issues at WTO meeting (Aug 14) - Southern African countries will fight for greater market access of farm products, negotiate less inflow of textile commodities from Asia and obtain cheaper AIDS medicines when world trade ministers meet in Hong Kong late this year. More...

* The Caribbean faces prospect of a life without sugar (Aug 14) - Two months ago, the European Union announced its intention to cut the price it pays for the sugar produced in Guyana and 17 other poor countries from the Caribbean, Africa and the Pacific by 39 per cent over the next five years, plunging the depressed industry into even deeper uncertainty. The EU price cuts could severely damage the industry in the Caribbean. Reductions to the EU sugar price are part of a broader market reorganisation demanded by the World Trade Organisation. More...

* Planting the Rights Seed: A human rights perspective on agriculture trade and the WTO (Aug 05) - This publication is the first in a series designed to analyze the WTO Agreement on Agriculture from a human rights perspective. It focuses on the characteristics of agricultural trade and the relevant global rules. It points out what the main human rights concerns are, and suggests some actions human rights advocates can undertake to support efforts towards a fairer international agriculture system. Full Report...

* Midnight traders (26 July) - The battle between the neo-liberal free-trade agenda and the campaign for global trade justice resumes at the Geneva meeting of the WTO general council from 27 July. More...



* How the G8 lied to the world on aid (Aug 23) - World leaders are now preparing for the millennium summit to be held in New York next month, described by the UN as a "once-in-a-generation opportunity to take bold decisions". Yet the current draft outcome simply repeats what was agreed on aid and debt last month in Gleneagles. The reality of that G8 deal has recently emerged - and is likely to condemn the New York summit to be an expensive failure. More...

* IMF and EU Are Blamed for Starvation in Niger (Aug 1) - Rich country governments could have acted to prevent the hunger crisis in Niger but donor nations ignored the World Food Programme's first call for funds for Niger in fall 2004, says the Independent. Instead, the International Monetary Fund and the European Union pressed Niger to introduce a 19 percent tax on foodstuffs, making food more expensive and contributing to the hunger crisis. More...



* Bangladesh in the grip of globalised trade (Aug 2005) - Globalisation in Bangladesh means manufacturing clothes and raising shrimps for western markets. This has caused poverty and human rights violations. Representative democracy has broken down; Bangladeshis are turning to voluntary associations to practise direct democracy. More...

* Coke plant ordered shut in south India (29 Aug) In a major setback for the Coca-Cola company, the Kerala State Pollution Control Board has ordered the company's bottling plant in south India to "stop production of all kinds of products with immediate effect." The Plachimada bottling plant, one of Coca-Cola's largest, has been shut down since March 2004 because of community opposition. The community is experiencing severe water shortages and the groundwater and soil have been polluted - directly as a result of Coca-Cola's operations. More...

* The UN can help business help itself - (Aug 18) - What minimum human rights standards should multinational corporations have to adhere to? And how can these be guaranteed internationally even if individual states are unable or unwilling to enforce them? This month the United Nations secretary general, Kofi Annan, appointed John Ruggie, a Harvard professor, to find answers to these difficult questions. More...

* Dumping on economic vandals (Aug 12) - Dumping is a form of economic vandalism. The free traders have focused their argument on the theoretical imperative of ensuring consumers have access to products at prices resulting from the most efficient and economic processes of manufacture. They argue that the removal of tariffs and other trade distortions ensures allocation of scarce economic resources is neutral and only the most efficient and competitive companies survive as suppliers. Dumping makes a nonsense of this theory. More...



* 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 here 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.

* 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.



* NAMA Watch - This new website to monitor the WTO’s non-agricultural market access negotiations at the WTO has been launched by ActionAid, Friends of the Earth and War on Want.  Decisions made in these negotiations threaten to limit the space for regulation in the public interest and could have major impacts on developing countries and the environment.  For example, is has been claimed that regulations on food labelling, energy efficiency labelling and limits on the use of some hazardous chemicals are barriers to trade:



“Trade liberalization in the name of 'free trade' during the last decade under the WTO regime has been fundamentally flawed with disastrous results to the poor countries;

. . . during the last decade, poor nations have been forced to submit to market fundamentalism and have been coerced through various agencies into opening their markets to foreign corporations and foreign produce, privatizing their services and abandoning the measures which helped small domestic companies to compete with overseas competitors;

. . . while weaker trading nations have been repeatedly promised that every concession that they make to free trade will be matched by similar concessions by the powerful nations, every time the rich world has responded by breaking almost every promise it has made.”

- Declaration of the members of the South Asian Parliaments assembled in Islamabad, Pakistan, 29-30 August 2005, for the South Asian Parliamentarians Forum on WTO Hong Kong Ministerial.)

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