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Global Trade Watch E-Newsletter #42 - August 2006

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) Good News for (a) Change
3) Upcoming Events
4) Take Action!
5) Global Trade News



* Editorial: Australia Bears Some Responsibility for the Failure of WTO Talks

In case you missed it, the World Trade Organisation’s Doha Round of negotiations collapsed late last month after five years of negotiations. Reflecting on the collapse, a question which should be asked is: what responsibility does Australia have for the failure?

More than a casual observer might imagine, actually.

Why? Well, while some news outlets reported that the blame for the collapse of the latest six-country talks lay equally with the European Union and the United States, both the Brazilian and the Indian trade ministers were more specific - they laid the blame squarely with the US and its point-blank refusal to reduce its huge agricultural subsidies by even a small amount. India’s Commerce and Industry Minister Kamal Nath said that "the U.S. brought nothing to the table." While the EU had agreed to a reduction in trade distorting farm subsidies of 75%, the US had actually lobbied to allow itself to increase its existing subsidies of $19.6 billion by another $3 billion, Nath said.

So what does this have to do with Australia?

Well, in 2004, the Howard Government signed a “free” trade agreement with the US which, while giving it almost everything it wanted in terms of opening the Australian economy to US corporations, didn’t even mention the massive subsidies which the US pays its farmers. US subsidies weren’t even on the table in the US-Australia FTA, even though Australian Trade Minister Mark Vaile kept declaring that from Australia’s end, “everything” was “on the table”.

The willingness of the Howard Government to sign a “free trade” agreement with the US which allowed it not only to maintain many of its import quotas on Australian products, but also made no attempt whatsoever to even try to limit the US’s use of domestic or export subsidies, has shown that the US that it doesn’t need to make compromises to achieve market access gains.

If Australia (and, admittedly, a dozen other countries which have “free” trade agreements with the US) is willing to sign bilateral agreements which give the US everything it wants, while allowing it not only to declare its massive subsidy program “off limits”, but also to continue to maintain quotas on imports, what possible incentive does the US have to give up its subsidies?

The US has been happy to totally ignore all the evidence that their subsidies, by driving farm prices below the actual cost of production for hundreds of millions of small farmers around the world, are one of the major drivers of poverty and environmental damage worldwide. And the Howard Government has allowed the US to continue with this policy by showing them that they can get everything they want through bilateral agreements, without any ever having to consider dropping their own subsidies, and actually having to play on a level playing field.

As the CEO of Bluescope Steel put it so succinctly last month, "We (Australia) are caught up in ideology … in the fantasy that we can lead the world to a free-trade nirvana by unilaterally dropping our tariffs”

And our ideological fantasy is hurting not only our own farmers and manufacturers, but also the billions of farmers in the rest of the world, trying desperately to compete with US farmers subsidised to the tune of US$20 billion every year.



* Consumers (& Greenpeace) Force European Food Giants out of the Amazon

Leading European supermarkets, food manufacturers and fast-food chains, including McDonald's, have pledged not to use soya illegally grown in the Amazon region in response to evidence that large areas of virgin forest are being felled for the crop. In a victory for consumer power, the companies say they will not deal with the four trading giants who dominate production in Brazil unless they can show they are not sourcing soya from areas being farmed illegally. The traders met in Sao Paolo last week and are expected to sign up to a moratorium on using soya grown in the Amazon. The deal has been brokered by Greenpeace which, in an investigation earlier this year, linked the illegal destruction of the forest to large-scale soya farming financed by US-based commodity multinationals Cargill, ADM and Bunge. More...

* Banks Adopt Green Principles

Dozens of international commercial banks and lenders, including global heavyweights like Citigroup, JP Morgan Chase and Standard Chartered, have signed an updated set of environmental and social safeguards that binds them to shoulder more responsible lending in the future. Under the programme, more than 40 international financial institutions have committed to financing only those projects that comply with the Equator Principles (EP), a set of voluntary environmental and social standards that seek to uphold the rights of people displaced by projects and to protect endangered ecosystems. More...




* Mon Aug 14, 6.30pm - Aid, Trade & Debt - Who's really calling the shots? AID/WATCH Forum - The forum will provide an update of recent developments in the World Trade Organisation (WTO), the World Bank and the G20. Speakers: Karen Iles & Damien Lawson (AID/WATCH), Ted Murphy (National Tertiary Education Union) Gareth Commins (Stop G20) WHERE: Evatt Room, Trades Hall, 54 Victoria Street Carlton South. More info: Ph 02 9557 8944 or email debt[at]

* Mon Sept 4, 8.30am-5.30pm - Peak Oil and its effect on Food Security: Re-localising our communities and food systems - While the historic peaking and decline in world oil supply is becoming more widely discussed in the media, it is a bad news story to rival climate change. This one day event with keynote speakers Richard Heinberg and David Holmgren will focus on the opportunity that Peak Oil presents to re-localise our economies & food systems. WHERE: Northcote Town Hall, 189 High Street Northcote. Program and registration form are here.


* August 12, 10am-3:30pm - Teach–In: The G20 and APEC - The G20 group of finance ministers will meet in Melbourne in November 2006. The Asia Pacific Economic Cooperation (APEC) forum consists of countries from the Pacific Rim and will include leaders from the US, China, Japan and Indonesia, and it will meet in Sydney in September 2007. Come along to the teach-in to find why you should be at these meetings. WHERE: UTS (Tower Building, Broadway and follow the signs). Lunch will be provided. Plenary Session – What is the G20 and APEC. What relevance do they have to global governance. How have activists approached the G20 and APEC in the past. Speakers: Patricia Ranald (Afti-Net), Karen Iles (AID/Watch) and James Goodman (UTS). Workshops run by Greenpeace, AID/Watch, AFTInet, Australian Student Environment Network, Make Poverty History. Information stalls from NGO’s and Community Activists. More info: Karen at AID/Watch 02 9557 8944.

* Wednesday August 16, 6.30pm - Trade Justice Dinner for the Australian Fair Trade and Investment Network - Feast on a delicious four-course Chinese banquet with vegetarian options, and support trade justice in Australia. MC: Julian Morrow, from the ABC’s Chaser’s War on Everything. Speaker: Sharan Burrow, President, Australian Council of Trade Unions and President of the International Confederation of Free Trade Unions. Auctions: Cartoon by Bruce Petty, painting by Rachel Szalay. Raffle prizes of fair trade products and wine. Price: $55 per person. Where: Marigold Restaurant, Level 5, 683 George St, Sydney 2000. Bookings close August 9. For more, email jemma[at]

* Please email in your upcoming events!



* Tell KFC to stop trashing the Amazon

Despite repeated requests from consumers, KFC have refused to agree to, or even comment on, a ban on the use of soya grown in deforested areas of the Amazon. Thanks to people like you taking action (and to Greenpeace), McDonald's and other food companies have made a big commitment to help protect the Amazon by instigating a moratorium on Amazon soya, so why can't the Colonel? The moratorium will only succeed if we get as much support as possible, so getting a company the size of KFC, and its parent company, Yum! Foods, involved is vital. They can put pressure on their suppliers and insist on a complete ban on chickens fed on Amazon soya as well as other Amazon soya products. Please email David Fitzjohn, KFC's Managing Director for Europe, and tell him to stop trashing the Amazon.

* Tell Fila to support the rights of workers in its factories

As part of their ongoing campaign to support the rights of workers everywhere, Oxfam wants your help. They recently released a report on respect for labor rights in the sportswear industry in Asia. This report found that many of the workers - most of whom are women - who make sportswear garments and shoes face dismissal or threats of violence if they try to organize unions to negotiate for better wages and conditions. A US sportswear company, Fila, was ranked among the worst of the 12 companies in the report because it has failed to address serious labor abuses. Please sign the petition asking Fila to address labor abuses in its factories.




* WTO: Best Left For Dead? (Aug 8) - For the world's poor, the WTO's slip into a vegetative state is cause for rejoicing. The indefinite suspension of the trade talks represents a clear victory for the global justice movement, which visibly rallied against WTO ministerials over the past eight years in Seattle, Cancún and Hong Kong. Yet stalemate at the WTO presents new threats as well. More...

* WTO: time to pull down shutters (5 Aug) - Nearly 11 years after the WTO came into existence, as the impasse over a multilateral trade regime continues, it is the ‘development’ aspect that has been sacrificed at the altar of international trade. To the developing countries, the WTO offers hardly any promise of development, but in reality puts millions of jobs in the manufacturing sector at risk. In agriculture, it promises to turn a majority of the developing countries into food importers thereby playing havoc with food security and adding to global poverty and hunger. More...

* It will take years to revive trade talks (Jul 31) - The myths about the Doha Development Round are legion. One is glaringly obvious - that it has anything to do with development. The rich countries paid lip service to this idea in order to get the talks started back in 2001, then settled down to business as usual. That means cutting the best possible deal for themselves. More...

* Mandelson: US greed caused the Doha collapse (July 30) - Peter Mandelson, the EU Trade Commissioner, has accused America of trying to exact a 'disproportionate' price from developing countries in the Doha trade round, which fell apart in a frenzy of finger-pointing last week. More...

* For George Bush, a fair deal means what American farmers demand (Jul 30) - Developing countries have lost out again, and could next suffer under new one-to-one deals with more powerful nations. More...

* Indefinite Suspension of Doha Round WTO Expansion Negotiations Creates Opportunity to Rethink Current Global “Trade” System (Jul 24) - It’s not surprising that the Doha World Trade Organization (WTO) expansion talks have collapsed. The cause of this collapse is not specific countries’ unwillingness to concede on particular themes, but growing public opposition in poor and rich countries alike to the very WTO model based on a decade of peoples’ experience of this system’s damaging outcomes. More...

* The death of Doha signals the demise of globalisation (Jul 13) - As developing countries acquire a powerful voice, the US shuns multilateral trade deals because it can no longer get its own way. More...

* WTO TRIPs Proposal Would Address Biopiracy (Jul 06) - Poor countries want new rules for the WTO's intellectual property agreement that would protect their biological resources and traditional knowledge. The U.S. and other rich countries want to block the proposal. Download a fact sheet from IATP here.



* Cabinet rift over China trade deal (Aug 7) - Cabinet is split over whether to abandon tariffs protecting Australia's clothing and motor vehicle industries from cheap Chinese imports. Senior Coalition figures, including Industry Minister Ian Macfarlane and Finance Minister Nick Minchin, are challenging Deputy Prime Minister Mark Vaile over his proposal for a wide-ranging free trade agreement with China. More...

* Vaile floats idea of Asian FTA (Aug 3) - Australia could join an Asia-wide free trade bloc or create its own deal with other free-trading nations across the globe. Trade Minister Mark Vaile has floated at least two options for Australia if the current round of World Trade Organisation (WTO) negotiations collapse. More...

* FTA threatens blood supply: study (Jul 14) - The safety of the Australian blood supply could be jeopardised under the free trade agreement with the United States, researchers have warned. Under the FTA, the federal government agreed to recommend to the states and territories that Australia's blood product arrangements be opened up to overseas tender. But researchers at the Australian National University have warned that transporting plasma over longer distances would leave it vulnerable to error and loss. More...

* BlueScope questions value of China FTA (Jul 15) - A leading manufacturer has started ringing the alarm bells over the rapid shrinking of Australia's manufacturing sector and labelled the Federal Government's trade policies as naive. BlueScope Steel CEO Kirby Adams also warned strongly against entering a free trade agreement with China unless imbalances in the current trading relationship were corrected. More...

* Australia to Consider Free Trade Talks (Jun 21) - Australia will consider negotiating a free trade agreement with several Middle Eastern countries, including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates, Deputy Prime Minister Mark Vaile said Wednesday. More...



* Bertone slams IMF and World Bank "usury" (Aug 9) Pope Benedict XVI's choice as the next secretary of state, Cardinal Tarcisio Bertone, has said in an interview that he considered international lending by the World Bank, the International Monetary Fund and by richer countries a form of usury that "should be declared illegal." "Some technocrats, especially those of multinationals, the World Bank and the (International) Monetary Fund, have imposed unacceptable conditions on the poor populations, like forced sterilization and obligatory closing of Catholic schools," he said. More...

* IMF Chief Previews New Focus on Poor Nations (Aug 1) - The International Monetary Fund (IMF) says it is moving to give poor nations greater say and representation on its board of directors and to refocus its work to help prevent financial crises in those nations. More...



* Islanders Win Appeal in Claim Against Rio Tinto (Aug 7) - A U.S. appeals court on Monday reinstated a human rights claim brought by Bougainville islanders in Papua New Guinea against international mining giant Rio Tinto. The Ninth Circuit Court of Appeals in San Francisco ruled the case may be heard in the United States. The suit claims that London-based Rio Tinto conspired with the government of Papua New Guinea to quell civil resistance to an environmentally devastating copper mining operation, actions that led to the deaths of thousands. More...

* The Enduring Racket: Why the Rich Won't Budge on 'Farm' Subsidies (Jul 28) - Although the UK government has publicly condemned the "scandal and waste" of the EU's Common Agricultural Policy (CAP), farm unions and alliances hold enough sway over EU decisions to prevent significant reductions in the "bizarre" levels of support that go to large farms. More...

* Vandana Shiva: WTO is Dead, Long Live Free Trade: Globalisation & its New Avatars (26 July) The Doha round negotiations collapsed once again at the Mini Ministerial in Geneva on 23rd July 2006. The US is being identified by all as responsible. The US and its corporations were the driving force behind two agreements of the Uruguay Round, which have the highest impact on the poor of the Third World. The Trade Related Intellectual Property Rights (TRIPS) Agreement and the Agreement on Agriculture (AoA) have destroyed the agricultural livelihoods of millions of peasants and food security of the world’s poor. More...

* Globalization and Growing Disparities (Jul 7) - For two decades, "protagonists" of the Washington Consensus have promised that neoliberal policies would soon make everyone better off. Yet, these policies have failed in reducing hunger, malnutrition and poor health conditions. Inequality keeps rising. Some Latin American countries, on the other hand, "have begun prospering only after discarding the Washington consensus." More...

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