“What we have to do is get our locals to pressure their MPs and they must tell the negotiators to keep public services out of the FTAA. The pressure has to come from the bottom up. The only reason they negotiate these deals is because they can. Someone’s pushing them to do it and there has to be someone pushing them not to.” Rick Macmillan, General Vice-President, Canadian Union of Public Employees.
Introduction
In order to prevent another disastrous round of trade talks, trade ministers from across the Americas issued a declaration that cannot hide the failure of the United States and Canada to get what they came for. Unable to conclude a “comprehensive deal” over the objections of Brazil, Argentina and Venezuela among others, trade ministers issued a radically scaled down declaration and went home one day early.
Over Canada’s objections, the ministers accepted the idea that some countries will have greater or lesser market access, depending on their commitments to ‘new’ issues that are not so much about trade but are about guaranteeing the rights of investors.
The Canadian government went into the negotiations intent on including a far-reaching list of services in the FTAA. It allowed labour and environmental issues to be taken off the table. Canada also rejected a proposal to guarantee each State’s capacity to formulate public policy for the well-being of its people.
Under a climate of militarization and police repression, representatives from social movements across the Americas gathered outside the perimeter in parallel meetings and demonstrations. Brother Hassan Yussuff, Secretary-Treasurer of the Canadian Labour Congress spoke at the rally. He asked everyone to consider how much repression is needed to get these deals passed. ‘What is it that they are doing in there, behind closed doors anyway? What are they doing that justifies this outrageous police presence?’ he asked.
Background
In the lead up to the FTAA meeting in Miami, it was clear that Brazil and the United States, co-chairs of the FTAA talks, were at an impasse. While the United States (and Canada) were intransigent on the drive towards a “high end” agreement or nothing, Brazil was unwilling to accept the so called “new” trade issues such as intellectual property rights, Chapter 11 investment and government procurement issues in the trade deal. From Brazil’s point of view, agricultural subsidies in the United States, anti-dumping regulations as well as access to the U.S. market were the key issues to be dealt with in Miami, yet they were taken off the table by the U.S. (1)
The United States position was weakened by the recent failure of WTO talks in Cancun, Mexico and the possibility that the FTAA would not succeed during an election year.
Argentina, facing profound economic crisis after more than a decade of neo-liberalism, as well as Venezuela, were close to the Brazilian position, and other South American countries wanted to slow down the process. (2) The U.S. trade representative Robert Zoellick, spared no effort in characterising Brazil as a rogue on trade issues, and threatened a re-invigorated pursuit of bilateral deals with “can do” nations across the hemisphere if multi-lateral talks broke down. Under pressure from the U.S., Colombia, Costa Rica, Ecuador, Guatemala and Peru left the alliance with Brazil and Argentina. (3)
Despite its concern that the ministerial would turn out to be a failure, Canada was seeking “guidance and instructions from Ministers in support of a comprehensive, high-quality agreement”. (4) Canada, as well as Mexico and Chile came out in favour of a multilateral agreement dealing with nine subject areas to be achieved by January 2005.
This ‘NAFTA on Steroids’ agenda has been roundly criticized by alliances of labour and other social movements. The objectives of trade activists from across the hemisphere was to oppose the FTAA and propose alternatives on poverty reduction, living wages, workers’ rights, privatization, democratic and transparent trade negotiations, citizen participation, food security, gender issues and sustainable development policies. (5)
A large coalition of U.S. trade activist organisations, together with their allies from other places in the hemisphere, prepared a bi-lingual series of workshops, cultural events and a large demonstration against the FTAA outside the perimeter of the official talks. Common Frontiers and the Canadian Labour Congress sent a delegation of approximately 200 people.
What did the Trade Ministers agree to?
1.Plurilateralism
Faced with the possible complete breakdown of multilateral talks, the U.S. announced a series of bi-lateral negotiations during the week. The U.S. made a deal with Brazil and after one day of meetings, the Trade Ministers agreed to ‘plurilateral’ arrangements where each country “may assume different levels of commitments” within the FTAA. (6) That is to say, countries will be permitted to pick and choose from a menu of rights and obligations. In Spanish, this is referred to as ‘ALCA a la carte.’ In effect, a few broadly agreed upon issues permit a certain amount of access to the U.S. market. The goal is to negotiate market access issues by September 30, 2004. Although widely believed to be a fictitious date, negotiators aim to conclude the agreement on the more contentious issues by January 2005.
Canada, Chile and Mexico, having been disciplined by previous rounds of negotiations, argued that the multilateral framework would be a more fair way to provide for access to the U.S. market. Canada finally agreed to the plurilateral approach, but wants to ensure the second level issues will be considered a ‘single undertaking’ in the upcoming months.
The Hemispheric Social Alliance considers the plurilateral scenario to be potentially more dangerous than the multilateral framework. The H S A is opposed to the content and basic principles guiding the negotiations. Further:
This shift towards bilateralism puts many countries at a greater disadvantage in their direct negotiations with the U.S. In addition, all issues remain on the table. In other words, the danger is that, beyond the issue of market access, supra-constitutional rules will be imposed on all economies. (7)
2. Services
According to Claude Carrière, Canada’s chief negotiator, Canada’s position is that services should appear in the agreement as a “negative list”. (8) This is unlike the approach taken by the GATS and the World Trade Organization. Under the WTO’s “postitive list” approach, no services appear in the agreement unless they are deliberately included. With a “negative list” approach, all services are included unless they are taken out. Because of opposition from Mercosur, Canada anticipates a “positive list” approach will be required if services are to be included in the FTAA. Argentina and Brazil are not prepared to expand on their offer to the GATS, in the FTAA negotiations.
We need to watch to see how the Canadian government deals with this dynamic. By definition, a “negative list” approach would severely restrict present and future public service provision in areas that cannot be predicted. In both cases, the Canadian government’s goal of bringing services under the discipline of the market is an affront to the public sector economy.
3. Consultative Groups on Labour and the Environment
One of the clauses that was taken out of the draft Ministerial declaration is instructive:
[23. Recognising the importance of sustainable development and the observance and promotion of internationally-recognised core labor standards, we direct the co-chairs to convene a consultative group in labor and the environment. This group will discuss and develop options on how to address labor and environment in the FTAA, taking into account related activities under the Summit of the Americas, and report back to the eighteenth meeting of the TNC for its decision on how to proceed.] (9)
This text was under consideration, and then it was rejected by the Brazilians and opposed by Argentina. One interpretation suggests this clause was rejected because any statement on labour and the environment is contrary to any comparative advantage based on low wages.
An alternative interpretation suggests Mercosur countries know the US must have a statement on labour and the environment in the FTAA. Keeping this particular statement out, makes it unlikely the deal will pass in the U.S. Congress. So, if the U.S. wants it back in, it will have to pay a price. (10)
The Miami Ministerial Declaration gives no direction to committees to negotiate the FTAA in light of labour, environmental, or cultural issues. It only asks the Inter-American Conference of Ministers of Labor (IACML) keep the FTAA co-chairs informed of the results of its inquiry into “key aspects of the labor dimensions of economic integration”. (11)
4. Limiting public policy
Venezuela proposed a clause that aimed to insure each State’s capacity to formulate public policy:
[20. Commitments assumed by the countries of the FTAA must be consistent with the principles of the sovereignty of the State and the respective constitutional texts and must not limit State’s capacity to formulate public policy in keeping with national interests and the well being of their peoples./ ] (12) (italics added)
The Ministerial Declaration includes only the first part of this clause. The text in italics was omitted at the request of Canada. (13) According to Claude Carrière, ‘Nobody would sign it if they knew it would make the deal illegal’. (14)
This is a crucial development. It shows both the role of the Canadian state as well as the real danger in the FTAA, through which neo-liberal states agree to use trade and investment treaties to thrash national social policy. These are not the actions of weak states. Indeed the Canadian government accepted a final declaration that insists on the “commitment of countries to integrate trade into their national development plans, such as Poverty Reduction Strategies”. (15)
Conclusion:
At this point, the unity of the trade ministers is extraordinarily fragile. They cut short their meetings in Miami and had very little of substance to report at the end. They gave no significant direction to the FTAA committees and yet they instructed their negotiators to ensure an agreement on market-access is concluded by the end of September 2004.
In the next year, the substance of the FTAA will be hammered out in nine issue areas including: market access; agriculture; services; investment; government procurement; intellectual property; competition policy; subsidies, antidumping and countervailing duties and dispute settlement. (16)
We must know how the government plans to consult with labour and social movements in each of these issue areas. We must know what the Liberal government is preparing to trade away. And we will be watching.
Notes
- Inside U.S. Trade, “U.S. Seeks Mini-Ministerial Before Miami FTAA Meeting to Address Fight Over Scope”, October 30, 2003.
- Ken Traynor, Canadian Environmental Law Association, Common Frontiers Roundtable, Ottawa, Wednesday November 5, 2003.
- Ed Taylor and David Haskel, “U.S., Brazil Harden Positions Over Scope of FTAA, with Allgeier, Lula Standing Firm”, Bureau of National Affairs, Inc. Washington, November 2003
- Claude Carrière, as quoted in “U.S. Seeks Mini-ministerial”; Department of Foreign Affairs and International Trade,” 8th FTAA Ministerial Meeting, Miami, U.S.A. - November 20-21, 2003 Frequently Asked Questions”, Ottawa: November 2003. http://www.dfait-maeci.gc.ca/tna-nac/FTAA/faq-en.asp
- Citizen’s Trade Campaign, “Civil Society Guide and Calendar to the FTAA Ministerial”, November 14, 2003.
- Ministerial Declaration, Free Trade Area of the Americas Eighth Ministerial Meeting, Miami November 20, 2003, 7. Hemispheric Social Alliance, “Civil Society Responds to the Final Declaration of the VIII FTAA Ministerial in Miami, November 20-21, 2003.
- Notes of briefing with Claude Carrière, Chief Negotiator, Canada, Wednesday November 19, 3pm, Miami Florida. From interview with Jean Yves, Council of Canadians, by Teresa Healy, CUPE Research, Thursday November 20, 2003
- Draft Ministerial Declaration, FTAA-TNC/w/240/Rev.4 Institutional Issues, November 19, 2003
- Communication with Ken Traynor, Canadian Environmental Law Association, November 25, 2003.
- Ministerial Declaration, 37.
- Draft Ministerial Declaration, Institutional Issues, November 18, 2003
- Ministerial Declaration, 4.
- Briefing with Claude Carrière.
- Ministerial Declaration, 17.
- The Trade Negotiations Committee (TNC) will meet three times before September 2004. TNC meetings will be held in Puebla, Panama City and Trinidad and Tobago. The next Trade Ministerial meeting will be held in Brazil in early summer 2004. “Ministerial Declaration”, 31, 39.