In the recently concluded World Trade Organization (WTO) ministerial conference in Hong Kong last December, industrialised nations got what they wanted from developing countries, as shown in the services text of the conference declaration. Now, the US is seeking to step up its advantage by actively pursuing bilateral trade negotiations, even at the expense of people’s welfare.
In the United States-Thailand free trade agreement (FTA) being negotiated, for example, if the US had its way, the Thai government would be unable to meet its obligations to “take all possible measures to reduce infant mortality and increase life expectancy,” according to the activist group Free Trade Agreement Watch.The Thailand-based FTA Watch said that the US demanded in the sixth round of talks that Thailand extend protection to a wider range of intellectual property rights (IPR). This included expanded patent protection covering new medical treatments and diagnostic procedures, extension of the life of patented drugs from the 20 years stipulated by the WTO to 25 years (thus delaying the production and distribution of cheaper medicines), and limiting the Thai government’s imports of generic medicines in other foreign markets.
FTA threatens lives…
The impact of these new US demands would be deeply felt by those needing medical care, particularly those suffering from HIV/AIDS. There are 700,000 persons with HIV in Thailand, and 25,000 more people are infected annually. The life-prolonging, state-produced anti-retroviral drugs could be had at USD 30 per month but once the FTA is in effect, the cost of new, second-line drugs produced by US pharmaceuticals would cost anywhere from USD 250 to USD 750.
Medecins Sans Frontieres (MSF) said this is prohibitive and “will limit Thailand’s ability to protect the health of its people.”
US terms also go “against medical practice and ethics…(and a major shift) from the current trend in the medical community,” said Dr. Somsak Lolekha, Medical Council of Thailand president. The current practice is that new treatment procedures published in international medical journals are considered public property. With the expansion in IPR coverage, however, doctors can no longer use these procedures without paying.
“Medicine is about saving lives, not making money,” Dr. Somsak argued. “If we let someone enjoy exclusive rights…it means we are making money on the health of the people.”
…and displaces local farmers
The negative impact of FTAs is also felt in agriculture. When tariffs are slashed and subsidies are cut, farmers are hard hit, particularly in countries where there is no government subsidy at all for domestic producers.
If the FTA with the US pushes through in Thailand, it can have a “devastating effect on the livelihoods of small (farmers),” said FTA Watch. Already, some 500,000 people have been affected by the FTAs that Thailand had signed with China and Australia. Prices of local fruits and vegetables dropped by up to 50% because of increased imports from China, and dairy imports from Australia had caused a steady decrease in the prices of local dairy products. “Our milk…has to compete with imports of powdered milk,” said Cherdchai, a farmer. “Each year, when the imported products come, the price of our milk drops and we are forced to throw it away.”
These free trade stories are the same in developing countries the world over. In the WTO Special Session of the Committee on Agriculture in June 2000, eleven developing countries reported that trade liberalisation had had negative impacts on agriculture, undermining food security, peoples’ health, and the state’s sovereignty.
Mexico, for example, is seeing the gap widen between the promise and reality of FTAs. According to Laura Carlsen of the International Relations Center, since entering the North America Free Trade Agreement ten years ago, poverty and unemployment rates in Mexico have grown. It had also seen “the erosion of the smallholder farmer economy, loss of traditional knowledge of land and biodiversity use in rural communities, food dependency…and greater inequality in income distribution.”
FTA in other sectors
FTAs—through privatisation—also restrict a government’s ability to ensure access to affordable basic services, from electricity and water, to telecommunications and other sectors.
Residents of Kanyamanze in Africa for example, had their water supply disconnected when their water bills were increased by up to 4,185% by a private UK-based company, reports ActionAid, This resulted in a rise in incidence of cholera, diarrhoea, and gastroenteritis when residents resort to drinking water from the local river.
Furthermore, the International Labour Organization (ILO) World Labour Report also shows that “increasing trade liberalisation and the effects of globalisation have resulted in massive job losses and less secure employment.” It asserts that because of “global competitiveness,” small- and medium-sized producers are overwhelmed by duty-free imports or by transnational rivals setting up their businesses in the locality.
And the winner is—
Clearly, most developing nations are at a disadvantage when it comes to negotiations for FTAs. According to IBON, an independent Philippine-based research think-tank, an FTA with the US would clearly not be based on the ‘level playing field’ necessary to benefit both parties.
“One reason for this…is that the United States picks and chooses what access to give (to their markets), while demanding near-total liberalisation for entry of its own products. (It) routinely maintains protections in the form of quotas and non-tariff barriers that it rarely allows for its trade partners,” Carlsen explains at the Asian Regional Workshop on Bilateral Free Trade Agreements in August 2005.
The US has even started a long-term campaign to monopolise control of global energy services through Iraq. A report by Bangkok-based Focus on the Global South says that the US has recently fast-tracked Iraq’s entry into the WTO, which means opening up energy services to privatisation. Once Iraq becomes a member, it is only a matter of time before US corporations can begin to control oil production and distribution.
Elements demanded by US in FTA negotiations
Source: Third World Network. September 2005. “The Great Maze: Regional & Bilateral FTAs in Asia,” a discussion paper by the Asia-Pacific Trade Investment Initiative, UNDP Regional Centre in Colombo, Downloaded from Third World Network website, <www.twnside.org.sg/title2/FTAs/ General/TheGreatMazeUNDPDiscussionPaper.pdf>. |
Call for slower pace
Civil society groups worldwide call for increased participation in the free trade agreement talks, and demand that these be transparent and go through the process of consultations. FTAs should not be rushed and shrouded in secrecy, as in Thailand’s case. A call for a “slower pace in trade negotiations” has also been conveyed, emphasising the need for comprehensive studies on FTAs’ impact on the social, environmental, and cultural lives of participating nations.
Sources:
ActionAid International. January 24, 2006. “Under the Influence.” Downloaded from ActionAid International, <http://www.actionaid.org/wps/content/documents/174_1_under_the_influence_PREVIEW.pdf>.
Africa, Sonny and Yu, Joseph. September 18, 2005. “RP-US FTA: A Skewed Deal in the Making.” Downloaded from IBON Features, <http://bilaterals.org/article.php3?id_article=2719>.
AFX News Limited. January 9, 2006. “Thousands Stage Protest Rally in Thailand as Free Trade Talks with US Resume.” Downloaded from AFX News Limited website, <http://www.focusweb.org/content/view/805/36>.
“Agriculture.” Downloaded from <http://bilaterals.org/rubrique.php3?id_rubrique=32>.
Carlsen, Laura. “Mexico after 10 Years of NAFTA: The Price of Going to Market,” Downloaded from <http://www.twnside.org.sg/title2/ resurgence/182-183/Cover06.doc>.
“Farmers Break Up Hearing on US-South Korea FTA.” February 2, 2006. Downloaded from <http://bilaterals.org/article.php3?id_article=3712>.
“IPR.” Downloaded from <http://bilaterals.org/rubrique.php3?id_rubrique=33>.
“Labour.” Downloaded from <http://bilaterals.org/rubrique.php3?id_rubrique=38>.
Macan-Markar, Marwaan. January 31, 2006. “Thailand: Free Trade with US Will Hurt Health Care” Downloaded from Inter Press Service News Agency, <http://www.ipsnews.org/news.asp?idnews=31978>.
Malig, Mary Lou. February 3, 2006. “Accession through the backdoor: How the US is pushing Iraq into the WTO.” Downloaded from Focus on the Global South website, <http://focusweb.org/content/view/819/30/>.
Mekey, Emad. January 21, 2006. “Oman Pact Boosts US Agenda in the Middle East,”
Downloaded from Inter Press Service News Agency, <http://www.ipsnews.net/news.asp?idnews=31854>.
_____. February 2, 2006. “US Seeks Wide-Ranging Deal with South Korea,” Downloaded from Inter Press Service News Agency, <http://www.ipsnews.org/news.asp?idnews=31978>.
Moxham, Ben. November 17, 2004. “Milking Thailand: The Thai-Australia Free Trade Agreement.” Downloaded from Focus on the Global South website, <http://www.focusweb.org/main/html/Article537.html>.
“Thailand, US Argue” in Bangkok Post.” January, 13, 2006. Downloaded from <http://bilaterals.org/article.php3?id_article=3537>.
Third World Network. September 2005. “The Great Maze: Regional & Bilateral FTAs in Asia,” a discussion paper by the Asia-Pacific Trade Investment Initiative, UNDP Regional Centre in Colombo, Downloaded from Third World Network, <www.twnside.org.sg/title2/FTAs/ General/TheGreatMazeUNDPDiscussionPaper.pdf>.
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