Wednesday, November 30, 2005

WTO summit, Hong Kong: the free trade myth

For years rich countries have bullied poor ones to open their doors to floods of cheap imports. Now they are using the World Trade Organisation to kick down the door altogether.

In the past most of today's most developed economies have used policies to protect their industries from foreign competition until they were big enough to survive without support. But now they are using the WTO to deny poor countries the same route to economic development.

They hide behind the free trade argument that says if all trade restrictions like import tariffs and quotas were dropped each country would do what it does best and all would prosper.

But this level playing field is a myth. Pitting fledgling industries in poor countries against big business overseas is like putting a rabbit in a cage with a tiger. There can only be one winner.

The fair trade argument puts people at the centre of world trade. It says that trade rules should allow people to work themselves out of poverty by selling their products to rich countries and other developing countries at a decent price. They should also be able to protect their economies until such time as they are established enough to compete with the more developed countries.

In theory, WTO rules should remove trade barriers in rich countries while allowing poor countries to protect their markets until they are strong enough to compete. However, in practice rich countries use their power and influence to rig the rules in their favour – kicking down the doors to developing country markets and driving the poor deeper and deeper into poverty.

What we want

The outcome of the Hong Kong talks will set the rules of world trade for years to come. As they stand the rules benefit the richest countries and drive the world's poorest people deeper and deeper into poverty.

World leaders must not miss this opportunity to make trade fair. At Hong Kong rich countries must:

Kicking down the door to the markets of developing countries before they are ready will destroy their economies. Poor country governments should be allowed to decide on trade policies that will help them end poverty.

Subsidising the overproduction and dumping of farm produce on poor countries is destroying the livelihoods of millions of poor farmers.

This round of talks was intended allow poor countries to capture their share of world trade - but for every concession the rich countries are demanding something in return. This is not only dangerous and unreasonable but it goes against the original spirit of the talks.

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