Trade beset by double standards

By TERRI-ANN SCORER*

The debate on international trade is polarised. On one side are the globaphiles promoting the pure free trade agenda and on the other are the globaphobes leading the anti-globalisation movement.

The anti-globalisation movement deserves credit for forcing the failures of the current globalisation model on to the political agenda but the debate is not confronting the real changes transforming the global trading system.

Oxfam has published a report which aims to demystify the issues around international trade, acknowledging the potential benefits and quantifying the costs in development terms.

The analysis shows the present trading system has many rigged rules and double standards which prevent developing countries from participating in international trade to the full.

Oxfam does not believe that trade is a panacea for global poverty, but it recognises that increased trade coupled with sound national policies for income distribution can help achieve poverty reduction.

Oxfam has also started a global campaign, Make Trade Fair.

Oxfam rates New Zealand one of the fairest trading partners for developing countries but believes it could do better.

The Government should promote initiatives for special and differential treatment for developing countries in the global trading system, and encourage multinationals in this country to behave ethically.

The timetable for liberalisation is one example where developing countries require special treatment.

As a governing member of the World Bank and International Monetary Fund, New Zealand is complicit in the forced liberalisation of the markets of developing countries.

This change has had a devastating impact on the rural poor, especially when subsidised produce is dumped into their markets.

For example, in 1995 Haiti slashed its import tax on rice from 35 per cent to three per cent, largely on the advice of the IMF and the US. As a result, highly subsidised American rice now floods the market and and more than 93,000 families who depend on rice growing are in peril. Many face destitution and the prospect of being forced off the land.

Developing countries are those unable to provide a social safety net to citizens whose livelihoods may be destroyed by trade liberalisation or the investment required for rapid technology transfer or the creation of employment in other industries.

New Zealand can do more to influence the policies of the international bodies who are pressing for a liberalisation time frame that only undermines poverty reduction.

A double standard exists when developing countries are forced to liberalise their markets while rich OECD nations continue high levels of protectionism.



Oxfam wants the Government to provide comprehensive market access to the 70 Low Income Countries (where average GDP per head is less than $1690).

OECD producer subsidies and export subsidies, which create unfair price competition, must be abolished.

The Government can also do more to promote the OECD Guidelines on Multinational Enterprise, which include core labour standards and objectives for social development and environmental protection.

Oxfam is concerned that few mechanisms exist to press for a philosophy of ethical investment in the international arena.

Its report shows many examples of workers in poor countries being denied basic labour rights and a living wage.

Other OECD nations have taken steps to promote these guidelines but in New Zealand this is yet to happen.

Oxfam wants the Government to give higher priority and more resources to promoting ethical investment principles to multinational enterprise, and to enshrine these principles in any free trade agreement.

New Zealand has an opportunity, and a responsibility, to shape the globalisation process into one which promotes prosperity for all the world's citizens. Increased aid flows are important, but current international trade practices cannot be tolerated.

* Terri-Ann Scorer is the executive director of Oxfam New Zealand.

* The report, Rigged Rules and Double Standards: Trade, Globalisation and the Fight Against Poverty, is available at Make Trade Fair.