I would like to
begin my comments with a plea made by the Deputy Prime Minister and Finance
Minister of Samoa - one of three small islands in the South Pacific that are
undergoing the torturous process of WTO accession: [1]
We, the small states of the
pacific, and the world, feel as though we are the mice who catch pneumonia when
the elephants sneeze. We would ask the big powers to tread softly, for you
tread not only on our lives, but also on our livelihoods.[2]
Similar and
persistent appeals for sensitivity in WTO accessions have fallen on deaf ears.[3]
The problem, according to a senior Samoan negotiator, is that the supposedly
‘rules based organization’ has no rules. Others who have an intimate knowledge
of Vanuatu’s stalled accession put it more sharply: ‘the accession process has
no rules, except precedent and power, and is the very antithesis of what the
members publicly state to be the intention and design of the WTO’.[4]
The General Council Decision of 10 December 2002, which pledged sensitivity to
development needs and self-restraint towards least developed countries (LDCs),[5]
has not made the slightest difference. Nothing mocks the claim to a Doha
‘development’ agenda,[6]
and delegitimates the WTO even further, than the power politics of accession.
While all eyes
are fixed on the fate of the Doha Round, it is important to recognize that most
of what the South is rejecting has already been forced, arrogantly and
invisibly, onto some of the world’s smallest, poorest and most vulnerable
countries.
Vanuatu is a
group of 83 islands with 200,000 people. Samoa has a population of 177,000 and
Tonga 100,000. Vanuatu and Samoa are LDCs.
No one denies that these countries face enormous challenges. They are
typical of small, geographically isolated and environmentally vulnerable island
states.[7]
The majority of their people are subsistence farmers.[8]
Tariffs provide between one fifth and almost half of government revenue.[9]
They run chronic and growing trade deficits.[10]
They export a small number of commodities,[11]
assisted by preferential access to Australia and New Zealand under SPARTECA and
the EU under Cotonou that is now eroding. The main services ‘trade’ is tourism,
and for Vanuatu offshore banking.[12]
In recent years imports of cheap, low quality foods has undermined local
self-sufficiency. Population growth rates are high. HIV/AIDs infection is
growing, as are lifestyle diseases such as diabetes and heart disease.
Inequality has become more noticeable, especially between rural and urban
communities. Families depend heavily on remittances.[13]
Their political situation is relatively stable in a quite unstable region, but
each has had its controversies. Like other members of the Pacific Islands Forum
they depend heavily on the patronage of Australia and New Zealand who
aggressively protect their ‘patch’.[14]
As the Australian newspaper put it: ‘Australia is often said to be the superpower
of the South Pacific. If so, then New Zealand is certainly the second, with
Wellington playing London to Canberra’s Washington.’[15]
Vanuatu completed
its accession in 2001, after six tortuous years - only to put it on hold,
citing ‘technical reasons’, days before the Doha ministerial. Stepping back
from the pressure, the Treasury and politicians believed they had given away
too much.[16] Recently,
Vanuatu has begun to reactivate the process,[17]
but wants to reopen the bilateral phase, especially on the far-reaching
services offer on wholesale and retail trade, health, environmental,
audiovisual, legal, professional and technical services it was bullied by the
US into making.[18] They also
want guaranteed rights to the TRIPS health waiver. There does not seem to be
any legal basis for revisiting an accession package that has been signed off
on, which leaves Vanuatu to the mercy of the General Council.[19]
Tonga began its
process in 1996 and has bilaterals with the US and EU yet to do. Samoa applied
for accession in 1998 and is, to quote, ‘taking its time’. Like all acceding
countries,[20] they have
faced outrageous demands for WTO-plus commitments from the self-nominated
members of their Working Parties.[21]
Samoa’s senior trade consultant objects that the right of veto means there are
no negotiations: ‘They can ask for all sort of commitments which Samoa isn’t in
a position to offer. If they insist, there are 2 options: we will never become
a member or we have to give in to that request.’[22]
The Islands, like
Cambodia and Nepal before them, are pawns in a global chess game that has nothing
to do with their needs or the harm that would result if they gave in.[23]
It is about creating precedents that provide leverage in multilateral
negotiations or important accessions. Each favourable new precedent sets a
progressively higher benchmark. The most pressing demandeurs have been
Australia, New Zealand and the EU – plus the US, even though it barely trade
with the Islands. The US has focused on tariff bindings, GATS, TRIPS, TRIMs and
procurement,[24] while the
Cairns Group members New Zealand and Australia target tariff bindings, export
subsidies, domestic support and special safeguards measures for agriculture.[25]
The Europeans have reportedly made fewer demands on the Pacific, but their turn
will come when negotiations for a Pacific REPA under Cotonou begin later this
year.[26]
Because the
process is shrouded in secrecy, critics and analysts – let alone
parliamentarians and citizens – have no idea of what is at stake. Fortunately, the Vanuatu case is now
well-documented; [27] similar
secrecy will be different next time around, especially as is may become an
election issue later in the year.[28]
Some information is slowly emerging on Tonga and Samoa; NGOs and the media are
asking questions, especially in Samoa.[29]
But there are no proper social impact studies and no open public debate about
the kind of development they are being locked into. Let me give a couple of
examples.
Both Tongan and
Samoan officials concede that WTO accession offers no real commercial gains.[30]
Samoa currently exports all that it can and has access to ‘Everything But
Arms’, so long as that lasts. Tonga’s main export barriers are small scale,
limited land, access to finance, natural calamities and climatic conditions,
falling commodity prices, low priced international competition, remoteness,
high transport costs, insufficient expertise and advise on diversification, and
onerous standards and SPS requirements from richer countries.[31]
None of these will be addressed through accession and may become worse.
New Zealand
supplies around one third of Tonga’s imports. About one third of that is
foodstuffs. Last month, New Zealand’s Trade Minister hailed the completion of
Tonga’s bilateral negotiations as ‘saving’ New Zealand exporters $6 million in
tariffs.[32] Put another
way, Tonga, which currently draws over 40% of government revenue from border
duties, will need to make up a $6 million fall in revenue. The options are user
charges, broader sales tax or a consumption tax[33]
- in a country where 80% of the people are subsistence farmers whose cash
income is largely from remittances.[34]
Similar demands
are being made of Samoa. Why? The Islands don’t produce competing products
domestically; Tongans and Samoans would buy the products, with or without
tariffs. Trade theory reassures us that price savings will compensate. But
delicensing of Australian rice imports into Vanuatu made not different to the
monopoly there, because that’s how the Australian exporter likes it. Prices
haven’t dropped either.[35]
Indeed, there are
sound development reasons for hoping that the prices won’t fall. Around one
third of New Zealand’s meat exports into the Pacific are a fatty waste product
known as ‘mutton flaps’. A 2001 World Health Organization report drew explicit
links between dependence on imported foods, especially mutton flaps,
diet-related disease and trade liberalization.[36]
It found that, despite effective education and awareness programmes, people
were making economically rational, but nutritionally detrimental, decisions to
eat less healthy foods because they were cheap and available. That year Fiji, a
WTO Member, announced a ban on mutton flaps, citing proven links to obesity;
New Zealand threatened action at the WTO.[37]
Tonga then urged the New Zealand government to end mutton flap exports and
encourage a return to healthier traditional diets, such as fish, organic
chicken[38]
and taro that simply can’t compete in Tonga’s small domestic market. One New
Zealand MP replied that Tongan businesses had the right to decide what to
import.[39]
At the same time, one of NZAID’s priorities is to fund health programmes in
Tonga.
The direct
socio-economic impacts are more obvious. US demands that Vanuatu immediately
reduce its tariffs to 15-25 per cent would, to quote officials,
‘have thrown
Vanuatu’s tiny private sector into competition with globally competitive
neighbouring economies and probably would have made many businesses bankrupt’.
.. [I]n Vanuatu the closure of even one
major company would constitute a major blow to employment and aggregate
economic growth. WTO entry could be expected to raise unemployment over the
short term in manufacturing, construction, retail and wholesale, hotels and
restaurants, and finance and insurance. Together these sectors comprise 47 per
cent of employment.’ [40]
In agriculture: ‘It is likely that the swift abolition of
price supports to the majority of farmers who live in outlying islands would
have left them without any income.’
Other issues,
such as the affordability of medicines for life threatening disease, ecological
sustainability through local processing of timber or fish,[41]
survival of small local shops faced with growing numbers of Asian wholesalers,
and retention of land in customary ownership – which is a Constitutional
guarantee in Vanuatu[42]
– have the potential to make or break governments, as well as decide the future
of their societies.[43]
The price of
accession is intolerable in another way. Tonga says it gravely under-estimated
what was involved. [44] There are
simply not the people to do all the work, however far they stretch themselves.
Vanuatu estimates the process cost it US$150,000. It cost US$20,000 a year cost
for observer status – which is the entire budget of the Department of Trade. By
the end, Vanuatu owed the WTO US$170,000 in unpaid fees. [45]
The government’s total annual expenditure is just US$60 million. Once a member
there are the costs of participation[46]
and the burden of implementation (notably standards and quarantine) with
threats of enforcement if they ‘fail’.[47]
That is just for
the WTO. At the same time the Islands will have to manage negotiations with the
EU for a Pacific REPA before the end of the year that are more extensive than
the WTO, including the Singapore issues. Plus, Australia and New Zealand insist
that once the REPA negotiations begin, the Islands must enter into parallel
negotiations under PACER. Australian Prime Minister Howard has signaled the end
game - a full ‘EU-style’ Pacific Economic Community, including a common
currency and pooled governance and security arrangements, which of course
Australia would lead.[48]
It is time to
challenge those countries whose abusive practices are protected by the shroud
of secrecy. New Zealand and Australia proclaim a special relationship with the
South Pacific. But, as one New Zealand government representative frankly admitted
to me: “When it comes to trade, there is no special relationship to the
Pacific. They [the negotiators] do a group hug, then put their Geneva hats on.”[49]
Australia and New Zealand reportedly threatened to cut off technical assistance
to Vanuatu’s agricultural sector, which help fund its diversification programme
unless it abandoned rights to use price supports, special safeguard measures
and export subsidies, [50] and claimed
that ‘Uruguay Round methodologies are not available to acceding countries. The
lead came from the top. Former Director General Mike Moore proclaimed in a
video-link to the first Trade Policy Course for Pacific Island countries run by
the WTO and Forum Secretariat in March 2001,
‘It is my duty as
Director-General to ensure you receive all the necessary and possible technical
support to accelerate your applications. I will also work to ensure that undue
pressure beyond the established rules is not placed on acceding countries’.[51]
Yet, one account
says Moore’s Secretariat[52]
warned Vanuatu that its accession would be denied unless it gave into US
demands and took strong commitments on wholesale and retail trade, after which
the negotiators changed course.[53]
There is no
tolerance for contestable advice. In October 2003, The Guardian revealed a
letter in which a senior British trade official and a London-based New Zealand
diplomat discussed plans to monitor a Commonwealth Secretariat official at the
Cancun ministerial and the need to ensure his contract was not renewed.[54]
The official, Roman Grynberg, had given critical advice to Southern governments
about the Doha Round and written numerous papers on the risks that such
negotiations posed for the Pacific Islands.[55]
He had been intimately involved in Vanuatu’s accession and was blamed for the
Islands reluctance to include Australia and NZ in a regional trade agreement. A
colleague working in Geneva was also reportedly targeted for giving ‘unhelpful’
advice to the LDCs.
The ‘Dracula principle’ of bringing
daylight to bear on such behaviour can only achieve so much. In a recent report
prepared a report for Pacific NGOs entitled Big Brothers Behaving Badly, [56]
I exposed the tactics of Australia, often backed by New Zealand, which led to
the PACER agreement. These included the familiar ploy of bypassing the more
informed negotiators to pressure the politicians in the capitals. Small teams
of officials were deluged with technical proposals they had no capacity to
process. The Pacific response to the aggressive style of Australia and New
Zealand was silence, which was interpreted as consensus. There was also full
frontal bullying – shouting at, berating and intimidating officials,
negotiators and consultants. One New Zealand consultant said:
The
public behaviour of the Australian officials at some of the meetings was
appalling. … Their private behaviour, at its worst, descended to levels that I
regard as totally unacceptable The whole experience was stressful and
demoralizing for me, let alone for the Pacific Islands negotiators. There were times that I felt ashamed to be a
New Zealander; I was just pleased that I was not an Australian.[57]
Trade Minister
Jim Sutton’s countered that Australia and New Zealand had behaved ‘impeccably’,
then let forth a stream of personal abuse that proved the point.[58]
Similar attitudes
flow through the accessions, although apparently New Zealand’s behaviour has
improved since the PACER report was released. But that doesn’t alter the
substance. To quote the Samoan’s adviser:
“The
unfortunate thing about the United States is they are very arrogant and treat
every country the same. … One would expect that Australia and NZ will
understand about us more …. If New Zealand should insist that our binding rate
should be zero … what happens then is Samoa or the Government will have to
decide whether the price of joining WTO is too high – it is as simple as that.
Eventually it will be up to the Government to make that decision. If we
negotiate, we have a mandate but if what the country is asking of us is outside
of the mandate and we cannot negotiate, then it’s time off. … We are going
there with our eyes open. That is why we are not rushing into things.”[59]
In other words,
the power politics may backfire. The Pacific Islands have nothing to gain and
everything to lose from joining a club that has the potential to devastate
their economies, cultures and societies, and create enormous instability and
turmoil in an already unstable region. Once they enter the WTO, they will be
trapped within an economic paradigm of global markets that is being pushed onto
the Pacific by the World Bank,[60]
Asian Development Bank (ADB)[61]
and IMF,[62] and that is
profoundly anti-development and anti-democratic. Those who advocate this model
on behalf of the institutions see this as the real benefit of WTO accession. By “locking in” such reforms
internationally, WTO accession provides governments with a defence mechanism
against future policy backsliding or “de-liberalization” in response to
domestic protectionist pressures’.[63]
‘Sensible’ governments would realize the need for reforms; ‘super-sensible’
governments would implement reforms that exceed WTO requirements.
Grynberg, by
contrast, questions the inappropriateness of these policies for the Islands and
doubts they are stable or strong enough to weather the severe political and
economic consequences of the very long and difficult transitions that these
policies would require. [64] Others of us are convinced that there is
already enough evidence that this paradigm has failed the people of the
Pacific.[65] It is not a
question of whether these Islands can afford to say ‘no’ to the WTO. They
cannot afford not to.
REFERENCES
Adhikari,
R. and N. Dahal, (undated) ‘LDCs’ Accession to the WTO: Learning from the Cases
of Nepal, Cambodia and Vanuatu’, South Asia Watch on Trade, Economics &
Environment (SAWTEE), Kathmandu, Nepal
ADB
(2004), ‘Discussion Paper. ADB Pacific Strategy 2005-9: Responding to the
Priorities of the Poor’, Manila: ADB
AID/WATCH
(2004) Press release: ‘Downer puts ‘Governance’ before sustenance in aid
budget’, 11 May 2004
AUSAID
(2003) AUSAID Seminar on Trade and Devvelopment, Sydney 17 November 2003
Bosworth, M and
R. Duncan (undated) ‘Current Status of the WTO Accession Process and the
Experience of ESCAP Acceding Countries’, ESCAP
Charveriat,
C. and M. Kirkbride (2003) Cambodia’s Accession to the WTO. How the law of the
jungle is applied to one of the world’s poorest countries’, OXFAM International
http://www.cancun2003.org/en/web/216.html;
Choudry,
A. (2002) ‘Killing me Softly’, ZNet Commentary 3 August 2002 http://www.zmag.org/sustainers/content/2002-08/03Choudry.cfm
CNN
(2001) ‘Pulled out of WTO accession process’, 13 November 2001,
CNN.com/2001/BUSINESS/asia/11/13/Vanuatu.sope.biz
DFAT
(2000) Australian Government Department of Foreign Affairs and Trade, ‘The
Government’s Key Market Access Wins for Agri-Food (Mid 1996 – 25 February
2000)’, www.dfat.gov.au/ma/pf/mawins4.html
DFAT
(undated), Australian Government Department of Foreign Affairs and Trade , ‘WTO
accessions and how Australia stands to benefit’, www.dfat.gov.au/trade/negotiations/accession/;
Evans,
M et al. (2001) ‘Globalization, diet
and health: an example from Tonga’, 79(9) Bulletin
of the World Health Organization 856
FAO
(undated) ‘Adjusting the changes in the global trading environment’, in FAO and SIDS: Challenges and emerging issues
in agriculture, forestry and fisheries,
www.fao.org/DOCREP/006/Y5203E/y5203e01.htm
Finger,
M. and Schuler (2000) ‘Implementing the WTO Round Commitments: The Development
Challenge’, The World Economy, 511
Gay,
D. and R. M. Joy, (undated) ‘Vanuatu’, ESCAP
Government
of Fiji (2001), ‘Health of Fijians more important than NZ threats’, Government
Press Release, Suva, 15 March 2001
www.fiji.gov.fj/press/2001_03/2001_03_15-01.shtml
Government
of Samoa (2003) ‘Country Programme outline for Samoa’ (2003-2007), Apia
Government
of Tonga, (2001) ‘Report from Tonga’s First Working Party on its Accession to
the World Trade Organization that was held in Geneva, Switzerland from 23 to 27
April 2001’, www.pmo.gov.to/aud1grp.html
Government
of Vanuatu (2004) ‘WTO After Cancun’ – the perspective of Vanuatu’, powerpoint
presentation
Grynberg, R.
(undated) ‘The Pacific Island States and the WTO: Towards a post-Seattle Agenda
for the Small Vulnerable States’, Forum Secretariat: Suva.
Grynberg,
R. and R.M. Joy, (2000) ‘The Accession of Vanuatu to the WTO: Lessons for the
Multilateral Trading System”, 34(6) Journal
of World Trade p.159
Grynberg,
R, V. Ognivtsev and M. Razzaque (2002)
Paying the Price for Joining the WTO. A
Comparative Assessment of Services Sector Commitments by WTO Members and
Acceding Countries, Commonwealth Secretariat: London, p.41
Hayashi,
M. (2003) ‘Arrested Development:
Vanuatu’s Suspended Accession to the World Trade Organization’, Case Study
prepared for the International Commercial Diplomacy Project: Geneva;
IMF,
(2002) ‘The IMF report on the 2002 Article IV Consultation with Vanuatu did
urge a ‘reinvigorated effort at WTO accession’,
www.imf.org/external/np/sec/pn/2002/pn02134.htm
ITC,
(2004) ‘Tonga: National Export Strategy: Scope, Focus and Process’, January
2004
Kelsey,
J. (2004) Big Brothers Behaving Badly, Suva:PANG
www.pang.org.fj
Lewis,
P. (2002) ‘Negotiating with Unequal partners: Small States in the New Global
Economy”, Foundation for Development Cooperation Symposium, University of
Queensland, South Pacific Futures, July 2002 (draft paper)
Moore,
M. (2001) ‘WTO/FORSEC Trade Policy Course for Pacific island Countries, Fiji
5-9 March 2001
O’Fa,
S. (2004) ‘Tonga’s perspective – Post-Cancun’, Trade Policy Unit, Ministry of
Labour, Commerce and Industries, Government of Tonga
Retzlaff,
M.T. (2002) ‘Samoan Leader Discusses
U.S. Role in Foreign Politics’, Georgetown University 2002 www.thehoya.com/news/100102/news4.htm
Sharma. S
(2003) Media Statement, ‘IMF-World Bank-WTO Close Ranks Around Flawed Economic
Policies’, Institute for Agriculture and Trade Policy, 12 May 2003
Slatter,
C. (2003) ‘Will Trade Liberalization Lead to the Eradication or the
Exacerbation of Poverty?’ CID Trade Forum Proceedings: February 2003, Wellington: Council for
International Development
Slatter,
C. (2004) The
Politics of Economic Restructuring in the Pacific with a case study of Fiji, PhD thesis, Massey University, New Zealand
Stoler,
A. L (2003), ‘The Current State of the WTO’, Workshop on the EU, the US and the
WTO, Stanford, March 2003
UNCTAD,
(2003) WTO Commitments by Cambodia, Nepal and Vanuatu – Comparative Table, 18
September 2003/VO/MH/DITC, UNCTAD, p.26
‘Vanuatu’s
Suspended Accession’, (undated) www.commercialdiplomacy.org/case_study/vanuatu2.html,
Annex Table 2
‘Vincent
Chronicle No 14 – Our Social Security’, 31 July 2003, www.news.vu/en/opinion/Chronicles/269.shtml
World
Bank (2002) Embarking on a Global Voyage:
Trade Liberalization and Complementary Reforms in the Pacific, Pacific
Islands Regional Economic Report, World Bank: Washington
* Professor
Jane Kelsey (LLB Hons), BCL(Ox), MPhil(Camb), PhD, of ARENA and the University
of Auckland, New Zealand, paper to WTO Public Symposium ‘Multilateralism at the
Crossroads’ 27 May 2004
[1] Article XII of the Marrakesh Agreement
Establishing the World Trade Organisation states: ‘Any State or separate customs territory possessing full autonomy in the
conduct of its external commercial relations or for the other matters provided
for in this Agreement and the Multilateral Trade Agreement may accede to this
Agreement, on terms to be agreed between it and the WTO’.
[2] Retzlaff (2002)
[3] Dhaka Declaration of the Second LCD Trade
Ministers’ Meeting 2003 (WT/L/521)
[4] Grynberg and Joy, (2000) p.172
[5] Decision of the General Council on
Streamlining Accession of the LDCs, dated 10 December 2002 states: ‘WTO Members shall exercise restraint in
seeking concessions and commitments on trade in goods an d services from acceding
LDCs, taking into account the levels of concessions and commitments undertaken
by existing WTO LDC Members’; and
‘Acceding LDCs shall offer access through reasonable concessions and
commitments on trade in goods and services commensurate with their individual
development, financial and trade needs, in line with Article XXXVI.8 of GATT
1994, Article 15 of the Agreement on Agriculture, and Articles IV and XIX of
the General Agreement on Trade in Services’.
[6] Paragraph 42 of the Doha Declaration
states that: Accession of LDCs remains a
priority for the Membership. We agree to work to facilitate and accelerate
negotiations with acceding LDCs. We instruct the Secretariat to reflect the
priority we attach to LDCs’ accessions in the annual plans for technical assistance.
The draft Ministerial Texts for Cancun said: ‘We continue to attach great importance to concluding accession
proceedings as quickly as possible and, in particular, to accelerating the
accession of least-developed countries. In this regard, we reaffirm the
guidelines to facilitate the accession of LDCs adopted by the General Council
on 10 December 2002’.
[7] see FAO (undated)
[8] The Samoan government reports that village
studies show 78% of families in urban villages have one waged worker, compared
with 37% in other locations: Samoa (2003). Gay and Joy (undated) estimate that
80% of Vanuatu’s population depend on subsistence farming, with the cash
economy centred in two towns
[9] Samoa receives about 20% of revenue from
tariffs, while approx 46% of the Tongan government revenue is from customs
duties and the Port and Services Tax.
[10] Tonga 2002: merchandise exports US$9
million; merchandise imports US$70 million; Samoa 2002 exports ST$46,284;
imports ST$454,227
[11] Vanuatu depends largely on copra, cocoa,
cattle, forestry, with fishing, offshore financial services and tourism; Tonga
on agriculture (squash, vanilla), tuna fishing, tourism; Samoa on fish, beer,
taro and garments.
[12] All three islands have been accused of
‘harmful tax competition’ by the OECD and have taken some regulatory steps in
response.
[13] It is believed that more Samoans and
Tongans now live outside the countries than in them.
[14] Tonga, for example, received $US5.5
million from Australia and $NZ2.3 million from New Zealand in aid. The 2004 Australian
budget has injected A$432 million into the AUSAID budget; A$208 million will be
spent on police and military operations in Solomon Islands and Papua New
guinea, most of which will boomerang back to Australian government agencies.
AIDWATCH (2004)
[15] The
Australian, 25 August 2003
[16] Vanuatu is one of three Pacific Island
countries that has also chosen not to join the regional free trade agreement
among the islands (PICTA) or PACER with Australia and New Zealand, even though
the Parliament has passed the necessary legislation.
[17] Government of Vanuatu (2004). The IMF has
been pressing for this; IMF (2002)
[18] Vanuatu’s extensive services commitments
covered professional services; basic and value-added telecom, environmental,
wholesale, retail, insurance, banking. hotels and restaurants. primary,
secondary, higher, adult and other education, sewage, refuse disposal,
sanitation and similar, general construction for buildings.
[19] Apparently, a letter was circulated by the
General Council on the Vanuatu accession in early May 2004 but it’s content has
not been made public.
[20] Charveriat and Kirkbride, (2003); Adhikari
and Dahal, (undated)
[21] 15 WTO members and observers attended
Tonga’s first Working Party meeting: Australia, New Zealand, Japan, India,
Mexico, European Commission (on behalf of the 16 Members of the EU, US, Canada,
Hong Kong China, and Observers: Chinese Taipei, WIPO, UNCTAD, World Bank and
IMF. Government of Tonga (2001)
[22] Interview with Tuala Falani Chan Tung, Sunline, April 2004
[23] Recently, for example, the New Zealand
Trade Minister has confirmed that export interests are the sole consideration
in its requests for education services.
Written parliamentary question 06455(2004) 25 May 2004
[24]Vanuatu’s Suspended Accession (undated) ;
Charveriat and Mary (2003)
[25] DFAT (undated) is reasonably coy about the
position, but makes no reference to the position of LDCs; actual achievements
are described in DFAT (2000)
[26] For similar issues in relation to the
Caribbean, see Lewis (2002)
[27] Hayashi (2003); Grynberg and Joy (2000);
D. Gay and R. M. Joy (undated) ‘Vanuatu’, UNESCAP: Bangkok; UNCTAD (2003)
[28] This is a politicised issue. In June 2003 Opposition leader Willy Jimmy expressed doubts that resurrecting the accession was in the national interest.
[29].O’Fa(2004); Interview with Tuala Falani
Chan Tung, Sunline, April 2004
[30] O’Fa (2004): he suggests that any
potential benefits will depend on the policy reforms that accession puts in
train.
[31] O’FA (2004); Interview with Tuala Falani
Chan Tung, Sunline, April 2004
[32] Hon Jim Sutton, ‘NZ signs WTO accession
agreement with Tonga’, 8 March 2004
[33] Tonga has introduced a tax reform bill but
it will be difficult to implement.
[34] ITC (2004)
[35] Grynberg and Joy (2000) fn 9
[36] Evans (2001)
[37] Government of Fiji (2001)
[38] A ban on imported, often low quality,
chicken to promote an infant industry of organic chicken became a politically
charged issue and seems not to have been enforced. ‘Ban on imported chickens
never respected’, 19 September 2003, www.news.vu/en/news/national/667.shtml
[39] Choudry (2002)
[40] Gay and Joy (undated), p. 299, 296
[41] Grynberg reports that the WTO objected to
measures by PNG and Solomon Islands to move away from exports of unprocessed
raw materials as an undesirable departure from comparative advantage, leaving
them to export unprocessed forest and marine products while other countries
processed them. He observes ‘It is
difficult to imagine a policy prescription that is more odious to Pacific
island policy makers’. R Grynberg (undated)
[42] Vanuatu’s post-Independence Constitution
says “All land in the Republic belongs to the indigenous custom owners and
their descendents’. Investors have 75 year leases and this seems to cause few
real problems.
[43] Commentator Vincent Boulekone explains
that customary land tenure is also seen as the main source of social security
protection, including ‘pensions’. ‘Our
people will be welcomed by their ancestral villages where custom and solidarity
remain strong, at least outside the urban zones. But the question is: what is
going to happen if, as recommended by the WTO and other international
organizations, all the community lands have been registered for the profit of a
few individuals in each clan and tribe? The ‘unproductive persons’ will have no
option, after many years of work, but to remain in urban zones, and we all know
what this would mean regarding social and ethnic conflicts. Just as in Africa,
or in the Solomon Islands, the deterioration of life, even the possibility of
wars, will inevitably cause civil unrest following the take-over of power by a
dominant population from other
islands.’
[44] According to Tonga’s Trade Policy Unit: ‘As is to be expected, Tonga has found the
accession process to be cumbersome and tedious with human and institutional
constraints prolonging the exercise. The true extent of the work involved was
however not appreciated by Tonga at the beginning of the process. The extensive
workload has been compounded by the fact that reform required for WTO accession
has coincided with whole scale governmental reform.’ O’Fa(2004) Ahikari and
Dahal report that Nepal was required to answer some 365 questions, 24 on
economy, economic policies and foreign trade, 178 on the framework for making
and enforcing policies affecting foreign trade in goods and services, 114 on
trade-related intellectual property rights regime and 48 on trade-related
services regime. Adhikari and Dahal, (undated) p.3
[45]World Bank economists have estimated that
implementation of quarantine, standards and customs systems can cost the whole
years’ development budget of a least developed country. M Finger and
Schuler,(2000). They warn that poor implementation may result when governments
do not feel a sense of ownership and ‘attempts
to force implementation through the WTO settlement mechanism would likely
reinforce the impression that the WTO rules are imperially imposed from the
outside, for the benefit of the outside’, p.513
[46] One former US official observed ‘I think
it is crazy to force a country like Vanuatu to spend years negotiating accession
to the WTO when we already know that at the end of the day, Vanuatu won’t be
represented in WTO meetings in Geneva.’ His solution was to formalize the
imbalance of power by a two-tier WTO.
Stoler (2003)
[47]One AUSAID paper puts the figure for
implementing WTO related reforms at US$400 million, but that sounds excessive.
(AUSAID, 2003) Australia and New Zealand are obliged under PACER to fund a
Regional Trade Facilitation Programme but signing of the Memorandum of
Understanding has been deferred twice now because of major disagreements over
the amount they will provide. In July 2003, Australia announced A$500,000 ‘to
assist small nations, including Pacific Island states to develop sufficient
institutional capacity to further their trade interests at the WTO’. Australia
had already provided initial funding of A$176 million in 2002 for the Agency
for International Trade Information and Cooperation (AITIC), As Shefali Sharma observed in 2003 ‘No amount of technical assistance in
implementing policies that, in effect, handicap and shackle developing
countries in the WTO can improve gains towards development’.
[48] That goal has recently been endorsed by
the ADB (2004.
[49] Kelsey,(2004), p.30
[50] The right to use Special Safeguard
Measures under Art 5 of the Agreement on Agriculture (AoA) must be reserved at
the time of accession. Art 15 of th e AoA exempts LDCs from commitments to
reduce price support.
[51] Moore (2001)
[52] The Secretariat’s mandate to work for
existing WTO Members leads Grynberg et al to suggest it has a conflict of
interest in accessions, Grynberg et al (2002)
[53] Hayashi (2003) One informal source
suggests the Secretariat played an even more direct role. Grynberg and Joy also
note the conflict of interest for a Secretariat that is there to serve its
existing members.
[54] The
Guardian, 12 October 2003
[55] R. Grynberg (undated); Grynberg et al
(2002)
[56] Kelsey (2004)
[57] Kelsey (2004), p.16
[58] ‘Sutton Attacks Kelsey Personally’, 5
April 2004, www.scoop.co.nz
[59]Interview with Tuala Falani Chan Tung, Sunline, April 2004
[60]World Bank (2002)
[61] Outlined most recently in ADB (2004)
[62] In Vanuatu, accession was strongly linked
to the Comprehensive Reform Programme the ADB insisted on in 1998. Gay and Joy (undated) p.287
[63] Bosworth and Duncan (undated), p.10
[64]‘What
is not accepted is that some island states may be so small, isolated and
vulnerable that it is difficult to imagine what combination of internal
adjustment policies would induce substantial domestic or foreign investment.
Many SVEs suffer from very high operating costs stemming not from policy
induced measures but from the inherent nature of small, isolated and physically
dispersed economies’. Grynberg (undated
[65] These are comprehensively documented in
Slatter (2004); see also Slatter (2003)