The UN Development Program reports that the richest 20 percent of the world’s population consume 86 percent of the world’s resources while the poorest 80 percent consume just 14 percent.
The WTO began life on 1 January 1995, but its trading system is half a century older.
Since 1948, the General Agreement on Tariffs and Trade (GATT) had provided the rules for the system. (The second WTO ministerial meeting, held in Geneva in May 1998, included a celebration of the 50th anniversary of the system.)
The last and largest GATT round, was the Uruguay Round which lasted from 1986 to 1994 and led to the WTO’s creation.
Whereas GATT had mainly dealt with trade in goods, the WTO and its agreements now cover trade in services, and in traded inventions, creations and designs (intellectual property).
The World Trade Organization (WTO) is an international organization of 161 members that deals with the rules of trade between nations. With Russia’s accession in August 2012, the WTO encompasses all major trading economies.
The work of the IMF and the WTO is complementary.
The WTO Agreements require that it consult the IMF when it deals with issues concerning monetary reserves, balance of payments, and foreign exchange arrangement.
The policies of the WTO impact all aspects of society and the planet, but it is not a democratic, transparent institution.
The WTO rules are written by and for corporations with inside access to the negotiations. The WTO would like you to believe that creating a world of “free trade” will promote global understanding and peace. On the contrary, the domination of international trade by rich countries for the benefit of their individual interests fuels anger and resentment that make us less safe.
WTO rules put the “rights” of corporations to profit over human and labor rights.
It is time that trade was put firmly in its place, so that it is viewed not as a goal in itself but as a means to achieving broader social, environmental and development goals.
At the very least, the world’s richest countries must honour their commitment to tackling their own damaging practices, particularly subsidies that drive down prices and increase poverty for farmers across the world.
Multilateral trade negotiations need fundamental reform, to be based on fair negotiations, not power play, so that developing countries have an equal place at the table. Genuine consultation with civil society in both the global north and south would no doubt produce other proposals for improvement.
If agreement can’t be reached on a small package of measures to help developing countries, as part of development agenda, then the relevance of the WTO and the multilateral trading system must be questioned.
The sad reality is that very often it is not in a business’s financial interests to act ethically. And no amount of persuasion will change that.The point, then, is not so much to persuade businesses that it is in their interests to act ethically and sustainably – they will work that out for themselves – but to make sure that it is.
Which means two things in practice: raising the benefits of acting ethically and sustainably, and raising the costs of not doing so. There are two principal ways, in a democratic capitalist society, of ensuring that the right incentives are in place for a business to act ethically: via the consumer and via the regulator (indirectly influenced by the citizen).
When humans get into big organisations it can be hard to apply moral values, and the incentives of the business context tend to hold sway. Especially when the boardroom is often far from a particular initiative that may be many thousands of miles away.
The big problem is the lack of global level regulation to match our now thoroughly globalised financial system. Such an international regulatory system is very far from being a reality, but if it is needed to guide, enable and sometimes restrict the activities of the financial sector, it is equally needed in other international sectors, from the extractive industries to manufacturing to agricultural trade.
Attempts at getting companies to sign up to voluntary measures (such as the UN Global Compact) are fine, but they are regarded as quaint by the majority of business people.
For every CEO who has a damascene conversion and transforms or builds their business along ethical lines (think Anita Roddick of the Body Shop) there are thousands who don’t. Lip service is paid, the odd children’s playground is built, the business of business goes on.
The point is to change incentives, and voluntary measures don’t do that. Only legal sanction or consumer action is strong enough, and consumer action is too erratic to rely upon.
In a globalised world, national level laws are clearly inadequate. People say international law is impossible, but they say that about everything worth doing. It is not only possible, it is vital, and is the major project of the 21st century. Without it, the global public cannot expect a private sector that works for people, not just for profit.
If you wanted clear evidence of the above just look at the Two trade Agreements recently negotiated The TTIP and TTP.