Is the US trade agenda coming apart at the seams?

Church World Service (New York) | May 4, 2006

Is the U.S. Trade Agenda Coming Apart at the Seams?

By Kathy McNeely
Washington, DC

U.S. Activists for trade justice dubbed the week of April 16 as the week of action. By the end of the week, thanks to key events revealing an unraveling of the Bush administration’s free trade agenda, trade activists campaigning for a more just global trade system celebrated victory.

Globally, the U.S. has been aggressively parading a model of free trade touted to catalyze development and lift countries out of poverty. A closer look at the details of particular free trade agreements (FTAs) reveals this assertion to be ridiculous. Not unlike the climax of Hans Christian Andersen’s tale,"The Emperor’s New Clothes," last week the countries that make up the Southern African Custom’s Union (Botswana, Lesotho, Namibia, Swaziland, and South Africa) refused to join the U.S. free trade parade - citing flaws in the fabric - a or one-size-fits-all template the U.S. offered.

Since free trade negotiations are in total secret, the exact contents and points of contention around the U.S.-SACU agreement are not yet known. What is known is that since June 2003 the talks have been on-again-off-again and were nowhere near meeting the aggressive agenda of being completed before President Bush’s "fast track" authority expired in July 2007. It is also understood that measures involving intellectual property rights included in other U.S. free trade agreements with the Central American region (CAFTA) and with Peru, was an extremely contentious issue for the SACU countries.

According to UNAIDS, Southern Africa is the epicenter of the global AIDS pandemic. The Bush administration’s free trade template includes excessive protection of drug company intellectual property rights so as to discourage the generic production of important, live saving drugs. Though there are many barriers to accessing AIDS medicines in any one of the five SACU countries, it is deplorable that the U.S. would add yet another barrier to treatment regimes in a region that is so ravaged by this and other treatable diseases.

Through a number of programs, people living with HIV and AIDS in the five SACU countries are receiving generic first line AIDS medications. With a U.S. free trade agreement, assuming it is similar in style to other FTAs, these treatments will not go away, but at a certain point people who take these medications will need second generation HIV drugs; and these are seven to twenty times more expensive than the first line medications now available in generic form. Provisions included in 2006 FTA negotiations would most likely prevent the manufacture of future necessary generic drugs.

South Africa’s first peek at the naked self interest of the U.S. was in 2000 when 39 pharmaceutical firms threatened to sue the South African Government for establishing a law that would allow South Africa to use flexibilities in World Trade Organization intellectual property rules to access needed medicines. After much public debate and a lot of bad press for the pharmaceutical firms involved, President Clinton issued an Executive Order (reaffirmed by President Bush in his first term) which states that the U.S. cannot pursue policy on Intellectual Property Rights in sub Saharan Africa that interfere with access to medicines used by people living with HIV/AIDS.

If the U.S.-SACU FTA is indeed cut from the same fabric as other recent free trade agreements, the Bush Administration would be "parading its naked self interest by violating this Executive Order in the pursuit of more stringent intellectual property rights for the region.

Again, since the free trade agreement negotiations are not shared with the public, it is impossible to know all the elements that led to the U.S. and SACU nations to turn away from negotiating a comprehensive FTA in favor of establishing a "Trade Investment Cooperation Agreement" (TICA) - the first of its kind. The TICA steps away from the all or nothing agenda and sets up a mechanism for developing work programs in areas that could lead to memoranda of understanding around certain areas typically included in an FTA like customs, trade facilitation and even intellectual property. The main objective seems to be to lead SACU governments back to the FTA negotiating table once the areas of greatest difficulty have been worked out.

The establishment of the TICA symbolizes the U.S. Trade Representative’s admission that US-SACU FTA negotiations would not finish before "fast track" expired. Rather than admit defeat, the U.S. Trade Representative’s office is developing a new strategy for keeping the negotiations going. If fast track is not renewed, TICA allows USTR to continue negotiations with Southern African countries to incrementally liberalize the markets and perhaps without congressional approval. If, on the other hand, fast track is renewed, TICA would allow USTR to continue negotiating the comprehensive FTA desired on a slower timeline.

On the same day that the U.S.-SACU FTA was demoted to a "TICA", Ambassador Robert Portman was asked to leave his post as the U.S. Trade Representative (USTR) and head the White House budget office. Perhaps indicating a shift in political priorities, possibly relegating trade to a back burner, Bush then named Deputy USTR Susan C. Schwab to be the new USTR. Schwab has considerable international trade experience but not Portman’s political clout - without which it is hard to imagine that she will have what it takes to "sell" the free trade agenda and pass FTAs like those with Peru and Colombia before fast track expires in July 2007.

In other parts of the world it seems there others willing to speak up about the empty promises of these free trade agreements. The week of April 14, the first indigenous president of Bolivia, Joan Eva Morales, launched a "people’s trade agreement" as an alternative free trade agreement that essentially rejects the framework of the U.S. recently negotiated with Peru and Colombia as well as the Free Trade Area of the Americas (FTAA) - a hemispheric trade agreement that has been stalled for the past 3 years.

That week also sealed the failure of the World Trade Organization to meet its deadline to conclude negotiations with a mini ministerial at the end of April. Yes, it was a big week for trade justice. As the free trade model begins to unravel, it’s important to mark the challenges out there that pull at the threads and expose the empty promise of development hidden in the rhetoric clad around free trade.

Kathy McNeely is a Policy Analyst/Advocate for Church World Service and member of the U.S. Interfaith Working Group on Trade and Investment, has worked in Washington DC educating and advocating on issues of economic justice, human rights, peace, and ecology for eight years. Though much of her Washington work has been Africa-specific, Kathy lived and worked in Central America for over six years.

This piece was first published on Wednesday, May 3, 2006 by CommonDreams.org.

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