Tag Archives: Free Trade Agreements

UK-Africa Relations Seminar Series Part 5

21 Sep

Back in July I was involved in hosting the fifth meeting of an ESRC Seminar Series on UK-Africa relations at my own institution, Oxford Brookes University. The theme of the day was ‘Trade in UK-Africa Relations’. This blog post is a summary of the discussions and some reflections on a number of the key themes that, from my perspective, emerged out of the seminar. Podcasts of all the presentations are available at the seminar series website.

Panel 1: The UK and African Development: Fair trade and/or trade justice?

The first panel during the morning considered the relationship between trade and African development. Liz May, who is Head of Policy at Traidcraft, gave a fascinating account of how her organisation is involved in providing support to producers, both in Africa, and other parts of the Global South. Her presentation outlined three areas of current advocacy work:

  1. Controlling unfair practices of UK supermarkets via a new regulatory body (The Groceries Code Adjudicator).
  2. A focus on Bilateral Investment Treaties (BITs) and the investment chapters of Free Trade Agreements (FTAs) and in particular the problematic inclusion of investor-state dispute settlement mechanisms, which limit the policy space for developing countries through what Liz described as ‘regulatory chill’.
  3. Increasing the legal power over the extra-territorial practices of UK companies.

Liz concluded that current UK government practice is, in some cases, undermining the developments that Traidcraft is seeking in all three of these campaign areas.

I then gave a presentation based on an ongoing research project, which is looking at the Trade Justice Movement (TJM), and its attempts to shape the debate on the relationship between trade and development. TJM was one of the three main pillars of Make Poverty History (MPH) in 2005. Ultimately TJM seeks to promote ‘trade justice’ as an alternative to free trade. During the last decade or more, however, the UK government has continued to support trade liberalisation and, in relation to Africa, the ‘prosperity agenda’ advanced by the Coalition government, discussed at the fourth seminar in the series, is even more resolutely in favour of free trade, with the emphasis on the benefits both for African economic growth and UK exporters and investors.

After lunch a further three speakers spoke to the broad theme of ‘UK-Africa Trade in a Changing Global Context’. Robin Gwynn, who has had a long and distinguished career as a diplomat, specialising in Africa, discussed the development of UK trade policy towards Africa during the 5 year term of office of the Coalition government. Commercial diplomacy, he argued, became more central during this period and given the impacts of the financial crisis, the emphasis was on searching for new markets. Hence, Africa became more significant as it was viewed as a ‘high-growth region’. Robin suggested that trade alone will not sustain growth in Africa unless there is a focus on job-creating economic activity. He also noted that some African governments are requiring higher standards of trade and investment and they need to be supported in this endeavour. Ultimately trade and investment, argued Robin, have to be at the centre of any future development in Africa.

In contrast, the final two speakers, in very different ways, then exposed some of the dangers that trade and investment policy can have for African development. Peg Murray-Evans (University of York) explored the intricacies of the varied negotiating positions adopted by states in Southern Africa in their Economic Partnership Agreement (EPA) negotiations with the EU. She noted how one of the outcomes of the regional EPA negotiations is that different African countries now have a range of trade regimes with the EU, which may ultimately skew UK trade and investment decisions. Peg concluded by noting the concern that South Africa and other key African states raised in the EPA negotiations, over the point made earlier in the day by Liz May, about the potential for these new trade deals to limit the ‘policy space’ for African countries.

Our final speaker, John Hilary (War On Want) began by reminding everyone that history tells us that successful development has not been achieved in other parts of the world via a ‘deep integration’ model of trade. Nevertheless, John argued that although the rhetoric might have been different under New Labour, in essence the UK government has continued to have a firm commitment to trade liberalisation across Africa. The second half of his presentation then considered the NGO response to this over recent years. He noted how many key players in the UK have moved away from trade in the period since MPH in 2005 and how difficult it was to build a mass public campaign around the EPA negotiations, discussed by Peg. John optimistically concluded that unlike EPAs, the Transatlantic Trade and Investment Partnership, which is currently being negotiated between the US and the EU, allows a re-emergence of the debate on trade by opening up the broader issues of power being acquired by capital.

Overall, it was both an enjoyable and stimulating day of discussions. I was left with lots of questions and fewer answers! I guess this is the point, however. In particular, the following thoughts struck me as worth further consideration:

  1. Trade is increasingly about so much more than imports and exports, with investment becoming centre stage in both the UK and EU’s position.
  2. Is UK trade policy conducive to human development in Africa? Are existing regulatory measures (such as the focus on the practice of UK supermarkets) sufficient in this regard?
  3. There are alternatives to the orthodox view that trade liberalisation is good for development. However, for the UK government this remains a key assumption. By being critical of this stance, as John Hilary emphasised in his presentation, does not mean that we have to adopt a position where we are against the idea of trade. The challenge is how we move from the idea of fair trade to realising the more systemic changes captured by the concept of ‘trade justice’.

The next seminar in the series is scheduled for 20 January 2016 in London where the theme will be ‘Africa in the UK Public Imagination’. Further details and podcasts from other seminars can be found at the the series website. For updates do follow the series on twitter: @UKAfricaSeminar

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Trade Union Solidarity and Free Trade

25 Feb

Do trade unions matter in the Twenty-First Century? How are they responding to ongoing processes of neoliberal restructuring? In particular, what obstacles do they face in developing transnational solidarity against the rise of free trade? What is clear is that national labour movements in different parts of the world have, at times, responded differently to the deepening of trade liberalisation in recent years. This is because the immediate impact they face differs depending on their place within the structure of the global economy.

In a new academic article published earlier this month I explore these questions through a study of how the biggest trade union federation in South Africa – the Congress of South African Trade Unions (COSATU) – has reacted to both multilateral and bilateral trade liberalisation. COSATU

The article forms part of a special issue of the journal Globalizations, which considers the theme of ‘Free Trade and Transnational Labour’. My contribution also considers the extent to which COSATU has engaged in building transnational links with labour movements outside of South Africa and how effective these attempts have been.

COSATU was formed in 1985 and since the end of apartheid its membership has grown significantly. At its most recent National Congress in 2012 it reported a total of 2.2 million members across its 21 affiliated trade unions.

The post-apartheid era in South Africa has seen the government embrace the free trade agenda. This was most clearly demonstrated when it adopted its Growth, Employment and Redistribution (GEAR) strategy way back in 1996. Despite criticism from COSATU, this represented an acceptance of the neoliberal development model, and in particular the need for South Africa to unilaterally reduce its barriers to trade. At the time COSATU took the position that a more strategic engagement with the global economy was needed. More recently government policy has, to some extent, begun to reflect such a view. The ‘New Growth Path‘ launched in 2010 does place much more emphasis on employment and an active industrial policy although COSATU’s leadership has expressed some serious concerns that the subsequent ‘National Development Plan‘, which was launched in 2012, undermines this shift in approach.

COSATU has been active, to varying degrees, in seeking to build transnational solidarity against both further trade liberalisation within the World Trade Organisation (WTO) and a number of bilateral negotiations involving South Africa. However, these attempts reveal a number of challenges to transnational labour solidarity in the face of free trade. Ultimately, COSATU is first and foremost a national federation and as such it prioritises the needs of its members. As a result the protection of jobs and working conditions within South Africa are its core remit and a number of obstacles to transnational solidarity remain:

  1. Tensions within COSATU are currently high as a result of its relationship with the African National Congress (ANC) in the form of the tripartite alliance. One of the major unions within COSATU, the National Union of Metalworkers (NUMSA) has broken ranks by refusing to endorse the ANC in the forthcoming elections in May 2014 and has questioned the continued viability of the federation itself. Continuing to be in alliance with the ANC does make it difficult to then provide genuine resistance to the trade liberalisation agenda led by the government.
  2. COSATU’s experience of trying to develop solidarity with the European Trade Union Council (ETUC) over WTO proposals for Non-Agricultural Market Access (NAMA) highlights some of the specific issues faced by trade unions in the Global South. In this case one ETUC member, the European Metalworkers’ Federation, joined forces with the owners of the car industry in Europe to undermine the concerns raised by emerging markets, including South Africa, that NAMA would harm key labour-intensive sectors.
  3. At the regional level similar dynamics can be seen but this time it is COSATU that finds itself defending the interests of the dominant national trading power. During the negotiations towards a Free Trade Area within the Southern African Development Community (SADC), COSATU expressed concerns that the domestic clothing and textiles sector could be undermined by cheaper goods of lower quality produced in other parts of Southern Africa.

Given these difficulties in resolving the positions of different national trade unions maybe we should focus on the International Trade Union Confederation (ITUC), which claims on its website to represent ‘the global voice of the world’s working people’. However, ITUC’s approach to free trade agreements has been a reformist agenda based on securing the inclusion of basic labour standards to mitigate any negative impacts on workers. This has led to some of COSATU’s affiliates leaving ITUC. They argue that a more radical approach is needed, which seeks to resist the actual introduction of free trade agreements in the first place, rather than one that seeks to ameliorate their impact on labour.

Instead we may look to the Southern Initiative on Globalisation and Trade Union Rights (SIGTUR). Observations on SIGTUR’s most recent Congress do suggest that it may be a more appropriate avenue for federations like COSATU to focus its energies. Whether it can overcome all of the obstacles identified above remains to be seen.

In sum, workers the world over face common challenges in the face of neoliberal globalisation. These processes can be resisted and, despite some of the difficulties identified above, trade unions should continue to seek to develop solidarity across national borders.

* A limited number of free downloads of the full article are available at http://www.tandfonline.com/eprint/IBjNTuYMkh83UQdYKYAB/full

World Trade: Ten Years On From Cancún

14 Sep

Image by Global Justice Posters

It was ten years ago today that talks at the Ministerial Conference of the World Trade Organization (WTO), held in Cancún, Mexico ended in deadlock. Member states could not agree a consensus mainly due to a lack of movement by the developed world on agricultural subsidies and their insistence on the inclusion of new trade issues. At the time, many development campaigners and a number of negotiators from the developing world celebrated the fact that the world’s leading trade powers had failed in their attempt to push for agreement on the so-called ‘Singapore Issues’.

Did this represent the increased activism of developing states in global trade? What has happened during the decade since Cancún?

A week after the Conference in September 2003 Robert Zoellick, then US trade representative, wrote in a piece for the Financial Times that,

“the key division at Cancún was between the can-do and the won’t-do. For over two years, the US has pushed to open markets globally, in our hemisphere, and with sub-regions or individual countries. As WTO members ponder the future, the US will not wait: we will move towards free trade with can-do countries”.

With hindsight it appears that such comments were not simply diplomatic rhetoric. What we have witnessed since 2003 is a shift in the approach of the established trade powers. They have moved towards a focus on bilateral and regional trade agreements with developing countries and emerging markets, in particular, rather than multilateral negotiations within the WTO.

The European Union (EU), in particular, has embarked on numerous bilateral trade negotiations in recent years. As of August this year the European Commission reported that it has 29 trade agreements in place and is currently negotiating with Japan, the US, Canada, Malaysia, Vietnam, Thailand, Morocco, India, Mercosur (regional grouping in Latin America), Moldova, Armenia, Georgia, Ukraine, Costa Rica, El Salvador, Guatemala – to name but a few!

Particularly contentious for many development NGOs has been the negotiation of Economic Partnership Agreements (EPAs) with African, Caribbean and Pacific (ACP) states, which has allowed the EU to include at the bilateral level many of the issues that developing countries had resisted at Cancún. The power asymmetry between the EU and the ACP sub-regions involved in the EPA negotiations has enabled them to determine the key aspects of the negotiating agenda. The EU has pursued a ‘deep integration’ approach to its trade negotiations aiming to secure FTAs that go beyond simply the liberalisation of trade in goods.

This has meant the re-introduction of the ‘Singapore Issues’ onto the negotiating table. They refer to the inclusion of investment, competition policy, government procurement and trade facilitation measures. Their introduction (except trade facilitation) would mean that European firms would have to be treated in the same way as any domestic provider. This would pose significant limits to the range of development strategies available given that regulatory policy, previously the preserve of national politics, would become part of the FTA. In particular it would prevent the adoption of an active industrial policy. The introduction of these behind-the-border issues would also create a harmonisation of the business environment in line with the liberal model adopted in Europe, which would be of benefit to European business sectors looking to invest in partner countries.

In essence, what the last decade has revealed is that the focal point of the trade liberalisation agenda has shifted away from the WTO to bilateral trade negotiations. For those of us who seek to resist the neoliberal free trade agenda we must be careful what we wish for!

* A much more detailed (and considered!) elaboration of some of the arguments presented here can be found in Stephen R. Hurt (2013) ‘African agency in world trade undermined? The case of bilateral relations with the European Union’ in William Brown and Sophie Harman (eds), African Agency in International Politics, Abingdon: Routledge, pp. 49-64.