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Rigged rules and double standards: trade, globalisation and the fight against poverty
The rich world is robbing the poor world of $100 billion a year and denying millions of poor people their best escape route from poverty
Authors:
K. Watkins; P. Fowler
Publisher:
Oxfam, 2002
This report constitutes Oxfams analysis of the links between trade rules and poverty and as such forms the basis of their 'make trade fair' campaign. It's central arguement is that current trade rules and institutions are rigged in favour of developed nations in the north and that the direction of trade liberalisation must change to make trade fairer.
The authors identify 5 ways in which trade rules are rigged:
- Subsidising rich farmers $1bn a day. Over-production of agricultural surpluses is dumped onto world markets, suppressing world prices and destroying local markets in poor countries
- Influencing the International Monetary Fund and the World Bank polices to prise open poor countries' markets with little regard to the social consequences. These are policies the rich world has itself rejected.
- Stopping or penalising poor countries from exporting their goods into rich world markets. Goods from poor countries are taxed at four times the rate of goods from rich countries.
- Being indifferent to erratic, falling commodity prices that condemn many poor economies to failure, while generating huge profits for big corporations.
- Allowing big corporations to ride rough shod over internationally recognised workers rights.
The report also highlights that while some countries appear to be successfully boosting their economies through increased exports this has had little impact on levels of poverty. Oxfam calls on poor country governments to adopt policies so that the economic benefits of trade help to alleviate poverty and do not increase inequality and suggests the following reforms of the world trade system:
- Ending the use of conditions attached to IMF-World Bank programmes which force poor countries to open their markets regardless of the impact on poor people.
- Improving market access for poor countries and ending the cycle of subsidised agricultural over-production and export dumping by rich countries, without demanding further concessions of developing countries.
- Creating a new international commodities institution to raise prices to levels consistent with a reasonable standard of living for producers, and changing corporate practices so that companies pay fair prices.
- Establishing new intellectual-property rules to ensure that poor countries are able to afford new technologies and basic medicines, and that farmers are able to save, exchange, and sell seeds.
- Prohibiting rules that force governments to liberalise or privatise basic services that are vital for poverty reduction.
- Enhancing the quality of private-sector investment and employment standards.
- Democratising the WTO to give poor countries a stronger voice.
- Changing national policies on health, education, and governance so that people can develop their capabilities, realise their potential, and participate in markets on more equitable terms.
