By Aziz Choudry
Canada’s ambassador to the WTO, Sergio Marchi defended the invitation-only nature of the informal mini-Ministerial held in Montreal from 28-30 July, claiming: "Someone has to act as the locomotive for the entire train". As many opponents of neo-liberal globalisation organise to derail the WTO, free trade’s true believers must be wondering what happened to the railtrack.

Ministers and officials from 26 WTO member countries met in the Canadian city in an eleventh hour bid to jumpstart seriously lagging trade negotiations before September’s Ministerial Meeting in Cancun which has left a deeply divided body struggling with major credibility and image problems.

High on the meeting’s agenda remained the vexed issue of agriculture. Meeting host and Canada’s Minister for International Trade, Pierre Pettigrew attacked both EU and US agricultural subsidies, and promised a successful meeting (for free traders) "so that when we arrive in Cancun, we are already hot."

But the rug had quite literally been pulled from under Pettigrew’s feet little over a week earlier, when Montreal’s Queen Elizabeth Hotel backed out of providing the venue, citing concerns about inconvenience to its guests. The nearby Sheraton came to the rescue, but not before the Canadian government and the WTO had been unexpectedly turfed out of one of the city’s ritziest establishments. It was the first WTO meeting to be held in North America since
Seattle and was accompanied by a major security operation which militarised and disrupted parts of the city for several days.

After Pettigrew’s boasting that the anti-globalization movement had "completely disappeared", a well-attended anti-WTO teach-in at the Universite du Quebec a Montreal and a 2000-strong march and rally on the eve of the meeting proved him wrong. On 28 July, a march of a thousand activists attempted to reach the Sheraton to disrupt and if possible shut down the conference but was blocked by a heavy contingent of riot police. While Pettigrew "consulted" ‘civil society’ – some selected NGOs and business representatives – and posed for a photo-op, police surrounded peaceful protesters and made mass arrests. Demonstrations continued until after the meeting had concluded.

While the Montreal Popular Mobilization against the WTO may not have been able to shut the meetings down, the widely divergent positions of the countries selected to attend the Montreal meeting destined the talks to be a flop.

Pettigrew’s apparent optimism about the meeting was shared by almost nobody, and became more muted as the days went by.
A draft Cancun Ministerial text circulated on 18 July had already attracted strong criticism for its predictable tilt towards the interests of the industrialised North, and its failure to reflect the views held by many Southern delegations on many issues. It further revealed the WTO’s fundamentally anti-democratic processes which have consistently excluded the delegations from many poorer countries from having any input into its content.

Tension surrounds bilateral discussions between the EU and the USA over agriculture. At the conclusion of the Montreal meeting, Gregor Kreuzhuber, spokesman for EU agriculture commissioner Franz Fischler said that it "should not be misinterpreted that we are trying to cook up a deal between Europe and the US that would leave the other 144 countries in the cold." But that was precisely what happened towards the end of the GATT Uruguay Round, so it seems unlikely that many countries will be convinced. Fischler says that "the two major trading blocs have to lead by example, but it takes 146 to tango." Many countries are tired of dancing to a tune set by the US and the EU, in the interests of their transnational corporations as neo-liberal policies displace and impoverish more and more of their population.

The US favours direct aid to its farmers, while the EU subsidises farm exports and pays farmers for increased production. Both proposed cuts to agricultural subsidies, but in ways which the other party claimed was inadequate and protectionist. The EU is suggesting across-the-board proportionate tariff cuts, while the US seeks a single universal low level for tariffs, with bigger cuts for higher tariffs. Naturally, both formulae favour their respective corporate farm sectors. Meanwhile both demand more agricultural liberalisation – and commitments to open up other sectors – from the Third World, whose farmers are being displaced, plunged into poverty and despair by floods of subsidised food imports.

Other contentious areas showed little signs of "progress". The EU/US dispute over genetically-modified organisms went unresolved. The US remains dissatisfied with the EU, even after a move to allow the sale of GM foods if products containing over 0.9% genetically-modified protein or DNA are labelled. The US says it is pursuing a WTO complaint against what it claims is the EU’s unscientific and protectionist stance on biotechnology.

Despite more promises, there was no breakthrough on the issue of poor countries being able to override the patents of pharmaceutical corporations in order to manufacture or import cheaper generic drugs, which has been a major
sticking point, especially for countries struggling to cope with HIV/AIDS and other health crises. A few days before the Montreal meetings, Pettigrew accused anti-WTO protesters of screwing African AIDS victims – not the WTO’s trade-related aspects of Intellectual Property Rights (TRIPS) agreement which upholds drug corporations monopoly patent rights.

India’s disinvestment and telecommunications minister, Arun Shourie, claimed the support of China for his government’s stance against the attempted introduction of negotiations on the "Singapore issues" (investment, transparency in government procurement, competition policy and trade facilitation), without explicit consensus. He said "there should be no last minute surprises sprung on delegates, which had characterised the past rounds of multilateral trade negotiations." He also warned, "We should not be asked to take the first step without knowing where the journey would end." Arun Shourie argued that unfettered agricultural liberalisation commitments forced upon Third World nations could spell yet more bad news for the millions of Indians dependent on farming for the livelihoods and food security. He spoke of a growing resentment and backlash from the Third World should people feel that the speed of economic reforms is being dictated from outside.

Now, politicians and officials are talking tough and playing hardball as the clock ticks down towards Cancun. A number of Cairns Group (agricultural-exporting) countries are threatening to walk out of WTO talks if they consider that not enough progress has been made on agriculture. Agreement on agriculture remains key to paving the way for commitments to liberalise other sectors, such as services, and to gain leverage for efforts to get talks on the Singapore issues after Cancun.

Canadians have no illusions about the implications of a potential WTO investment agreement. Under the investment chapter of the decade-old North American Free Trade Agreement (NAFTA) they have already felt how disgruntled corporations, through an investor-to-state mechanism can sue a government over measures which they claim interfere with rights to make a profit. Perhaps most notoriously, US chemical corporation, Ethyl Corp, used NAFTA to sue Ottawa for a 1997 federal ban on imports of a fuel additive, MMT, because it was toxic and hazardous to public health. Ottawa backed down, removed the ban, paid the corporation US $13 million (it had demanded $250 million) and apologised. Agreement to start negotiations on the Singapore issues would herald the repeat of this scenario in 146 countries, and deliver global capital a comprehensive and enforceable bill of rights and freedoms.

If the WTO fails to fire at Cancun, how will this affect the Free Trade Area of the Americas and other trade and investment liberalisation projects? As we head towards the halfway mark for the conclusion of the WTO negotiations set at Doha, after negotiating deadline after deadline has been missed, how will the free trade spindoctors concoct a success story out of failure? How to manage the ongoing resentment of Third World governments and peoples at having their concerns unceremoniously ignored as the EU and US once again take
command of the centre-stage at the WTO? More Doha-style bullying and dirty tactics? And will we see redoubled efforts to stitch up radical bilateral and sub-regional trade and investment negotiations such as the Central American Free Trade Agreement (CAFTA) which the US hoped to conclude by the year’s end?

>From August 11, WTO Director-General Supachai Panitchpakdi, who also came to Montreal, will convene daily meetings for heads of delegations to try to move forward on the gridlocked WTO talks.

In Montreal, South Africa’s trade minister, Alec Irwin summed up the state of play, saying, "We have got a major problem".
As the WTO’s legitimacy and credibility continues to dwindle in the eyes of the world’s neoliberals, we should redouble our efforts to delegitimise the institution and the destructive model of "development" which it promotes.

* Aziz Choudry is an activist with the Aeteroa/New Zealand campaign GATT Watchdog. his article was first published on