Trade justice

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Activists from Christian Aid lobbying for Trade Justice Christian Aid campaigners with Hilary Benn and Andrew Smith 20050127.jpg
Activists from Christian Aid lobbying for Trade Justice

Trade justice is a campaign by non-governmental organisations, plus efforts by other actors, to change the rules and practices of world trade in order to promote fairness. These organizations include consumer groups, trade unions, faith groups, aid agencies and environmental groups.

Contents

The organizations campaigning for trade justice posit this concept in opposition to free trade. Supporters of free trade, typically those in economics, business, lobbying, and the mainstream press, trust in the “invisible hand” of the market to provide on its own for the needs of societies around the world. [1] [2] Fundamental to their beliefs is the value of individual liberty, believed to be the least infringed upon when the market is used to replace most of the centralized government's responsibilities of allocating resources. [2] They tend to support neoliberal policies of privatization, deregulation, and tax cuts, and on the international trade level, policies that loosen restrictions on corporations’ ability to trade and make profits across borders. [2] Rupert argues that because free trade advocates placed themselves on the side of “science," they would label activists as ignorant, protectionist, and selfish. [2] Activists would be designated as “anti-globalization,” a term first coined by New York Times columnist Thomas Friedman. [3]

Trade justice advocates are not anti-globalization, but are instead against corporate-centered trade liberalization which ignores labor, environmental, and human rights. [3] They argue that truly free trade does not and will never exist, and that governmental policies on trade should be in the public interest, rather than the interest of wealthy entities who they argue try to influence trade negotiation to benefit their individual interests. [4] Rupert argues that they are cautious of the spread of neoliberal policies to the point where the power of private corporations will be enhanced to the point of “business totalitarianism”. [2] Advocates of trade justice argue that growing inequity and serious gaps in social justice, and the global export of terrorism, are symptoms of an economic system that permits harms to be exported to other countries, while importing their goods. They point to extinction, deforestation, social unrest, as consequences of globalization, and in particular of an "unfair" globalization. [5] In the past, the responses sought by critics of the international trade system included various penalties on "unfair" goods. This argument generally made little headway against the long-term movement towards free trade; imposition of penalties for "dumping" was sometimes motivated by domestic political reasons such as the United States imposition of steel tariffs in 2001).

Today, the trade justice movement concentrates more on the abolition of agricultural subsidies and dumping, and to a much lesser extent on offsetting penalties on "unfair" goods. Indeed, although there are many who are still critical of free trade in general, there is a trend towards campaigning against what is seen as hypocrisy by developed countries in using protectionism against the poorest countries, especially in agricultural products, while requiring them to leave their own producers without protection.

Trade justice movement

The Trade Justice Movement in the UK was the first formal coalition of groups to use the term "trade justice" (partly because in the UK, "fair trade" usually refers to Fairtrade certification and is a consumer model of change rather than an overtly political movement calling for government action). The term trade justice has been widely adopted internationally by campaign groups, for example by the over 100 national platforms of the Global Call to Action Against Poverty where it is one of the four main demands. In many countries "fair trade" is used as well as or instead of "trade justice".

The global institutions that are most often targeted in trade justice campaigns against the alleged injustices of the current international trade system are the World Trade Organization (WTO), the International Monetary Fund (IMF) and the World Bank (WB). Campaigners also lobby their own governments with the intention of creating pressure on them to prioritise poverty reduction when making international trade rules. In trading blocs such as the European Union (EU), the campaigns seek to influence policy across a number of member state governments.

"Trade Justice" and "Fair Trade" were originally used by those supporting social justice and the alleviation of the intense poverty found in many developing nations. They contrasted "fair trade" with 'unfair' international trade practices. It is associated particularly with labour unions and environmentalists, in their criticism of disparities between the protections for capital versus those for labour and the environment. The use of the term has expanded beyond campaigns to reform current trading practices, and the major institutions such as the World Trade Organization which embody them. Now it has become a movement to allow consumers to choose not to participate in these practices. Fairtrade labelling or "Fairtrade certification" allows consumers to identify goods especially commodities such as coffee, that meet certain agreed standards of fairness.

Framing

Ayres argues that generating a clear consensus between different groups in the trade justice movement is straightforward for “diagnostic framing”– identifying the problem and its many identifiable negative effects. [3] They can agree that free trade policies have contributed to the rising debt of developing countries, the widening wealth gaps, economic instability, environmental degradation, human rights abuses, and poverty. [3] Organizations have difficulty consolidating a “prognostic framing”– how advocates should go about actually solving the problems they have identified. [3] Some hope to reform the WTO and include rights considerations in trade agreements, while others hope for more extreme measures. [3] When it comes to strategies, some lean more towards collaborating with existing powers through NGOs, while others hope to make change through grassroots organization and protesting. [3]

Issues

Academics such as Thomas Alured Faunce argue that the insertion of a constructive ambiguity such as valuing innovation in bilateral trade agreements (and then according normative and ongoing lobbying power to such textual negotiating truces by formally linking them with non-violation nullification of benefits provisions) may undermine democratic sovereignty with regard to construction of domestic policy, particularly in areas such as the environment and public health. [6] [7] This view is strenuously contested by trade law officials and many domestic policy makers.[ citation needed ]

"The mostly widely referred to demand of trade justice campaigners is access to the markets of developed countries or rich countries. When developing countries export to developed country markets, they often face tariff barriers that can be as much as four times higher than those encountered by developed countries. Poverty claims that those barriers cost poor countries $100 billion a year – twice as much as they receive in aid." [8]

The term "trade justice" emphasizes that even if the playing field were level, instead of tilted against developing countries, the poorest developing countries in particular would still struggle to gain from trade if forced to trade under free trade terms. This is because of their overwhelming lack of competitiveness – poor countries do not have huge stocks of exports waiting to be shipped to rich countries, instead most small farmers want to be able to sell their goods locally.[ citation needed ] [9] [10]

Subsidies

Most trade justice campaigners focus in some way on the agricultural subsidies of rich countries that make it difficult for farmers in poor countries to compete. For example, they argue that the European Union's agricultural export subsidies encourage overproduction of goods such as tomatoes or sugar, which are then sold cheaply or 'dumped' in poor countries. Local farmers cannot sell their goods as cheaply and go out of business. [11]

The campaign points to the treatment of agriculture at the WTO, which has institutionalized these injustices. In the few instances where developing countries have used the complex and expensive WTO process to declare subsidies (e.g. US cotton subsidies) excessive, developed countries ignore these rulings, which the WTO itself does not enforce. Recently rich countries have begun to talk about cutting export subsidies, but they often demand greater access to poor country markets in return.[ citation needed ]

The Impact of Trade on the Environment

According to the Organization for Economic Co-operation and Development (OECD), there is both a positive and negative impact of trade on the environment. [12] On the one hand, economic growth from trade can negatively affect the environment in two ways. First, economic growth increases pollution due to natural resource extraction. As the world looks to transition towards a more environmentally friendly economy, global demand for lithium-ion batteries – a key component in electric vehicles – is expected to reach 2.2 million tonnes by 2030. [13] The extractivism required to mine lithium leads to air, water, and soil pollution due to the toxic chemicals used during the mining process, and the depletion of local water reserves. [14] Second, trade liberalization can lead to specialization in pollution-intensive sectors if environmental regulations are different across countries (pollution haven hypothesis). Conversely, economic growth stemming from trade increases the capacity of a country to manage the environment more efficiently and stricter environmental regulations in certain countries have a spillover effect that will force suppliers to adapt to environmentally conscious markets. These environmental policies create markets for environmental goods to be exported to countries that follow the same standards. [12]

Challenges for Environmental Protection in Trade

Environmental justice efforts are a significant component of the trade justice movement. The principle of free trade based on economic opportunity for all ignores the environmental degradation that comes as a result. Moreover, power imbalances within the WTO, the United Nations and other international governing bodies have allowed developed countries to control environmental trade regulations. This has led to disagreements regarding whether environmentalism protects the global South and its resources or is an imperialist tool to stunt the economic and industrial growth of developing nations. [15] In particular, the former argument states that “robust environmental regulation” [16] is needed to protect the “natural resource base upon which the South relies for survival.” [15] However, others claim that international governing bodies cannot set environmental policy based on equality rather than equity; these policies cannot overlook the fact that the global North's consumption habits are the primary cause of environmental degradation. [15] Environmental burdens must be distributed proportionately for environmentalism to not be used as a neo-imperial tool. This perspective has been enhanced by controversies of the Summers memo and many instances of improper waste disposal in the Global South based on weak political infrastructures that allow large organizations to avoid strict regulation.

“While Southern elites can insulate themselves to some extent from the consequences of the waste trade by moving into more pristine communities with better access to clean air and water and uncontaminated land, it is the poor who must suffer the consequences of environmental degradation. Far from being a luxury, environmental protection is necessary to preserve the health, safety and well-being of the Southern poor." [15]

Despite a push by the OECD to increase demand for environmental products and technology, thereby complementing trade with environmental policy, [17] examples as recent as fall 2021 show nations disregarding these considerations. A leaked document from the UK's Department for International Trade says that trade negotiators should prioritize economic growth over the environment in trade deals. [18] This document comes after it was found that the UK dropped climate related promises to finalize a trade deal with Australia. [19]

Ultimately, the debate continues as environmentalists prioritize environmental protection over economic growth and governing bodies and organizations stall to implement binding policy. Many researchers and environmental groups demand increased transparency and participation from non-governmental stakeholders in policy adjudication.

The Future of Environmental Trade

The challenge for the Trade Justice movement, particularly from an environmental perspective, is embedding principles of environmental stewardship that inspires a new generation of trade agreements. Previous free trade deals have favoured investor rights that disregard environmental concerns. Professors from Saint Mary's University in Halifax argue that future treaties must have rules with enforceable commitments and dispute settling bodies, such as those found at the WTO, and not the voluntary actions undertaken in treaties like The Paris Agreement. The authors assert that multilateral forums found in the UN are perceived as places where progressive agendas go to die as they are hindered by opposition or disinterest from powerful states who prioritize their national interests over the common good. A solution is to strengthen the language surrounding environmental regulations in treaties to match those found in the investment rights sections of trade deals. [20]

See also

Related Research Articles

The General Agreement on Tariffs and Trade (GATT) is a legal agreement between many countries, whose overall purpose was to promote international trade by reducing or eliminating trade barriers such as tariffs or quotas. According to its preamble, its purpose was the "substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis."

<span class="mw-page-title-main">World Trade Organization</span> Intergovernmental trade organization

The World Trade Organization (WTO) is an intergovernmental organization headquartered in Geneva, Switzerland that regulates and facilitates international trade. Governments use the organization to establish, revise, and enforce the rules that govern international trade in cooperation with the United Nations System. The WTO is the world's largest international economic organization, with 164 member states representing over 98% of global trade and global GDP.

A subsidy or government incentive is a type of government expenditure for individuals and households, as well as businesses with the aim of stabilizing the economy. It ensures that individuals and households are viable by having access to essential goods and services while giving businesses the opportunity to stay afloat and/or competitive. Subsidies not only promote long term economic stability but also help governments to respond to economic shocks during a recession or in response to unforeseen shocks, such as the COVID-19 pandemic.

<span class="mw-page-title-main">Agricultural policy</span> Laws relating to domestic agriculture and foreign-imported agricultural products

Agricultural policy describes a set of laws relating to domestic agriculture and imports of foreign agricultural products. Governments usually implement agricultural policies with the goal of achieving a specific outcome in the domestic agricultural product markets.

<span class="mw-page-title-main">Agricultural subsidy</span> Governmental subsidy paid to farmers and agribusinesses

An agricultural subsidy is a government incentive paid to agribusinesses, agricultural organizations and farms to supplement their income, manage the supply of agricultural commodities, and influence the cost and supply of such commodities.

<span class="mw-page-title-main">Trade agreement</span> Wide ranging taxes, tariff and trade treaty

A trade agreement is a wide-ranging taxes, tariff and trade treaty that often includes investment guarantees. It exists when two or more countries agree on terms that help them trade with each other. The most common trade agreements are of the preferential and free trade types, which are concluded in order to reduce tariffs, quotas and other trade restrictions on items traded between the signatories.

Dumping, in economics, is a form of predatory pricing, especially in the context of international trade. It occurs when manufacturers export a product to another country at a price below the normal price with an injuring effect. The objective of dumping is to increase market share in a foreign market by driving out competition and thereby create a monopoly situation where the exporter will be able to unilaterally dictate price and quality of the product. Trade treaties might include mechanisms to alleviate problems related to dumping, such as countervailing duty penalties and anti-dumping statutes.

<span class="mw-page-title-main">Non-tariff barriers to trade</span> Type of trade barriers

Non-tariff barriers to trade are trade barriers that restrict imports or exports of goods or services through mechanisms other than the simple imposition of tariffs. Such barriers are subject to controversy and debate, as they may comply with international rules on trade yet serve protectionist purposes.

The Multilateral Agreement on Investment (MAI) was a draft agreement negotiated in secret between members of the Organisation for Economic Co-operation and Development (OECD) between 1995 and 1998. It sought to establish a new body of universal investment laws that would grant corporations unconditional rights to engage in financial operations around the world, without any regard to national laws and citizens' rights. The draft gave corporations a right to sue governments if national health, labor or environment legislation threatened their interests. When its draft became public in 1997, it drew widespread criticism from civil society groups and developing countries, particularly over the possibility that the agreement would make it difficult to regulate foreign investors. After an intense global campaign was waged against the MAI by the treaty's critics, the host nation France announced in October 1998 that it would not support the agreement, effectively preventing its adoption due to the OECD's consensus procedures.

<span class="mw-page-title-main">Regional integration</span> International cooperation within a region of the world

Regional Integration is a process in which neighboring countries enter into an agreement in order to upgrade cooperation through common institutions and rules. The objectives of the agreement could range from economic to political to environmental, although it has typically taken the form of a political economy initiative where commercial interests are the focus for achieving broader socio-political and security objectives, as defined by national governments. Regional integration has been organized either via supranational institutional structures or through intergovernmental decision-making, or a combination of both.

The Agreement on Agriculture (AoA) is an international treaty of the World Trade Organization. It was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO on 1 January 1995.

<span class="mw-page-title-main">Environmental dumping</span>

Environmental harmful product dumping is the practice of transfrontier shipment of waste from one country to another. The goal is to take the waste to a country that has less strict environmental laws, or environmental laws that are not strictly enforced. The economic benefit of this practice is cheap disposal or recycling of waste without the economic regulations of the original country.

<span class="mw-page-title-main">Trade facilitation</span> Policies intended to encourage trade between nations

Trade facilitation looks at how procedures and controls governing the movement of goods across national borders can be improved to reduce associated cost burdens and maximise efficiency while safeguarding legitimate regulatory objectives. Business costs may be a direct function of collecting information and submitting declarations or an indirect consequence of border checks in the form of delays and associated time penalties, forgone business opportunities and reduced competitiveness.

<span class="mw-page-title-main">Criticism of the World Trade Organization</span> Criticism directed at the World Trade Organization

Since its creation in 1995, the World Trade Organization (WTO) has worked to maintain and develop international trade. As one of the largest international economic organizations, it has strong influence and control over trading rules and agreements, and thus has the ability to affect a country's economy immensely. The WTO policies aim to balance tariffs and other forms of economic protection with a trade liberalization policy, and to "ensure that trade flows as smoothly, predictably and freely as possible". Indeed, the WTO claims that its actions "cut living costs and raise standards, stimulate economic growth and development, help countries develop, [and] give the weak a stronger voice." Statistically speaking, global trade has consistently grown between one and six percent per annum over the past decade, and US$38.8 billion were allocated to Aid for Trade in 2016.

Success in export markets for developed and developing country firms is increasingly affected by the ability of countries to support an environment which promotes efficient and low cost trade services and logistics. Trade facilitation and economic development policies reflect the idea that trade can be a powerful engine for accelerating economic growth, job creation, and poverty reduction.

An eco-tariff, also known as an environmental tariff or carbon tariff, is a trade barrier for the purpose of reducing pollution and improving the environment. These trade barriers may take the form of import or export taxes on products that have a large carbon footprint or are imported from countries with lax environmental regulations. The EU Carbon Border Adjustment Mechanism is a carbon tariff.

<span class="mw-page-title-main">Vangelis Vitalis</span> New Zealand diplomat and trade negotiator

Vangelis (Evangelos) Vitalis is a New Zealand diplomat and trade negotiator currently working as the Deputy Secretary for the country's Ministry of Foreign Affairs and Trade.

<span class="mw-page-title-main">Alter-globalization</span> Social movement

Alter-globalization is a social movement whose proponents support global cooperation and interaction, but oppose what they describe as the negative effects of economic globalization, considering it to often work to the detriment of, or to not adequately promote, human values such as environmental and climate protection, economic justice, labor protection, protection of indigenous cultures, peace and civil liberties. The movement is related to the global justice movement.

<span class="mw-page-title-main">Anti-globalization movement</span> Worldwide political movement against multinational corporations

The anti-globalization movement, or counter-globalization movement, is a social movement critical of economic globalization. The movement is also commonly referred to as the global justice movement, alter-globalization movement, anti-globalist movement, anti-corporate globalization movement, or movement against neoliberal globalization. There are many definitions of anti-globalization.

The global waste trade is the international trade of waste between countries for further treatment, disposal, or recycling. Toxic or hazardous wastes are often imported by developing countries from developed countries.

References

  1. ↑ Summers, Clyde (2001-04-01). "The Battle in Seattle: Free Trade, Labor Rights, and Societal Values". University of Pennsylvania Journal of International Law. 22 (1): 61. ISSN   1086-7872.
  2. 1 2 3 4 5 Rupert, Mark E. (1995-12-01). "(Re)Politicizing the global economy: Liberal common sense and ideological struggle in the US NAFTA debate". Review of International Political Economy. 2 (4): 658–692. doi:10.1080/09692299508434337. ISSN   0969-2290.
  3. 1 2 3 4 5 6 7 Ayres, Jeffrey M. (2004-02-26). "Framing Collective Action Against Neoliberalism: The Case of the 'Anti-Globalization' Movement". Journal of World-Systems Research: 11–34. doi: 10.5195/jwsr.2004.311 . ISSN   1076-156X.
  4. ↑ Compa, Lance (2019). "Trump, Trade, and Trabajo: Renegotiating NAFTA's Labor Accord in a Fraught Political Climate". Indiana Journal of Global Legal Studies. 26 (1): 263–304. doi:10.2979/indjglolegstu.26.1.0263. ISSN   1080-0727. JSTOR   10.2979/indjglolegstu.26.1.0263. S2CID   159172516.
  5. ↑ Ayres, Jeffrey M. (2004-02-26). "Framing Collective Action Against Neoliberalism: The Case of the 'Anti-Globalization' Movement". Journal of World-Systems Research: 11–34. doi: 10.5195/jwsr.2004.311 . ISSN   1076-156X.
  6. ↑ Faunce, Thomas Alured (2007), "Reference pricing for pharmaceuticals: is the Australia–United States free trade agreement affecting Australia's pharmaceutical benefits scheme?", Med J Aust, 187 (4): 240–2, doi:10.5694/j.1326-5377.2007.tb01209.x, PMID   17564579, S2CID   578533 .
  7. ↑ Faunce, TA; Neville, W; Anton, Wasson A, "Non Violation Nullification of Benefit Claims: Opportunities and Dilemmas in a Rule-Based WTO Dispute Settlement System", in Bray, M (ed.), Ten Years of WTO Dispute Settlement: Australian Perspectives, Commonwealth of Australia: Office of Trade Negotiations of the Department of Foreign Affairs and Trade, pp. 123–40.
  8. ↑ "Trade footprint". HEC Global Learning Centre. Retrieved 15 February 2017.
  9. ↑ "Justice and International Trade - School of Economic Science". School of Economic Science. Retrieved 2017-02-28.
  10. ↑ Ghosh, Jayati (2013-11-27). "Why farming subsidies still distort advantages and cause food insecurity". The Guardian. ISSN   0261-3077 . Retrieved 2017-02-20.
  11. ↑ Godfrey, Claire (2002). "Stop the Dumping! How EU Agricultural Subsidies Are Damaging Livelihoods in the Developing World". Institute for Agriculture & Trade Policy. Archived from the original on 16 February 2017. Retrieved 16 February 2017.
  12. 1 2 OECD. "Trade and the environment" . Retrieved 2021-10-24.
  13. ↑ Ali, Umar (17 January 2020). "Are mining companies jumping the gun on lithium?". Mining Technology. Retrieved 24 October 2021.
  14. ↑ Kaunda, Rennie B. (19 May 2020). "Potential environmental impacts of lithium mining". Journal of Energy & Natural Resources Law. 38 (3): 237–244. Bibcode:2020JENRL..38..237K. doi:10.1080/02646811.2020.1754596. S2CID   219452489.
  15. 1 2 3 4 Gonzalez, Carmen G. (January 2001). "Beyond Eco-Imperialism: An Environmental Justice Critique of Free Trade". Denver Law Review. 78 (4): 979–1016.
  16. ↑ Commission for Environmental Cooperation (2002). Free Trade and the Environment. Commission for Environmental Cooperation. ISBN   978-2-922305-78-4.
  17. ↑ Sauvage, Jehan (5 December 2014). "The Stringency of Environmental Regulations and Trade in Environmental Goods". OECD. OECD Trade and Environment Working Papers. 2014/03. doi:10.1787/5jxrjn7xsnmq-en – via https://doi.org/10.1787/5jxrjn7xsnmq-en.{{cite journal}}: External link in |via= (help)
  18. ↑ Stone, Jon (14 October 2021). "Don't let environment get in the way of trade deals, government tells its negotiators in leaked document". Independent. Retrieved 18 October 2021.
  19. ↑ Sky News (14 October 2021). "Leaked document shows trade deals are put ahead of climate goals". YouTube. Retrieved 20 October 2021.
  20. ↑ Fridell, Gavin; Ervine, Kate (1 September 2021). "Demanding justice: Can trade policy be fair?". The Monitor. Retrieved 18 October 2021.
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