WTO hits services

A currently-negotiated international trade agreement threatens to re-open the debate on municipal and public sector service provision in Western Australia.

Due to massive street protests and the concerns raised by developing nations, the Third Ministerial Conference of the World Trade Organisation (WTO) collapsed in Seattle in December 1999.

This thwarted the launch of a broad “Millennium Round” of negotiations to increase global trade and investment liberalisation. A further attempt to commence a new Round will occur in the Middle Eastern country of Qatar in November this year.

Since Seattle, the Secretariat of the WTO has been preparing for negotiations in two areas: agriculture and services. The latter is represented by the General Agreement on Trade in Services, or GATS, which is the current focus of controversy with respect to the trade liberalisation agenda.

GATS was initially established in 1994 when the Uruguay Round of the General Agreement on Tariffs and Trade was completed to form the WTO.

It covers a wide range of services, including public sectors that affect the environment, culture, natural resources, drinking water, health care, education, social security, transportation services, postal delivery and a variety of municipal services.

The present negotiations are attempting to extend the power of GATS to phase out all governmental barriers to international trade and commercial competition in the services sector.

These new proposals include a “necessity test”, whereby governments would need to prove that any of their countries laws and regulations are not more trade restrictive than necessary, regardless of financial, social, technological or other considerations.

Those opposing GATS argue that this will make it more difficult for governments to maintain or create environmental, health, consumer protection and other public interest standards. The new proposals would also enable the Agreement to restrict the use of funds for public works, municipal services and social programs, requiring them to be directly available to overseas-based, private service corporations.

The new GATS would accelerate the process of providing corporate service providers with guaranteed and un-limited access to domestic markets in all sectors – including education, health and water. Health care is considered to be a seven trillion dollar ($AUD) annual market worldwide, with edu-cation targeted as a four trillion and water a two trillion dollar market. The wholesale privatisation and dereg-ulation of these essential services has been the focus of worldwide concern over the past decade, not the least of which in Bolivia last year when hundreds of thousands of Bolivians marched to successfully overturn the privatisation of their water supply.

GATS negotiations are being watched with increasing interest around the world.

Commitments made under GATS are essentially permanent, and have the potential to affect virtually every area of public life.

Yet most public service providers in State and local governments in Western Australia would not have yet heard of this Agreement.

This is no reflection on policy makers in health, education, municipal serv-ices, water and other public sector services.

It signifies the degree to which such important international trade nego-tiations are kept out of the public spotlight. The Multilateral Agreement on Investment, for example, may never have been scuttled by citizen pressure had not a draft been leaked over the Internet.

Nevertheless, the implications of GATS are beginning to surface, as demonstrated by a resolution of the City of Vancouver to urge the Canadian government to exempt local muni-cipalities from GATS regulations.

Western Australian local govern-ments and public sector services are yet to catch on.

The controversies surrounding eco-nomic globalisation and trade liberal-isation will not go away. On April 20, there is expected to be yet another major demonstration concerning these issues, when thousands of people protest against the extension of the North American Free Trade Agree-ment, during the Summit of the Americas in Quebec City.

While these demonstrations can seem a world away from the sunshine and laid-back lifestyle in Perth, the potential of GATS and other international trade agreements to shape life here is of no less concern.