As the British and the Dutch, East India companies demonstrated with the power of their navy in India, China and Indo-China, brutally colonizing and plundering these lands for centuries in the name of “free trade”. Britain even took the role of a Mafia Drug dealer in China, by forcing opium on the native Chinese, a nation that was reluctant to trade with Britain. The US followed the same policies as its former colonial masters, by imposing its version of “free” trade by force on Korea, Central and South America (Declaration by the Monroe Doctrine, Spanish-American War), Pacific and elsewhere.
“Free” trade has often meant imposing the trade by the barrel of the gun. Unlike the more cunning and deceitful former European colonizers the American culture is relatively more frank and hence the former US president Woodrow Wilson said: “Since trade ignores national boundaries and the manufacturer insists on having the world as a market, the flag of his nation must follow him, and the doors of the nations which are closed against him must be battered down. Concessions obtained by financiers must be safeguarded by ministers of state, even if the sovereignty of unwilling nations be outraged in the process.”
As did William Howard Taft, secretary of war under the presidency of Theodore Roosevelt, who explained that foreign policy "may well be made to include active intervention to secure for our merchandise and our capitalists opportunity for profitable investment."
Successive Presidents and Secretaries of the State have echoed this. Conflicts were not confined between the Colonialist and its colonies, often the Colonialists went to war with each other competing for market shares, the scramble for Africa in the 19th Century by European countries led to many successive wars, as did the struggle over sub-continent, South America and China.
All these skirmishes eventually climaxed with the First World War. Cost of the war led many of the nations to consider negotiating their differences rather then use the military option, this contributed towards the growth of various international political and economical institutions. This was solidified after the Second World War.
At the same time many of the academics argued for the advantages of free trade in generating wealth (theories of trade specialization) for the trading nations and the harmful affects of closing the borders, the economic depression of the 1930s are often highlighted as an example of the consequence of raising the trade barriers.
So nations seeking trade liberalization under the frenzy of Globalization went to the recent WTO meeting held in the Mexican resort of Cancun, seeking to establish a consensus, which could have potentially lead to a multilateral agreement between its 146 members.
The agenda was initiated at the previous meeting at Doha. However, few considered the main stumbling block -- the basic human nature of greed -- rich and the powerful wants to get richer, even it means making the rest of the world poorer. A natural human trait that is not regulated but rather completely let loose within the Capitalist paradigm, it forms one of the basic pillars of the “free market” fundamentalism (Capitalism).
Hence, the debased desires to covet the wealth of other nations, after securing the wealth from within by depriving the majority of its own masses of decent living standards, are enforced by the deployment and careful marketing of fanciful terms like “free” market. Hence we witness the belligerence of the “freedom” fanatic fundamentalists.
Even a cursory glance will tell you that it is “freedom” for and in particular its multinationals, and financiers not the freedom that is universally applicable to all human beings and nations. Never the less the member states hoped that everyone would see the mutual benefit and some form of compromise would be reached on that basis.
The summit was however a failure as nations walked out, unable to reach any agreement. However many viewed it as a turning point, as for the first time the poorer nations put up collective resistance against the three economic giants, US, Europe and Japan, this resistance led some to declare it as a form of victory for the poorer nations. The opposition was primarily provided by the G22 group of countries, which was led by the axis of Brazil and China, other less influential groups like the Least-Developed countries with its 49 members led by Bangladesh, African, Caribbean and Pacific Group (ACP) etc were also there to negotiate their own respective interests.
The most contentious issue was that of Agricultural subsides provided by the wealthy United States and Europe to their farmers, creating a glut in the market, lowering prices, with excess being dumped on the third world market eventually. Such practices are costing the poor countries in terms of millions in the losses of export revenue and may even ruin their own domestic market if subjected to dumping policies of the powerful nations. Another area of contention was that of cotton. Pakistan and south Asia (produces 22% of the world cotton production) along with other African states again its primary victim.
To compound the problem all these poor nations have huge debt servicing burdens to the IMF and World Bank. Far from conceding to the reduction of export subsidies to create a more equitable environment for the poorest countries, allowing them a chance to develop and grow, they went on the offensive asking for the adoption of “Singapore issues” (Originally proposed in Singapore back in 1996). Which would facilitate greater market penetration by the Multinationals and big Corporations. No surprise as they are the real beneficiary behind the scene.
The Singapore issue has four main components -- how countries deal with foreign investment -- standards of anti-monopoly and cartel laws (competition) -- government procurement -- and trade facilitation (WTO jargon for easing red tape, customs and eliminating corruption). Naturally reservation from all the developing and least developed countries, people often forget, free does not necessarily mean fair. Countries with greater expertise, resources are easily able to out maneuver the poorer countries.
Foreign investment can undermine a nation’s fiscal policy (sovereignty) as voiced its opposition. The latter learnt how the currency traders were about to destabilize the entire economy during the Southeast Asian market crash not too long ago. In essence such a formula would prepare the local industries to be controlled by the multinationals and thereby the colonizing the countries effectively. “Free trade” is not so free after all.
It was also an ideal opportunity for the US to convince the world of its current claim of being an ideal benevolent nation by unilaterally reducing its tariffs and subsidies to a reasonable level, which would have had an enormous positive impact on the poor countries. As one Bangladeshi economist remarked in the past that “third world needs trade not aid”. The initial loss of US businesses would have been more then compensated by the over all economic growth and an increase in confidence for investors and consumers. At the stroke of a pen, the US and Europe could have liberated millions out of poverty and desperation. Such conditions have been created through the policies of their financial institutions in the first place.
This perhaps also really proves the point that Capitalist nations are not benevolent nations but rather only self-serving. When they tell you they want to liberate they are simply lying, current and historical evidences are overwhelming, if there has been the odd liberation (e.g. France, Western Europe and the Pacific nations during second the World war) it is only an unintended by-product of a struggle with rival competitor nations for securing (or defending) its own interests.
Solution or Suggestion
As for the poorer nations, they must have the will power to act in a collective manner in opposing the domination, who are only interested in getting richer at all costs and learn from its Colonial history. They must resist the seduction of short-term gains through forming bilateral treaties.
The market shares of world trade for the poorer countries are continuously decreasing and the gap between the rich and the poor nations are ever increasing; the current model is not viable for securing their own interests. Hence the poor nations should collectively look to create an alternative, and perhaps attempt to entice the oil rich Arab countries with long term visions rather then short term pragmatism.
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