Richard Melson

November 2006

SOUTH Centre Bulletin No. 134

This issue of the South Bulletin focuses on giving primacy to development in economic partnership agreements.

South Bulletin 134

1 November 2006

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In this Issue:

South Centre: President Mkapa Assumes Leadership after Boutros-Ghali

The former President of Tanzania, Mr. Benjamin William Mkapa takes on the mantle of leadership of the South’s think-tank - the South Centre - from Dr. Boutros Boutros-Ghali, the former UN Secretary General. President Mkapa is the fifth Chairman of the Board of the South Centre – an intergovernmental body of 51 developing country members. Venezuela and Liberia are the latest members.

New Global Vision Must for Inclusive Globalisation - Manmohan

In a recent address to the Universtiy of Cambridge, the Prime Minister of India, Dr. Manmohan Singh, appealed to the developed countries not to allow short-term national interests to prevail at the cost of promoting freer trade and combating poverty. "The prosperity of so many cannot be sacrificed for protecting the interests of so few. The price of myopia is heavy on the exchequers of the developed world. The issue also has profound moral dimensions."

The Tshwane Declaration: Deepening India-South Africa Links

The Tshwane Declaration on ‘Reaffirming the Strategic Partnership’ between South Africa and India was signed by the leaders of the two countries on 2 October 2006. In effect, it captures the deepening ties between the two large developing economies from Africa and Asia. It also encapsulates the breadth o exchanges taking place with hopes of expanding them manifold, including on the trade front.

Respecting Development in Economic Partnership Agreements (EPAs)

The development needs and concerns of the 79 ACP countries have not been taken on board by the European Union in their attempts to forge Economic Partnership Agreements (EPAs), says Mr. Mamadou Diop, Minister of Commerce of Senegal. He was addressing a high-level conference on EPA negotiations organised by the South Centre in partnership with a consortium of ACP and European NGOs in Brussels on 12 October, 2006.

The Geopolitics of Latin American Foreign Debt

Foreign debt is essentially a political problem working as a device to make radical changes in the State and in society and which now accommodates its formats and institutional frameworks to the requirements of capitalism. That is the view expressed by Pablo Dávalos, an academic from Ecuador and a former Vice-Minister of Economy.

Other articles:

US: Senior Politicians Investigate Trade Agreements & Health Links

Bilateral Biosafety Bullies

Norway makes ground-breaking decision to cancel illegitimate debt

South Centre News

Many Asian Countries Falling Short of MDG Targets

Scaling up SADC Regional Integration

South Centre: President Mkapa Assumes Leadership after Boutros-Ghali

The former President of Tanzania, Mr. Benjamin William Mkapa takes on the mantle of leadership of the South’s think-tank - the South Centre - from Dr. Boutros Boutros-Ghali, the former UN Secretary General. President Mkapa is the fifth Chairman of the Board of the South Centre – an intergovernmental body of 51 developing country members. Venezuela and Liberia are the latest members. President Mkapa succeeds Dr. Boutros Boutros-Ghali who served a full term of three years. The current members of the Board are Chief Emeka Anyaoku (Nigeria), Cristovam Buarque (Brazil), Norman Girvan (Jamaica), Ma Yuzen (China), Deepak Nayyar (India), José Antonio Ocampo (Colombia), Salim Ahmed Salim (Tanzania). The Convenor of the Council of Representatives is Luis Fernando Jaramillo (Colombia) and the Vice Convenor Mr. Abdul S. Minty (South Africa). The following is the inaugural address by President Mkapa on 16 October, 2006.

"Members of the Board and the Executive Director

Members of the Council of Representatives

Ladies and Gentlemen,

I want to thank you very heartily for your decision to appoint me the Chair of the Board of the South Centre by acclamation. I am overwhelmed and I am grateful that you have adjudged me worthy of this position. I thank all of those who have spoken in appreciation of what I may have contributed to the development of my own country but also to the development of healthier and more cooperative international relations in the member community of nations.

I am very grateful for the words of encouragement that you have extended to me and the assurance that you will give me all the assistance that I shall require in discharging this responsibility.

This decision of yours is a great honour and an enormous privilege to me, for I know I am being asked to walk in the footsteps of great personalities who have assumed this Chair in the South Centre in the last ten years. Having worked under the founder Chairman Julius K. Nyerere and worked with the immediate past Chairman – Dr. Boutros Boutros-Ghali – with him as a Fellow Foreign Minister and with him as the Secretary General of the United Nations, I feel very much at a disadvantage in walking in their footsteps. I just hope that some of the enormous skills and wisdom that they have displayed in their leadership role will, by my association with them, have rubbed some of it on to me.

I say this is an awesome challenge because I am also conscious of the reality of the Centre’s great achievements to date, which have brought different focus in the expectations of very many of our members, according to its potentials and its values. But I am also conscious of the awesomeness of this responsibility because from the little reading and listening that I have done, I know for a fact that the Centre’s foundation is at least delicate, if not secure. Therefore, the work to make its operations firm, sound and productive will be a great financial challenge.

Another reason I consider this position as being an awesome challenge is because over the last three years I have been privileged to serve on a number of international Commissions and panels of so-called Eminent Persons on matters of interest and vital concerns to the international community. First with the fellow Commissioner here – and I am glad to see him – Deepak Nayyar on the Commission on Social Dimensions of Globalisation; subsequently, in the Commission for Africa in which we thought of mobilizing the will of governments but also the sympathy of the international community in the task of eradicating poverty in the African continent. Then I have served on the Panel which was reviewing the work of UNCTAD to see how its role can be strengthened in the immediate future in the light of the anticipated reform of the United Nations institutions and structures. I am now in the process of, with colleagues, concluding the report on the efficiency and coherence of the United Nations and its Institutions and Agencies and their operations in the areas of Development, Humanitarian Assistance and Environment.

In all these undertakings, we have met a great many agency leaders, political leaders, country leaders. We have held consultations with a whole array of civic and non-governmental organizations. One conclusion that I made out of these undertakings was the fact that we have a long way to go to build that bridge between the North and South and between South and South, in order to bring about a more just, equitable, prosperous and peaceful world community of nations. And because of the representations that I have heard, I have also been confirmed in my view that the Centre’s mandate is far from obsolete.

On the contrary, I believe that it is more in need now than it has ever been before. I have sensed a great deal of creeping isolationism. I have sensed a decline in global statesmanship. I have sensed creeping economic protectionism. I have noticed divides on the political landscape. I think all these factors and developments really put into greater relief the role the Centre can play and the role its members can play. I think for this reason, at this time, the Centre is well placed to make not only a remarkable but a marked contribution to the process of evolution of, as I said, a more just, prosperous and a peaceful world. I am confident that we can make that remarkable but marked contribution to this process. Why can’t we when we have such distinguished members of the Board? How can we not make that contribution when we have such talented, skilled and experienced members of the Council?

I am sure that if we bear in mind that this Centre is not the Chairman’s, it is not the Convenor’s, it is not the Executive Director’s or any of the staff – but it is the membership – all of us here. We pool our resources of will, intellect and material resources together and we can make a difference in the evolution of the international community.

Let mew also join you in paying tribute to BBG as I like to call him – my predecessor Dr. Boutros Boutros-Ghali. As I have said to you, I have worked with him over many years in various capacities. I am conscious of the extent to which I learned the knowledge, the skills, the sagacity of mind and the breath of his international exposure. I will try my best to borrow from his record of serving you in this position. I have special regard for the way in which he worked courageously and diligently to give the United Nations its rightful role in the evolution of international development, peace and security – against great odds and very unfair criticism. I will continue to profit from his advice. But that is not the only reason why I wish him a long, long life.

Dr. Bourtros Boutros-Ghali, thank you very much. I shall try to carry on the baton that you have passed on to me this year.

Members of the Council

Thank you once again for your confidence. Together let us make our way on the path of Development and Peace. Thank you."

New Global Vision Must for Inclusive Globalisation – Manmohan

In a recent address to the Universtiy of Cambridge, the Prime Minister of India, Dr. Manmohan Singh, appealed to the developed countries not to allow short-term national interests to prevail at the cost of promoting freer trade and combating poverty. "The prosperity of so many cannot be sacrificed for protecting the interests of so few," he affirmed. "The price of myopia is heavy on the exchequers of the developed world. The issue also has profound moral dimensions." Presented below are extracts from Dr. Singh’s address made on 11 October, 2006.

"I am deeply conscious of the honour that you have bestowed upon me by inviting me to deliver this lecture and by conferring on me the degree of Doctor of Law. I crave your indulgence as I begin on a personal note. I am one of the fortunate few to have been embraced by Britain’s two oldest universities. Before I went to the other place by the Isis, I saw the river Cam when I came up to study for my Economics tripos at St John’s. In the beginning was St. John’s. The colour light blue is one of my favourites and is often seen on my head. My memories of my days in Cambridge are deep. I was taught by teachers like Nicholas Kaldor, Joan Robinson, Maurice Dobb and Professor R.C.O. Mathews. I have vivid recollections of the economist Pierro Srafa working at the Marshall Library. It was here that I became a contemporary of Amartya Sen, Jagdish Bhagwati, Mahbub-ul Haq and Rehman Sobhan - all renowned economists from South Asia who became lifelong friends. My teachers and my peers in Cambridge taught me to be open to argument and to be fearless and lucid in the expression of one’s opinions. These virtues, and a relentless desire to pursue intellectual truth were inculcated in me at Cambridge. In many important ways, the University of Cambridge made me.

I am certainly not the only Indian who is thus indebted to this University. Jawaharlal Nehru was at Trinity as was his grandson, Rajiv Gandhi. Both became Prime Ministers of India. I am thus the third Prime Minister of India to have come out of Cambridge. Sarojini Naidu, known as the `Nightingale of India’, played an extremely significant role in India’s freedom movement and she studied at Girton. Looking beyond the arena of political leadership, there were many eminent Indians, who studied in Cambridge, and then made significant contributions to the world of science and to public life in India. In this context, I think of Jagadish Chandra Bose, who was at Christ’s in the 1880s and was a pioneer in the study of radio waves and the life of plants. I think of Srinivasan Ramanujan, the master of the theory of numbers who was brought to Trinity by G.H.Hardy. I remember P.C. Mahalanobis who was at King’s and then founded the Indian Statistical Institute in Calcutta. Homi J. Bhabha, who played a crucial role in the development of India’s nuclear programme and established the Tata Institute of Fundamental Research in Mumbai was at Gonville and Caius. M.S. Swaminathan, the man who envisioned the Green Revolution in India, was at St. Catharine’s. I mention here only the very eminent but there are many others in the social sciences, in education and the bureaucracy in India who, like me, claim this university as their alma mater. The links between India and Cambridge are long and enduring.


When I came up to Cambridge in the mid 1950s, the Cold War had frozen the world into two blocs. India had won Independence a few years before and under the leadership of Jawaharlal Nehru was trying to establish its own place in a divided world. For Indians it was an era of hope, and there was great optimism about the prospect of development.

Today the world appears radically altered. The Cold War is history. A new age of freedom has harnessed to it new technologies that have transformed production and communication. The dismantling of state control has unshackled economic forces. More countries are now integrated into a global economic system in which trade and capital flow across borders with unprecedented energy. The age of freedom is also the age of economic growth. Prometheus has truly been unbound.

A very significant feature of the global economy is the integration of the emerging economies in world markets. In fact, the weight of global economic activity is gradually shifting to these emerging economies. They now account for more than two-fifths of world exports compared to a fifth twenty-five years ago.

In many parts of the developing world, especially India and China, per capita incomes are doubling or are expected to double over every decade. This will lift millions of people out of poverty. This pace of change is unprecedented, far exceeding what was witnessed during the Industrial Revolution in Europe. Freer trade and financial flows in the world as a whole are helping to contain inflation, keep interest rates low, and sustain higher levels of investment.

In my own country, the economic reforms we initiated in the early 1990s have made our economy more competitive. Indian business is responding to new market opportunities. India’s growth is underpinned by a vibrant and growing entrepreneurial class. Indian youth is keen to get into technical and scientific institutions - helping India gain salience as a knowledge based economy. Our country, I believe, is now on a growth path of 7 to 9 per cent per year, while maintaining price stability. The proportion of people living below the poverty line is declining.

Globalisation: Some Concerns

These achievements of the era of globalization should not blind us to the new anxieties that globalization has brought in its wake. The reach of globalization is yet to touch many parts of the world. Moreover, the evidence suggests that the process has not removed personal and regional income disparities. In many developing countries, growth is by-passing the rural areas. Also, in the face of stagnation in their real pay, the working classes in industrialized countries are becoming fearful of the opening of markets. The gap between the rich and the poor is widening. This, coupled with the inability of the public sector to provide adequate and quality services in health and education, and cater to the needs of the poor, is causing resentment and alienation. This is nurturing divisive forces and putting pressure on the practice of democracy.

These are real and palpable concerns and they cannot be ignored. Ladies and gentlemen, I suggest to you that we address these vital concerns by making globalisation an inclusive process. We need to work for inclusive globalisation. This calls for a new global vision.

Make Globalisation Inclusive

That vision must ensure that the gains from globalization are more widely shared. It is a matter of deep concern that the Doha Development Round of trade negotiations has reached an impasse. If trade is to be an instrument of combating poverty and spreading manufacturing capacities more evenly in the world, it is vital that barriers to the export of agricultural goods from developing countries be eliminated.

Nearly 2/3rd of the population of developing countries live in rural areas. In the developed world this falls to less than ten per cent. My appeal is that developed countries should not allow short-term national interests to prevail at the cost of promoting freer trade and combating poverty. The prosperity of so many cannot be sacrificed for protecting the interests of so few. The price of myopia is heavy on the exchequers of the developed world. The issue also has profound moral dimensions.

To convince people in poor countries about the benefits of globalization we must take a more enlightened view in liberalizing trade in services and labour intensive manufactures, in which developing countries are competitive. I see trade not only as a means to prosperity, but also as peace building. Collectively we need to devise an enlightened approach to negotiations over the reduction of harmful gas emissions, intellectual property rights in the production of life saving drugs, transfer of technologies that help to combat poverty and such issues.

Prosperity, ladies and gentlemen, is not divisible. Neither is global peace possible without the eradication of poverty. As Jawaharlal Nehru said in his address to the Canadian Parliament in 1949:

"There can be no security or real peace if vast numbers of people in various parts of the world live in poverty and misery. Nor can there be a balanced economy for the world as a whole if the underdeveloped parts continue to upset that balance and drag down even the more prosperous nations."

Terrorism and Fundamentalism - From a ‘Clash of Civilisations’ to a ‘Confluence of Civilisations’

The best efforts to eradicate poverty will be defeated if our societies and nations are threatened by the spectre of terrorism and extremism. Open societies like India and Britain are more vulnerable to this threat. The very openness of our societies makes us more vulnerable. Yet we must fight terrorism without losing the openness or the rule of law that guarantees the freedom of the individual.

I believe that terrorism can be defeated only by combating fundamentalism and promoting respect for diversity. Britain, the land of John Stuart Mill and Bertrand Russell, the cradle of common law, liberty and democracy, has a unique role to play in fighting fundamentalism. India too has its own pluralistic traditions and openness to other cultures. The legacy of Mahatma Gandhi and Nehru ordains that we remain committed to combating fundamentalism. We do not believe in a "clash of civilizations". What we believe in is enrichment of the human condition through cultural inclusiveness and a "confluence of civilizations".

Global governance

As democracies we must also stand together in making governance across the world more democratic. As a democracy we aspire to a world in which global institutions are more democratic and more representative of all the peoples of the world. The governance processes of global institutions of today - be they Bretton Woods institutions or the UN Security Council - reflect the realities of the world as it was more than half a century ago.

A more inclusive global process that carries the population of the world with it calls for a reform of these institutions, in which the developing world will have a greater voice. Not to do otherwise is to risk alienation and to render ineffectual the global system. I look to Britain, the Commonwealth and other great nations of the world to join forces in bringing about such a reordered global system.

Ladies and Gentlemen, you may well wonder why I have expressed these thoughts at this forum.

Before the First World War, a young man from Allahabad came up to Trinity via Harrow.

After the Second War, a simple young Indian came to St John’s from an obscure university in Punjab. Cambridge University embraced both. This inclusive character of my alma mater emboldened me to speak to this august gathering about inclusive globalisation. I thank you very sincerely for your patience and your indulgence."

The Tshwane Declaration: Deepening India-South Africa Links

The Tshwane Declaration on ‘Reaffirming the Strategic Partnership’ between South Africa and India was signed by the leaders of the two countries on 2 October 2006. In effect, it captures the deepening ties between the two large developing economies from Africa and Asia. It also encapsulates the breadth o exchanges taking place with hopes of expanding them manifold, including on the trade front. Captains of industry from the two sides were also present to enhance economic ties between the two countries. President Mbeki and Prime Minister Singh reiterated their deep conviction that peace and development are indivisible and that good governance was the best-known way to ensure both. Reproduced below is the Tshwame Declaration signed by the two leaders.

1. In commemorating the centenary of the launch of Satyagraha, and in the spirit of the strategic partnership that was established during the historic visit of South Africa’s first democratically elected President, Nelson R Mandela to India in March 1997 and carried further by the visit to India by President TM Mbeki in October 2003 and the visit to South Africa by President APJ Abdul Kalam in September 2004, South Africa and India reaffirm their commitment to a global order of peace, equality and justice.

2. President Thabo Mbeki and Prime Minister Manmohan Singh paid tribute to the global role played by Mahatma Gandhi through the implementation of the principles of truth, non-violence and self-sacrifice, as enshrined in the philosophy of Satyagraha. Gandhi’s influence was felt throughout the world and inspired numerous leaders and renowned personalities like Martin Luther King, Albert Luthuli, Oliver Tambo, Nelson Mandela and Desmond Tutu. It was the unflinching spirit of Mahatma Gandhi that contributed decisively towards the demise of the British Raj; similarly it inspired the struggle against apartheid, particularly during the Defiance Campaign. Above all, it was the strong message of non-violence contained in Gandhi’s Satyagraha that helped to bring about a peaceful transformation in South Africa and the realisation of truth and reconciliation between the destructive human divisions that had been spawned by apartheid.

3. In sharing the fundamental values espoused by Mahatma Gandhi, President Mbeki and Prime Minister Singh stress their continued and unfaltering belief in the peaceful resolution of disputes and the recognition of the rights of nations to self-determination and freedom.

4. President Mbeki and Prime Minister Singh express their belief that South Africa and India draw their strength and inspiration from the diverse, multi-cultural societies constituting their respective nations; and that the best assurance for continued peace and prosperity lies in the adherence to democratic governance that is rooted in the respect for human dignity and the fundamental rights of all people, as laid down in the Universal Declaration of Human Rights.

5. The two national leaders furthermore reaffirmed their belief in the growing partnership with the signing of the following bilateral agreements/MOUs:

· Co-operation in the Field of Education

· MOU between Spoornet and Railways

They furthermore noted that the following agreements will be signed imminently, once the regulatory procedures have been completed:

· Exemption of Visa Requirements for Holders of Diplomatic and Official Passports

· Programme of Co-operation in Science and Technology.

6. Conscious of the need to make the partnership more result-oriented and of greater direct benefit to the peoples of South Africa and India, President Mbeki and Prime Minister Singh have today decided to intensify co-operation and committed themselves to raise the existing level of friendship and partnership between South Africa and India to even higher levels.

7. Both leaders noted that the political interaction between India and South Africa, marked by an exceptional degree of understanding, mutual trust and confidence, had gathered further momentum and substance. The number of Ministerial visits exchanged had increased significantly since the milestone visit of President Mbeki to India in 2003. They expressed their satisfaction at the continued and steady consolidation of bilateral relations. Besides the deep political bond that was first forged more than a century ago, the partnership now extends to the economic, human resources development, public administration and governance, urban and rural settlement, health, defence, cultural and science and technology fields.

8.1 Recalling that the Red Fort Declaration had recognised that the economies of South Africa and India have certain comparative advantages, complementarities and resources which can be exploited to mutual benefit through trade, investment and transfer of technology, they noted with satisfaction the progress that had taken place in these areas, resulting in more than doubling of the total bilateral trade since 2003 and a significant increase in investments in both directions. They acknowledged, however, that the full potential in this regard was yet to be tapped and reaffirmed their determination to explore these opportunities to their optimal extent, particularly in the following priority sectors: energy, tourism, health, automobiles and auto components, chemicals, dyes, textiles, fertilisers, information technology, small and medium enterprises and infrastructure.

8.2 They urged the private sectors of both countries to gain better awareness of each other’s strengths and to set themselves ambitious targets. It should be possible at least to treble the volume of bilateral trade by 2010. In this context, they welcomed the scheduled third meeting of the India-South Africa CEOs’ Forum in Johannesburg on 2 October 2006, which would contribute towards this goal.

9.1 Recognising the major priority attached to the health sector in both countries, they agreed that the Agreement on Co-operation in Health and Medicine should be implemented expeditiously.

9.2 Further, South African and Indian companies providing health services, including diagnostics and medical care, would be encouraged to work jointly to provide affordable health care to nationals of both countries as well as in third countries.

10. Recalling the important Agreements, which were signed in October 2003 to promote co-operation in the fields of hydrocarbons, electricity and power, they agreed that these should be implemented at the earliest.

11. They noted the progress made in bilateral defence co-operation as reflected in the report of the India-South Africa Defence Committee, which met in June 2006 in Pretoria. They agreed that South Africa and India should work towards closer co-operation in the defence sector, including the possibility of joint research and development. Furthermore, the South African Government expressed appreciation for the training provided by India on UN Peacekeeping and operations of modern submarines.

12.1 Lauding the efforts of the South African Government for promoting broad-based economic and social development through the Accelerated and Shared Growth Initiative of South Africa (ASGISA) and the Joint Priority Skills Acquisition Initiative (JIPSA), Prime Minister Singh reaffirmed that the Indian Government was ready to be a partner in these initiatives and to provide assistance in building up scarce and critical skills identified by the South African Government.

12.2 President Mbeki welcomed the growing co-operation within the framework of the Indian Technical and Economic Cooperation (ITEC) Programme and Prime Minister Singh’s indication that India would increase the number of ITEC slots allocated to South Africa from 55 to 100, with 50 of these slots earmarked specifically for the JIPSA Initiative.

12.3 Noting with satisfaction that the visit of the Deputy President of South Africa to India from 9 to 13 September 2006 had helped identify further avenues through which India could contribute to ASGISA and JIPSA, the two leaders decided that a Programme of Co-operation addressing growth and skills would be drawn up by designated co-ordinators from both sides.

12.4 To identify means of co-operation in capacity building and skills enhancement in the key ICT sector, they requested the Working Group set up under the MOU on Information & Communication Technologies to convene as a matter of priority.

13. They expressed satisfaction at the increasing cultural exchanges between the two countries and decided that the Cultural Exchange Programme, which expires in 2006, would be renewed; and that academic exchanges between the two countries, particularly through University-to-University linkages, would be promoted.

14. President Mbeki and Prime Minister Singh expressed their satisfaction on the opening of the South Africa Tourism office in Mumbai in 2005 and reaffirmed their belief that increased tourism would not only bring commercial benefits to both countries, but also enhance the warm people-to-people relations between South Africa and India. In this context, they welcomed the imminent opening of an office of the International Marketing Council (IMC) of South Africa in Mumbai.

15. In the critically important field of Science and Technology, President Mbeki and Prime Minister Singh agreed that a more extensive and active network between relevant institutions of the two countries would be promoted by the concerned Departments. They noted that President Abdul Kalam had delivered the second Philip Tobias Lecture at the invitation of President Mbeki and had called for greater co-operation between scientists of South Africa and India in meeting the challenges of development, including in partnership in the Pan African e-Network and the World Knowledge Platform.

16. In addressing wider areas beyond the bilateral realm, the two leaders agreed that every effort would be made to conclude the India-Southern African Customs Union (SACU) Preferential Trade Agreement as soon as possible since it would provide a significant incentive to the business communities of the two countries to explore mutually beneficial commercial opportunities and contribute to the growth in bilateral trade.

17. President Mbeki and Prime Minister Singh welcomed the launching of the Southern African Development Community (SADC)-India Forum in the Republic of Namibia on 28 April 2006 to promote technical co-operation between SADC and the Government of India in all fields of economic activity with the empowerment of the people in the SADC region and in India as a key priority.

18. The two leaders agreed that the consolidation of the African Union (AU) held the key to the development of the continent. South Africa welcomed India’s willingness to support the objectives of the New Partnership for Africa’s Development (NEPAD), the AU’s primary programme aimed at consolidating the African agenda.

19. The two leaders expressed satisfaction at the outcome of the first IBSA Summit held in Brasilia on September 12, 2006. They welcomed the emergence of IBSA as an effective instrument for promoting ever-closer co-ordination on global issues between these three influential and diverse democracies of Africa, Asia and South America. Both sides also agreed to intensify consultations and co-operation at multilateral forums such as NAM, Commonwealth, G-77, G-20 and the New Asian-African Strategic Partnership (NAASP) with a view to jointly addressing global challenges.

20. The two leaders shared the view that international economic relations continue to be characterised by inequities and inequalities with large sections of the world yet to reap the benefits of globalisation, which has led to economic crises and instability in several developing countries. The two leaders agreed that to be sustainable and successful, the globalisation process must address, not perpetuate or aggravate the existing inequalities. They, therefore, deeply regretted that the Doha Development Agenda negotiations had been suspended which had pitted the interests of corporate agriculture and large industrial enterprises of the developed countries against those of small and the vulnerable producers that predominate in developing countries. This constituted a grave setback to the development promises of the Round and a serious disappointment for developing countries. Failure to conclude the negotiations in accordance with the mandate will deprive developing countries of fair and equitable conditions for fully realising their comparative advantages across agriculture, industry, and services. Both leaders emphasised that substantial and effective reductions in all forms of trade-distorting domestic support provided by the major subsidisers is an unfinished agenda and must be secured to meet the agreed aim of establishment of a fair and market-oriented trading system in the global agricultural sector.

21.1 Convinced of the vital importance of the role of the United Nations in promoting world peace, stability and development, the two leaders welcomed the creation of the Peacebuilding Commission and the Human Rights Council, as well as the progress made in the areas of UN Secretariat and management reform. The leaders noted the importance of increased focus on development and the alleviation of poverty.

21.2 They reaffirmed the need for a decision regarding the expansion of the Security Council, without which no reform of the United Nations would be complete. They reiterated their conviction that the Security Council must be expanded to include developing countries from Africa, Asia and Latin America in both its permanent and non-permanent categories, so as to reflect contemporary realities and make it more democratic and representative, and resolved to continue to pursue a decision in this regard.

22. The two leaders expressed their deep concern over international terrorism, extremism, trans-border organised crime and illicit trafficking in humans and in arms and drugs. They viewed terrorism as a serious threat to sovereign states, international peace, security and development. They agreed that counter-terrorism efforts by the international community under the auspices of the United Nations should be global, comprehensive and in conformity with international law, human rights and humanitarian law. The ultimate objective is the total eradication of this scourge, so that barbaric attacks, such as the ones carried out on 11 July 2006 in Mumbai and other parts of the world, do not recur. To this end, South Africa and India would continue to work towards the early adoption of a Comprehensive Convention on International Terrorism (CCIT) in the UN General Assembly.

23. President Mbeki and Prime Minister Singh reiterated the unwavering commitment of South Africa and India to the goal of the complete elimination of nuclear weapons in a comprehensive, universal, non-discriminatory and verifiable manner and expressed concern over the lack of progress in the realisation of that goal. They emphasised the necessity to start negotiations on a phased programme for the complete elimination of nuclear weapons with a specified framework of time to eliminate nuclear weapons, to prohibit their development, production, acquisition, testing, stockpiling, transfer, use or threat of use, and to provide for their destruction.

24. They agreed that nuclear energy could play an important role in ensuring safe, sustainable and non-polluting sources of energy to meet the rising global demands of energy, particularly in developing countries. They reaffirmed the inalienable right of all States to the peaceful application of nuclear energy, consistent with their international legal obligations. They agreed to explore approaches to co-operation in the peaceful uses of nuclear energy under appropriate IAEA safeguards. They further agreed that international civilian nuclear co-operation, under appropriate IAEA safeguards, amongst countries committed to nuclear disarmament and non-proliferation objectives could be enhanced through acceptable forward-looking approaches, consistent with their respective national and international obligations.

25. In conclusion, President Mbeki and Prime Minister Singh reiterated their deep conviction that peace and development are indivisible and that good governance was the best-known way to ensure both. They emphasised that under-development could not be addressed in isolation, but that its eradication was a factor of numerous social and environmental influences, including education, health care, basic infrastructure and amenities, capacity building and skills enhancement, political participation at all levels, advancement of indigenous culture and social organisation and access to natural resources, clean water and air for all. They emphasised further that the right to freedom had an important economic dimension, as it embraced not only political freedom but also the freedom to lead a life with dignity, unfettered by domination and discrimination. They noted that the strategic partnership between South Africa and India was guided by the common vision of a global order marked by peace, security and equity. To tackle these multiple challenges, they reaffirmed their commitment to enhance their co-operation bilaterally as well as multilaterally, to build a better, safer and more prosperous world for present and succeeding generations.

Respecting Development in Economic Partnership Agreements (EPAs)

The development needs and concerns of the 79 ACP countries have not been taken on board by the European Union in their attempts to forge Economic Partnership Agreements (EPAs), says Mr. Mamadou Diop, Minister of Commerce of Senegal. He was addressing a high-level conference on EPA negotiations organised by the South Centre in partnership with a consortium of ACP and European NGOs in Brussels on 12 October, 2006. The following is a translated version of extracts from Minister Diop’s address.

"First of all I would like to thank the South Centre for inviting me to take part in this conference. I would be most willing to share my views with you on the development challenges of economic partnership agreements - those agreements that will regulate EU and ACP trade relations.

Let me take this opportunity to thank you, Mr. Tandon on the excellent initiative taken by your Centre. This is a timely conference indeed. We have come to the moment of truth as you have said yourself. Let me sum up our concerns by saying that the Cotonou Agreement and all the expectations triggered by this Cotonou Agreement can be jeopardised and can be emptied of their significance if we are not vigilant.

Pursuant to the Cotonou Agreement, a midway review was scheduled. Time will come to review those agreements in 2006/7. The Parties will examine the progress made in the preparation and negotiations. Time will come to carry out a comprehensive and complete review of the signed Agreement to ensure there are no additional delays. As you know, the EU Commission has been in negotiation since September 2000 on economic partnerships with the six ACP regions. This round of negotiations occurs simultaneously in parallel with the WTO negotiating round and you have heard of the complete stop to WTO negotiations.

I need to remind you that ACP regions have been given there own road maps so to speak, and those road maps, from our region at least, foresee the achievement of objectives as follows.

We were set four different objectives:

1. The first goal pertains to the strengthening of our regional integration process.

2. Then comes the need to grant top priority to poverty alleviation and fostering development.

3. Production sectors have to be also re-invigorated, and

4. To grant access to our markets and to be granted access to foreign markets

But today if we are to take stock of our progress we are forced to admit that our development needs and concerns have not been taken on board as they ought to be by the European Union.

Government Officials, Members of Parliament, Civil Society increasingly agree that the Cotonou Partnership Agreement (CPA) ought to be challenged. We are not the only ones to take on such an approach which relies on different arguments. Let me quote a few those objections. "Obtaining a road map without prior assessment of possible EPA’s impact on our economies is nonsensical and still it is a fact." "Impact studies are indispensable and fundamental." Indeed, and let me quote members of the French Parliament, "These impact studies give guarantee to poor countries, governments and peoples that ‘the cart has not been put before the horse’ and that the road maps fall in line with national needs, concerns and priorities."

You have to first assess the impact before embarking on a policy, before committing yourself. As I said, we should not ‘put the cart before the horse.’ It does make sense, does it? Unfortunately, in spite of the approval of those road maps, no benchmarking or impact assessment was carried out in our countries. No national or regional assessment was completed. No Master plan was devised in order to support those road maps. No precise methodology, no accurate schedule or time line, no scientific evidence was brought to the table before embarking on those road maps.

At the end of the day most of our studies were rejected in Senegal. We rejected two impact assessments because we thought those assessments were very poor and brought about very poor results indeed - all because those impact assessments did not meet our own specifications.

The delay in undertaking impact studies carried out at regional and national level are major weaknesses, especially if you keep in mind that we are only two years away from completing the negotiation process. Those weaknesses and delays have impeded and slowed down our own progress and ACP’s involvement in the actual development of the EPAs.

Modelling EPAs on the lines of Article XXIV of GATT must be able to strengthen regional agreements. But this article is an open door to very different interpretations. It can lead ACP countries away from deciding on their own arrangements regarding free trade and liberalisation of trade and regional agreements.

In the interim period, as provided for by the Cotonou Agreement, the creation of free trade areas leads to increasing costs. This is a very sensitive area for a so called poor country. I do not like the term ‘poor’ country because this wording disregards blatantly the riches and the potential of our countries and this is the wrong approach, the wrong notion and undermines the mind set of the new generation. Our new generations of young people may be led to believe that they are poor, that their country is poor and that it is a fact and only natural - which is a complete nonsense and absolutely not true.

Adjustment costs are significant for ACP countries. ACP countries have to struggle hard to offset their loss of tax revenue, new countries have access to ACP’s market on a duty free basis which adds on to the competitiveness of EU countries’ goods. Let me quote an example of agricultural producer from Senegal. "Our farming industry has been dwindling and has almost disappeared because of those provisions that add to our imbalances of trade."

We need to build our capacity and resort to other social measures - flanking measures - to offset, to compensate for loss of revenues. Unfortunately, the EU negotiators did not commit themselves in a very clear way towards ACP countries. Quite the contrary, they did not provide any suggestions for flanking measures that have to be unfolded as free trade areas are being created. Have another look at the actual text of the Agreement, I think that which has to do with trade is very well worded - with a clear cut time line. But that which has to do with development co-operation remains vague and in a state of limbo and leads to confusion.

Removal of tariffs will have a far reaching impact on our tax revenue. A study commissioned by the World Bank focuses on the potential impact of the removal of tariff barriers. For most African countries, tax revenue accounts for 2% of GDP and the EU provides 40% of import to African countries - so the removal of tariffs would lead to a loss by 7-10% of governmental revenue and those losses can rise even higher as far as 15-20% in the case of some African countries. This would be a real break put on African economies and would lead to more of disequilibrium of our trade balances.

Economic trade imbalances based on the creation of free trade areas would add on to the difficulties of ACP countries and will be too burdensome. ACP and EU meetings that took place last January in Brussels led to the conclusion that little progress had been made as far as development is concerned. In the end, adjustment costs and fiscal losses were still very pending issues. Absolutely no progress was made by negotiators in this respect.

Besides, in spite of the commitments made by both parties in the framework of the Cotonou Agreement we still notice that EU negotiators imposed their agendas upon their counterparts. Well, this is the name of the game at the end of the day but the negotiating strategy of the EU Commission is not in line with the spirit of EPA’s related provisions. I am giving you a very personal view that EPA’s provisions were weakly negotiated by ACP countries. We did not make our point strongly enough and yet, the European Parliament voiced many criticisms towards the EU Commission. The European Parliament has adopted positions that are very close to our own. One has to recognise that without an adequate supply of production capacity, a country can make very little progress because you will have put ‘the cart before the horse’ and you cannot fulfil your commitment.

Unfortunately, the EPAs were matched with previous WTO agreements which have sustained inequities and unfair practices of the past. ACP countries are faced with a budgetary shock because of the loss in tax and tariff revenues. And there is another pending problem, another shock, a trauma triggered on the trade balance. There will be a trauma caused to the cultural web, to the social dimensions of our ACP economies.

Committing to such an economic partnership agreement is committing yourself to a blank cheque and committing your whole population to a blank cheque. My belief is - it is essential that we should further work on African ministerial negotiations and inter-African negotiations. We have to come up with a joint position to defend before the EU Commission. We have to revise and re-think EPAs on the following lines:

1. The first would be a postponement of the 2008 deadline so that the ACP countries can in all objectiveness re-assess the impact of EPAs on their economies. The 2008 deadline falls in line with the Doha’s round deadline but as we all know, the Doha’s cycle is almost at a standstill to this day.

2. To drop the reciprocal trade liberalisation objectives while still asking for preference treatment for ACP countries.

3. Priority should be given to development cooperation instead of the trade dimension of EPAs. We should work and comply with the principals and the spirit of the Cotonou Agreement.

5. Additional resources should be earmarked for environmental protection, boosting competitiveness enhancement and try to re-envigorate economies in the ACP countries.

6. Additional means should be devoted to more development and the eradication of poverty through co-operation support. The necessary commitments must be made so that funds can be earmarked and released to offset preference erosion and removal of tariffs, and

7. Broad-based and inclusive consultation processes should be set up with civil society and grass root level organisations and Members of Parliament.

We need the broadest of possible consultation process that makes the seven areas that will serve as the conclusions to my contribution. Thank you very much for your attention."

The Geopolitics of Latin American Foreign Debt

Foreign debt is essentially a political problem working as a device to make radical changes in the State and in society and which now accommodates its formats and institutional frameworks to the requirements of capitalism. That is the view expressed by Pablo Dávalos, an academic from Ecuador and a former Vice- Minister of Economy. In a recent article in the Znet, he argues that to understand foreign debt as "an agent of political transformation" linking free trade agreements with the demands of corporations, one has to escape from the financial and macroeconomic focus on debt and look at it as basically a political problem. The original source of the article, translated from Spanish by Toni Solo, is

Despite its importance, consideration of foreign debt over the last few years has been diffuse and blurred. Whereas in the 1980s foreign debt was the focus of argument, twenty years later it appears as a marginal issue, as much in discussion of public policy on the development financing of alternatives to the current model as in critical theory.

The relevance of stabilization policies are not even discussed in the region. Argentina and Brazil may have cleared their debt with the IMF but at the same time their governments remain faithful to prescriptions for stabilization. Even ECLAC (1), formerly critical of power and a source of inspiration as much for critical theory as for the adoption of public policies of endogenous growth and income redistribution has now joined the single ideology chorus.

Despite that, the issue of debt in current circumstances may be perhaps even more strategically important than in the 1980s when the debt crisis broke and the programmes of adjustment and stabilization began.

In effect, reflections on debt have prioritized financial and also macroeconomic aspects in relation to development finance, without seeing debt as the trigger for radical changes in the structure of the State and, now, in the negotiations and concessions relating to territorial sovereignty inherent in free trade agreements. In the same way that debt management worked as the master key to disengage projects of industrialization via a regulatory State, now it works through strategic plans like IIRSA (2) and Plan Puebla Panama to give coherence and consistency to free trade agreements linking structural reforms to megaprojects involving intensive exploitation of natural resources and labour.

Operators of neoliberal reforms of the same type and vast, deep reach as the IMF and the World Bank, like the Andean Development Corporation (CAF), Fonplata and the Inter-American Development Bank have disappeared from sight. In fact, in reflections on debt neither the CAF nor Fonplata appear as political agents of neoliberal reform. The case of the reforms to the internal statutes of the CAF incorporating countries like the US and Brazil as class A investors, a fact of vital importance for the region because it implies de facto concession of territoriality and resources to corporations through the presence of the CAF as an IIRSA funder, has gone unnoticed in the theoretical debate. The consequences of the fact that private US banks can now finance the more than 300 IIRSA projects have not been analysed.

Nor has an analytical link been developed between the new process of multilateral indebtedness via the IADB and the CAF and the free trade agreements the US is imposing in the region. A closer look at recent processes shows there is something more than coincidence in the siting of US military bases in the wealthiest areas of biodiversity, along with projects of either IIRSA or Plan Puebla Panama and mulitlateral funding. From that point of view, the separatist declarations of elites in Zulia, Guayaquil or Tarija and Santa Cruz, are more significant and may be related to this new modality of negotiating state sovereignty. All of this without doubt offers a more dense and complicated panorama of the burden of debt payment for any country than merely viewing debt as an accounting aspect of development funding.

And so to understand these new dynamics of foreign indebtedness and consider foreign debt as "an agent of political transformation" linking free trade agreements with the demands of corporations, one has to escape from the financial and macroeconomic focus on debt and look at it as basically a political problem. Foreign debt is essentially a political problem working as a device to make radical changes in the State and in society and which now accommodates its formats and institutional frameworks to the requirements of capitalism.

Once the region has internalized the argument for stabilization as an argument of its own and in which critical voices have been extinguished, to the extreme that the whole of political economy has turned into variations on the theme of stabilization. Once the structural reform of the State has been consolidated and societies have been disciplined thanks to that reform’s transversal axes like the fight against poverty, local participation, anti-corruption drives and decentralization, in such a way that even critical voices end up using the same conceptual schemes as the World Bank, like the dollar a day concept to define poverty. At that point, power needs to move into a deeper phase, namely the dismantling of the territorial sovereignty of States, because sovereignty dictates the use, ownership and management of natural resources.

So then it is necessary to render incoherent the vestiges of sovereignty that States may have over their natural resources and even over their populations. The free trade agreements the US is imposing in the region are meant to break up sovereignty. In effect the free trade agreements - thanks to their single format, which almost by definition blocks any negotiating strategy - break up territorial sovereignty and open up territory for the operation of corporations and financial capital.

The free trade agreements are the terminus of the structural reforms. They are also meant to be points of no return, to be final, absolute strategies. And the mechanism that permits a direct convergence between corporations and financial capital with control, management, operation and ownership of territorial sovereignty and of natural resources is, precisely, foreign debt.

It is from this point of view that I propose a political reading of foreign debt in the region in which one can identify three main processes or stages, complementary one to the other but different in the function of the dynamic that orders them:

a) A financial stage in which world financial architecture is redesigned and in which international corporate finance consolidates and expands as a fundamental actor in financial globalization. This financial stage is typified by the imposition of structural adjustment programmes and macroeconomic stabilization programmes. This began with Mexico’s debt crisis in 1982 and continues to the present. The principal organization in this stage is the IMF and the legitimating theoretical model for the transfers of resources to the capitalist centre is monetarism, whose concrete expression in order to guarantee debt payments and articulate structural adjustment programmes is a monetary focus on the balance of payments. During this stage, debtor countries design public policy around paying the debt and become net exporters of capital. The way these public policies are imposed in the economic field is via Letters of Intent agreed with the IMF.

b) A second stage that began in 1985 during the joint meeting of the World Bank and the IMF in South Korea, is characterized by a series of credits from the World Bank aimed at projects to reform the legal and institutional structure of the State. From the time James Baker in 1985, then US Treasury Secretary, defined the new role of the World Bank in economic adjustment until the publication in 1989 of (John) Williamson’s Washington Consensus a period existed in which conditionalities of the IMF and the World Bank were juxtaposed so as at times to contradict each other as regards the time and speed of the structural reform.

The beginning of the 1990s clarified the roles of the IMF and the World Bank, so the latter focused on structural reform of the State; that is, on carrying out a series of projects whose main aim is to privatize State functions. So this stage can be defined as one of structural reform and institutional reform of the State. The basic axes are privatization, liberalization of markets, labour flexibility, public spending cutbacks and structural changes in the make-up of the State and the definition of public policy. The theoretical framework that legitimizes and offers some rationality to the strategies put forward in this stage consists of political and economic variants on neo-institutionalism.

During this phase, the new indebtedness focuses on programmes and projects of social control and institutional transformation of the State. To give normative and analytical coherence to these changes, the World Bank uses the so called Country Assistance Strategies, equivalent to the IMF’s Letters of Intent. The legitimising discourse is the fight against poverty, and the construction of poverty as an economic phenomenon dependent on economic growth. For its part, growth is conceived by the World Bank as a task and responsibility exclusively of the private sector.

c) A third stage, concomitant with the structural reform of the State, is related to the "strategic plans" that define megaprojects for the intensive exploitation of natural resources and the labour force, as  is the case with Cana Brava in Brazil, Camisea in Peru, or Yacyreta in Argentina and Paraguay, among others (6). These megaprojects have been integrated into two grand initiatives covering the whole of Latin America - Plan Puebla Panama originating in the Tuxtla agreements of 1991 and the South American Regional Infrastructure Integration Initiative created in the presidential summit in Brazil of 2000. This stage incorporates the creation of strategic plans which integrate structural reform policies with the need to extract resources and create a physical base from which multinational corporations can expand their operations and control strategic resources like energy, water and biodiversity.

The stage can be described as strategic from the presence of these megaprojects which privatize natural resources and create vast areas of intensive exploitation. This stage complements new indebtedness with private investment and with the creation of regional markets guaranteed by free trade agreements between various countries in the region and the United States. The key institutions for this stage are the IADB, the CAF and Fonplata. No comprehensive theoretical framework exists in the same way as one did for the previous stages, but rather ad hoc theoretical proposals for new situations within the general epistemological framework of classical liberalism. In that sense, the most important theoretical creation for this new stage are the schemes of payments for environmental services.

So adjustment and structural reform of the State are global processes that define the geopolitics of power and the pre-eminence of financial capital. The strategic plans are regional manoeuvres carried out to ensure the control, domination, ownership and use of strategic natural resources and abundant availability of labour. Both Plan Puebla Panama and IIRSA should be seen within the geostrategic world conflict for control of key areas. The frontier that defines control of strategic resources runs through points of armed conflict, like the area of coltan (7) in the Congo or the war for oil in Iraq (both wars treated in the news media as "civil wars"). And thus the US military bases in the case of Plan Puebla Panama and IIRSA border the areas wealthiest in resources, the Andean Choco, the Guarani aquifers and the Amazon basin.

To guarantee control and access to these areas, the US has tried to form a regional market in which US corporations would have privileged and unrestricted access to these resources with legal security and property rights via the Free Trade Area of the Americas. After the FTAA’s failure the US has carried forward a bilateral strategy of free trade agreements with various countries in the region with the same components as the FTAA. The US has negotiated and in some cases signed free trade agreements with the Central American countries, with Mexico and Canada, with Colombia and Peru, with Chile, and is in the process of negotiations with Uruguay, Paraguay and Ecuador.

So Latin America, as it has been since the Monroe Doctrine of the 19th Century, is the object of hegemonic control by the US which has oscillated between open and covert intervention and direct hostility towards governments that separate from or try to separate from that hegemonic control. Therefore, the region’s economic, political, social and legal phenomena have to be understood within the geopolitical matrix of neocolonialism, interventionism and US domination.

And that means foreign debt has to be understood as a geopolitical phenomenon whereby the adoption of measures in one region necessarily affects the metropolis. If in the 1980s when the debt crisis began Latin American countries with high indebtedness like Mexico, Brazil and Argentina had acted together and established joint negotiating political priorities, the world order would have been significantly changed.

For that reason, one of the concerns of US administrations has been precisely to avoid coordinated, convergent action by Latin American countries on the problem of foreign debt. The US assumed as a priority the task of avoiding the formation of a debtors’ syndicate and as a secondary task to secure and protect its internal financial system by transferring the costs of excess credit and lack of financial regulation to the region’s countries via policies of structural adjustment.

There is a relation between the debt crisis and the expansion of the US economy. Perhaps the most dramatic example is from the 1990s which ECLAC calls the new lost decade while for the US it was, by contrast, the "happy ‘Nineties", to use the phrase of the Nobel economist Joseph Stiglitz. The US had unprecedented growth while Latin America in the same period had serious problems overcoming the economic crisis caused by foreign debt and structural adjustment policies.

Not only that, but also in the measure to which the US transferred the costs of its own crisis to Latin American countries - they used the debt problem as an opportunity permitting them greater geopolitical control in the region. It is by virtue of these circumstances that one ought to consider debt as basically a geopolitical phenomenon. The financial details of the debt, despite their overwhelming importance for the continent’s peoples, are secondary to the neocolonial strategy which is in truth inherent in foreign debt.

Scarcely had the 1982 debt crisis begun than the US reworked world financial arrangements and used the IMF to advance its own interests. During the debt crisis the IMF played a fundamental role, while during the crisis of August 1971, when President Richard Nixon decreed the inconvertibility of gold, it was shown to be powerless to protect the Bretton Woods system. It is the IMF whose macroeconomic stabilization policies have been the master key undoing regional strategies of industrialization and of the welfare State.

Thanks to the IMF the region went from prioritizing employment and growth to controlling inflation as the main aim of political economy. In that way the transition was made from policies of industrialization to policies of stabilization - from the priorities of an industrializing bourgeoisie to the needs of a financial and speculative bourgeoisie. After three decades of stabilization and structural reform and adjustment, the number of households in poverty has risen dramatically and unequal income distribution has become established.

The political crises in the region have corresponded to that adjustment. Social fragmentation and conflict have fed on the dynamics of adjustment and macroeconomic stabilization imposed by the IMF and the World Bank. Stable economies in reality mean under-resourced public spending for health, education and social services, insecure employment, growing unemployment, migration, poverty and inequality. But they also mean huge profits for financial capital and enormous net capital transfers. The adjustment policies of the IMF were a kind of artillery and aerial bombardment on the positions of a State that intervened directly in social regulation and the assignment of resources to promote growth, income distribution and employment creation.

Once those State strategies were disarmed by adjustment and stabilization policies, it was time for the World Bank infantry to come in, who, following the structural reform projects, implacably wrecked the institutional frameworks that one way or another still survived and which proposed a State responsible for distributing income and creating employment via public policy. When it was seen that the task of the World Bank of destroying the welfare State was in its final phase, strategic plans like Plan Puebla Panama and IIRSA came in to occupy the defeated, overthrown territory.

This warlike metaphor is more than just a rhetorical device, if one remembers that the French philospher Michel Foucault may well have been right when he inverted the maxim of Clausewitz. For Foucault, war is not the continuation of politics by others means, but rather the reverse. Politics is the continuation of war because war and violence are the constant norm. In complete contradiction to Kant’s Enlightenment project of perpetual peace, what really exists is a state of permanent war.

The adjustment and structrual reform policies of the IMF and the World Bank and now the strategic plans of the IADB and the CAF are part of this perpetual war. A war whose purpose is conquest, territorial control, domination and pillage, as in any war. One is not exaggerating. Remember that the US after invading and conquering Iraq proposed condoning Iraq’s foreign debt and in fact did forgive a large part of the foreign debt while it militarily occupied the country and took over its oil resources. Iraq’s foreign debt was used as a wartime argument so it is no exaggeration to think that the geopolitics of debt might also be a military strategy.

Once, reading the Lugano Report by Susan George, I thought she may possibly have exaggerated. The world she proposed, in a very interesting exposition, seemed to me too violent to be plausible. But reality always defeats the imagination. Now, I think George came up short. That violence, that cynicism, those designs of violence and domination of the Lugano Report are more than plausible. They are absolutely real.

If Plan Puebla Panama and IIRSA finally get implemented hundreds of indigenous peoples who live in the areas of intervention will have their days numbered. Rural worker families’ days will also be numbered. The tropical forest that still exists will disappear and in their place will be either desert or monocultivation of genetically manipulated crops. The Guarani aquifers will be used up in short order. After timber operations, only vestiges will remain of the Andean Choco. The multi-node corridors will not only devastate nature but also produce more insecurity and more poverty. IIRSA and Plan Puebla Panama are barely the tip of the veil covering the face of the Medusa.

Translator’s notes

1. Economic Commission for Latin America and the Caribbean (

2. South American Regional Infrastructure Integration Initiative (

3. Corporacion Andino de Fomento (

4. FONPLATA - Fondo Financiero para el Desarrollo de la cuenca del Plata (

5. Zulia is an oil rich department of Venezuela adjoining Colombia. Guayaquil is the most important commercial city and port in Ecuador, capital of the Guayas province. Tarija and Santa Cruz are resource rich departments of Bolivia.

6.Caña Brava is a big hydroelectric project in northern Brazil run by the Belgian multinational Tractabel with funding from the IADB. Camisea is a huge gas field which the Peruvian government is developing through concessions to Repsol, the Spanish multinational. Yacyreyta is a large dam project on the river Parana between Argentina and Paraguay.

7.Columbite-tantalite (coltan) is a rare mineral used in high technology like ballistic missiles and space vehicles.

8. Susan George "The Lugano Report : On Preserving Capitalism in the 21st Century" Pluto Press, London, November 2003 (New Edition) ISBN 0 7453 2206 9

US: Senior Politicians Investigate Trade Agreements & Health Links

Pressure is now being put on the US government by two of its senior politicians to clarify how the Administration has balanced commercial drug interests with the health needs of people living in developing countries. What stoked a controversy was a letter from the US government asking the Acting Director General of the World Health Organization to withdraw a study critical of the impact of U.S. trade policy on international health. Entitled "The Use of Flexibilities in TRIPS by Developing Countries: Can They Promote Access to Medicines?" the study was produced jointly by the South Centre and WHO and commissioned by an independent WHO Commission on IP and Public Health. Reproduced below are extracts from the letters by Senator Edward M. Kennedy and Representative Henry A. Waxman to the US Comptroller General on 27 September, 2006, and to Secretary of Health on 13 October, 2006.

To the Secretary of Health and Human Services:

"We are writing with regard to an August 18, 2006, letter from William R. Steiger, HHS Special Assistant for International Affairs, to the Acting Director General of the World Health Organization. In this letter, Mr. Steiger insisted that the World Health Organization withdraw a study critical of the impact of U.S. trade policy on international health.

The report Mr. Steiger found objectionable is titled "The Use of Flexibilities in TRIPS by Developing Countries: Can They Promote Access to Medicines?" Commissioned by WHO, it identified
barriers to public health resulting from the trade policies and free trade negotiations of several developed nations, including the United States.

In his letter, Mr. Steiger demanded that WHO "withdraw" the report and remove its emblem from the publication.  Mr. Steiger stated that he has "raised similar concerns with the WHO Secretariat
in the past about trade agreements," and he requested that the Executive Board of the WHO conduct a full review of WHO’s publication policy.

As a signatory to the Doha Declaration, a trade agreement recognizing the right of member countries to protect public health, the United States is obligated to respect the public health initiatives of other countries.  Yet in the past, we have expressed concerns that the Administration has sought intellectual property provisions in bilateral trade agreements that contradict our obligations under the Doha Declaration.  These concerns have never received a satisfactory response from the Administration, and it seems that the problems raised by the WHO report are being similarly dismissed rather than addressed.

In this era of AIDS epidemics, pandemic flu threats, and drug-resistant tuberculosis outbreaks, we need more not less analysis of the factors affecting global public health.  Attempting to suppress a report because it is critical of U.S. trade policy is unacceptable. Instead, the United States should seriously assess the impact of our trade policies on access to medicines and public health.

We request that you forward to our offices any additional letters or communications sent by Mr. Steiger or other members of the Administration requesting that a World Health Organization publication, official, or representative be recalled for criticizing U.S. policies.  Specifically, we request that these include copies of the past correspondence described by Mr. Steiger and the further correspondence mentioned by Mr. Steiger when he wrote, "I intend to address these specific issues in a subsequent letter to you."

We also ask that you cooperate fully with the Government Accountability Office as it responds to our request last week for an investigation into the effect of the U.S. Trade Representative’s activities on public health.  Specifically, we have asked GAO to assess whether the formal and informal mechanisms of U.S. trade policy conform to the Congressional directive to respect the Doha commitment to public health.

We would appreciate receiving these documents by October 28, 2006. If you have any questions, please let us know, or contact David Bowen at (202) 224-7675."

To the Comptroller General, United States Government Accountability Office:

"We are writing to request a study of the U.S. Trade Representative’s interpretation and implementation of the principle trade objectives relating to intellectual property, as established by Congress in the
Trade Act of 2002.

The Act elaborated three objectives relating to intellectual property: "to further promote adequate and effective protection of intellectual property rights"; "to secure fair, equitable, and nondiscriminatory market access opportunities for United States persons that rely upon intellectual property protection"; and "to respect the Declaration on the TRIPS Agreement and Public Health, adopted by the World Trade Organization at the Fourth Ministerial Conference at Doha, Qatar on November 14, 2001."

Taken together, these three objectives identify priorities and articulate a clear vision for trade negotiations related to intellectual property.  By Congressional mandate, the Administration
has an obligation to advance this vision through its formal and informal trade promotion activities.  We are interested in how these objectives have been interpreted, pursued, and implemented by the
Administration since Trade Promotion Authority was granted by Congress in 2002.

In particular, we would like to learn to what extent the third objective, to respect the Doha Declaration on TRIPS and Public Health, has been pursued.  In relevant part, the Doha Declaration states that no country should be prevented from exercising its rights to protect public health and promote access to medicines for all.

Subsequent elaborations, in 2003 and 2006, have specified mechanisms intended to facilitate such access to medicines.  We are interested in understanding how the rights and priorities identified by the Doha objective have been incorporated into trade-related policies, agreements, and practices of the Administration. In your study, please consider the following questions:

• Has the U.S.T.R., through trade agreement provisions, negotiations, preference programs, trade-capacity building, and other efforts, pursued objectives and principles established under the Doha
Declaration and TRIPS Agreement?  Have these efforts been successful?

• How has the U.S.T.R. balanced efforts to pursue the Doha objective with the two other intellectual property negotiating objectives outlined by Congress in 2002? How many, if any, provisions negotiated
since 2002 expand the Doha protections for access to medicines? How many, if any, provisions of such agreements narrow these protections?  What has been the relative impact of each set of provisions?

• If any instruction included in the Trade Act of 2002 has been found to be in conflict with the Doha objective in practice, how has the Administration acted?

• How has the U.S.T.R. promoted the obligations of developed countries as articulated in the Doha Declaration?  For example, the Doha Declaration reaffirms "the commitment of developed-country
members to provide incentives to their enterprises and institutions to promote and encourage technology transfer to least-developed country members."  Has the U.S.T.R. facilitated such transfer through or in connection with bilateral trade agreements or other mechanisms?

• Have demands of the U.S.T.R., through bilateral trade agreements and other mechanisms, expanded or limited the rights of developing countries as articulated in the Doha Declaration?  For example:

• Has the U.S.T.R. expanded or constrained developing countries’ freedom to independently interpret the TRIPS Agreement according to the Agreement’s objectives and principles under Articles 7 and 8?

• Have the U.S.T.R.’s activities affected developing nations’ use of compulsory licensing, Bolar provisions, and other provisions endorsed by the World Trade Organization for the protection of public health and the promotion of access to life-saving medicines?

• Which government agencies and private sector groups provide input into and exert influence over the U.S.T.R.’s policies and activities related to intellectual property rights?  How does the U.S.T.R. balance and incorporate the concerns of these agencies and private sector groups in its policies and activities, and how have such concerns, once incorporated, affected pursuit of the Doha objective?

• As GAO found in 2002, the U.S.T.R.’s Industry Trade Advisory Committee system has consistently failed to incorporate adequate input from global public health interests.  To what extent has this failure been addressed, and has the failure affected implementation of the Doha objective?  Does the U.S.T.R. use other mechanisms to assure that input is incorporated from groups advocating the rights and obligations established under the Doha Declaration?

• Has the U.S.T.R. used mechanisms outside formal trade agreements to pursue, implement, and monitor the negotiating objectives related to intellectual property rights, and the Doha objective in particular? Please consider the General System of Preferences, the Special 301 process, trade capacity building activities, the Industry Trade Advisory Committee system, side letters, accessions, and diplomacy. For example:

• Have provisions in "public health side letters" achieved or failed to achieve the Doha policy goal of facilitating access to affordable medicines, including the Doha right to implement compulsory licensing?  In practice, have the authorities articulated in these side letters been invoked?  If so, to what effect?

• How has advice offered through trade capacity building balanced protection of intellectual property rights with preservation of developing countries rights under the Doha Declaration?

We look forward to your response to this request.  If you have any questions, please contact David Bowen of Senator Kennedy’s staff at (202) 224-7675 or Naomi Seiler of Representative axman’s staff at (202) 225-5420.

With great respect and appreciation, and we look forward to the study."

Bilateral Biosafety Bullies

Through bilateral trade deals and the oversight structures they create, corporations get direct, behind-the-scenes access to foreign governments, backed by the political clout of their home country’s flag. That is the finding of a new study by GRAIN and the African Centre for Biosafety. The resulting arrangements inevitably serve two basic needs of the corporations: strengthened ownership over assets (through intellectual property and investors’ rights) and regulatory standards tailored to their interests (through health and safety norms). This briefing, presented below, looks at how and why corporations are relying increasingly on the bilateral trade arena to shape worldwide regulatory policy-making over GM food and feed.

The agribusiness sector has been struggling to respond to worldwide opposition to genetically modified (GM) foods ever since farmers started sowing the laboratory-engineered seeds in the mid-1990s. Transnational corporations want weak and predictable international standards that do not restrict trade in their products. But social resistance to GM food is throwing up all kinds of complications. From the mushrooming of local "GM-free zones" and consumer boycotts of GM foods to national and even local GM labelling legislation, the regulatory landscape for agricultural biotechnology is in constant flux, with direct consequences for corporate bottom lines. The situation is particularly problematic for the small cartel that controls the global grain trade. Yet, rather than let go of GM crops in the face of such resistance, they are aggressively sabotaging any process through which governments might autonomously regulate GM food or feed trade. They are doing this together with the GM seed and pesticide companies, applying pressure wherever they can – in multilateral fora and, increasingly, through bilateral channels.

The growing use of bilateral spaces as a means to exert policy pressure is not unique to agricultural biotechnology. It is happening in all sectors, especially through the explosive rise in free trade agreements (FTAs), which are filling the vacuum left by the breakdown in global trade talks at the World Trade Organisation (WTO).

The puppet masters

Just a handful of corporations control global trade in the world’s major agricultural crops. Three companies – Cargill (US), Archer Daniels Midland (US) and Louis Dreyfus ( France) – control over 80% of the global grain trade. The concentration is particularly pronounced among the three GM crops that are traded internationally: maize, soybean and oilseed rape. World trade in soybeans, for example, is dominated by just four companies: Bunge, Cargill, ADM and Dreyfus.[1] When people think of GM foods they often think Monsanto, the seeds and pesticides producer. But the grain traders, who buy and sell the harvested crops, are also involved and actually wield much more influence.

Over the past few decades, the grain merchants have ruthlessly pushed an agenda of market liberalisation and expansion through the multilateral trade and finance institutions. Their parallel objectives are to secure a giant global market, free of barriers to the movement of their products, and favourable production conditions from national and local governments – access to subsidies, enforcement of intellectual property rights, enhanced public infrastructure, lax environmental and labour regulations, etc. The downward harmonisation of health and safety standards is a key component as well because, in order to maximise their profits, corporations need to be able to ship any product anywhere in the world without having to worry about differing requirements when it comes to things like labelling.

The commercial release of GM crops in the mid-1990s was an immediate boost to the big grain and oilseed businesses. GM crops facilitate the expansion of export agriculture. This is especially true of the so-called "first generation" GM crops, engineered for pest and herbicide resistance, as they simplify crop management under monoculture conditions. In the Southern Cone of Latin America, for instance, the introduction of Monsanto’s herbicide resistant GM soybeans has enabled large landholders to convert vast tracts of the Argentine pampas and Brazilian rainforest to no-till industrial monoculture production. Soybean exports from the region took off, literally doubling world trade in soybeans and soybean products between 1995 and 2005.[2] The grain and oilseed corporations are also slowly but steadily moving directly into the development of GM products themselves, most often through joint ventures with GM seed companies, that will lower their costs and enhance their control over emerging markets, such as specialised animal feeds, low transfat crops and biofuels.

However, along with the big advantages that GM crops bring to the global grain merchants, there is also a downside. The widespread rejection of GM food and agriculture has led both to the creation of segregated markets for "GM-free" foods and to the enactment of laws governing trade in GM products. This has brought chaos and unpredictability – two of the things that corporations abhor most – into global food commodity chains. GM crops have thus disrupted corporate plans for uniform and unfettered global markets based on international standards tailored to their needs.

The easy solution to this mess would of course be for the grain and oilseed traders to withdraw their support for GM crops. They dwarf their counterparts in the biotech supply industry and their power is such that they could end the production of GM crops overnight if they simply refused to handle them. But, for these corporations, the long-term payoff from GM crops, which promises greater worldwide integrated production for export, overshadows the downside. So the crop traders are instead linking hands with their counterparts in the agricultural input industry – led by Monsanto, Syngenta, DuPont and Bayer – and putting all their weight into finding another solution that will keep global trade flows open to GM products.

WTO versus CBD: which safety standards?

The strategy of the grain and oilseed traders and the biotech industry, which together form the GM lobby, first became visible at the World Trade Organisation (WTO) with the enactment of the Sanitary and Phytosanitary (SPS) Agreement, which came into force in January 1995. Under it, governments cannot restrict the handling, transport and packaging of GM foods with regard to safety or health unless they have a sufficient ‘scientific basis’ for this step.[3] This is because the SPS Agreement is founded on the US-pushed principle that any GM product should be regarded as ‘substantially equivalent’ to its non-GM counterpart unless proven otherwise. Social, cultural or economic considerations – which much of the global opposition to GM crops is rooted in – are deemed unscientific and therefore banned from playing a role in setting health or safety standards. This framework puts the industry in complete control because the corporations have at their disposal both the scientists to define in an extremely biased and narrow fashion the ‘scientific basis’ that alone may justify any restriction on GM trade, and the public relations machinery to communicate and publicise their findings. Moreover, the SPS Agreement is subject to the WTO’s overall rules on dispute resolution, which can be extremely harmful to a nation. For instance, if a WTO member adopts GM food labelling legislation that is deemed weak on ‘scientific basis’, it could wind up facing crippling duties on its textile exports. The mere threat of trade sanctions through the WTO has caused Sri Lanka, Bolivia, Croatia, and, most recently, India, to back down from enforcing GM labelling regulations.[4] The European Union’s restrictive GM crop standards were also challenged as ‘non-scientific’ by the US; the US won but the EU is unlikely to suffer much since Brussels, unlike many developing countries, is skilful at skirting trade sanctions

While the WTO has its SPS Agreement, the Convention on Biological Diversity has a Biosafety Protocol (BSP). The BSP, adopted in Cartagena in January 2000, governs the international movement of GMOs for food and feed with a view to protecting biodiversity. Although the Protocol has major underlying weaknesses (see, it does have an important strength : in contrast to the SPS Agreement’s operating principle of "substantial equivalence", the Biosafety Protocol’s baseline rule is the "precautionary principle". This means that if the potential consequences of the introduction of a GMO are severe or irreversible, in the absence of full scientific certainty, the burden of proof falls on the proponent. The two agreements are thus ideologically and diametrically opposed. While the SPS Agreement is ideal for the GM lobby, the Protocol contains all kinds of pitfalls.

The GM lobby has done everything it can to undermine the Biosafety Protocol and ensure that the WTO SPS Agreement becomes the main point of reference for international trade in GMOs. It is in this context that bilateral trade agreements outside the WTO have gained importance, with the GM lobby working ferociously, alongside other corporations, to get exactly what they want from them and to turn them into a critical part of their strategy. They have been successful, because practically all of these deals reinforce the supremacy of the WTO SPS Agreement to the detriment of the Biosafety Protocol.[13] The lobby got a big boost in March 2006 when the parties to the BSP agreed that countries not Parties to the Protocol, such as the world’s three major GM exporters (US, Canada, Argentina), shall be exempt from the Protocol’s documentation requirements on trade in GM products when they have made separate bilateral or regional arrangements (see Box in next page). With this concession, the door is now open for an onslaught of bilateral pressures to make any restrictions on GM trade illegal. If this happens, as is likely, the Biosafety Protocol will be rendered completely ineffective.

Bilateral bullying in action

On 7 April 2006, India’s Minister of Commerce Kamal Nath set off alarm bells in the boardrooms of the transnational grain and oilseed merchants. In a supplement to the country’s Foreign Trade Act, the Minister issued rules requiring importers to declare, certify and obtain approval for the import of any products containing GMOs. This was only the reaffirmation of a law on the books since 1989, which had never really bothered the industry because, as one representative from Cargill put it, ‘There was no one to stop the import at the point of entry’.[14] Now it looked as if the Indian government might be getting serious.[15]

This was a cause for real alarm. Over the last ten years India has grown from importing no soybean oil at all to becoming the world’s second largest market. The big soybean oil traders, such as Cargill, which had the most at stake, leapt into action. The soybean industry immediately warned that the new law would halt imports and lead to domestic oil shortages, even as others pointed out that alternatives, such as mustard and palm oils, were readily available and that Indian exports of non-GM soy were at record levels.[16]

It did not take long for the soybean traders to get their way. Their first victory was a reprieve from the Genetic Engineering Approval Committee (GEAC) on 2 May 2006, giving them the right to import GM soybean oil on an interim basis as long as they presented country of origin certification and testing data to the relevant authorities. Then, on 8 May, the Director General of Foreign Trade suspended implementation of the supplement until 7 July, on the grounds that he needed to give importers time to adjust to the requirements. Two weeks later, the Ministry of Environment and Forests let the soybean oil importers off the hook for GEAC approval by issuing a notification limiting the GEAC to the ‘regulation of organisms or products where the end product is a living modified organism’. This was followed by another extension from the Director General of Foreign Trade allowing shipments bearing issued bills of landing on or before 6 July to dock at Indian ports without the necessary documentation beyond the 7 July deadline. And then finally on 21 July, the Director General of Foreign Trade essentially killed the supplement by suspending its application until March 2007, pending review. No reasons were given for the suspension.[17]

The soy traders would probably never have achieved this dramatic policy U-turn had they not had the heavy hand of the world’s most powerful government working in their interest. The supplement was issued just after the US and India had finalised a number of bilateral trade talks aimed at protecting US corporations from non-tariff trade barriers, such as restrictions on GM imports and other SPS measures.

One of the most important outcomes of these talks was the setting up, in July 2005, of the US–India Trade Policy Forum with the goal of doubling trade flows within three years. The US put India’s new GM regulations squarely on the table in the lead-up to the Forum’s third ministerial-level meeting in Washington on 22 June 2006. At a pre-ministerial meeting of the Forum’s Focus Group on Agriculture in New Delhi on 30 May 2006, the two sides "discussed in detail the SPS conditions on ... trade in biotech products with specific reference to the notifications issued by the Ministries of Commerce and Health."[18] A week later, to drive its message home, the US officially raised concerns about India’s GM regulations during a meeting of the WTO’s Committee on Technical Barriers to Trade. The US warned that it would also raise the issue with the WTO’s SPS Committee and requested that India "suspend indefinitely the implementation of these measures … in order to avoid potential trade disruption." The Indian government responded by pointing out that they had already explained to the US in the bilateral talks that this was simply a new notification of an existing measure. But they then added that, through bilateral talks with the US, they had agreed to suspend implementation of the regulation until 7 July and would continue to address US concerns bilaterally.[19]

The following week, during a pre-ministerial press conference, Karan Bhatia, the Deputy US Trade Representative, told journalists that the US government was working through the Forum to change India’s new GM laws.

"I think what I can tell you in that area is that these are bio-tech regs that we’re well aware of. We have got these under discussion with the Indians. I don’t have anything to share for you in the way of outcomes but I would say that bio-tech is a significant area of conversation that we’ve got with the Indians undergoing through the Trade Policy Forum," said Bhatia. "We have been engaged in, I’d say, discussions with them as to whether the bio-tech regulations are going to serve their intended purposes and whether they could usefully be modified, let’s put it that way."[20]

India is not the only country to change its GM regulations after "discussions" with the US government and its corporations. In 2004 China caved in to US pressure and dropped its restrictions on GM soybeans, giving the US a "political commitment" not to disrupt future soybean shipments.[21] Thailand, too, backed down from strict GM labelling legislation in 2004 when the US warned that the legislation would affect their free trade agreement (FTA) negotiations. But the US is not the only country pursuing bilateral pressures; the use of bilateral trade instruments to serve corporations and prise open markets for GM crops is escalating throughout the world.

Bilateral bulldozers

The push to regulate – or rather, prevent the regulation of – GM food through bilateral instruments is not happening in isolation. It is part of a much larger trend in international relations. With global trade talks going nowhere, and geopolitics tightly entwined with business opportunities (or losses), the US and other powerful countries have been quietly hammering out bilateral free trade and investment deals that achieve what they and their transnational corporations have not been able to secure at the multilateral level.

There are now over 2,200 bilateral investment treaties in force and the number of bilateral free trade agreements (FTAs) is rising by the month. Agricultural trade, including GM crops, is a big issue within these FTAs. The GM lobby has been bringing its agenda into these deals and, indeed, it is starting to move faster and harder in this direction.[22]

At the beginning of the process corporations work with their home country governments to identify precise negotiating objectives. The GM lobby is no stranger to such a strategy, for the Biotechnology Industry Organization (BIO) has for some time been actively lobbying the Office of the US Trade Representative (USTR) on bilateral trade agreements. In comments submitted to the USTR on the US–Korea FTA negotiations, BIO called on the US to seek the removal of certain aspects of Korea’s draft regulations for the implementation of the Biosafety Protocol and to challenge Korea’s labelling laws on GM as being inconsistent with the WTO’s SPS Agreement.[23] BIO submitted similar demands for the US FTA talks with Malaysia. More detailed biosafety policy goals for the US–Malaysia deal were put forward by the US Chamber of Commerce and AMCHAM Malaysia (The American Malaysian Chamber of Commerce), which called on US negotiators to secure a commitment from Malaysia to accept the "mutual recognition" of GMOs approved in other countries or in international testing organisations. Citing concerns with positions taken by Malaysia’s Ministry of the Environment, the US business community is pushing Washington to make sure that the FTA will "clarify the roles and responsibilities for biotechnology policy within the Malaysian government, gain consistency in Malaysia’s international biotechnology trade positions, and confirm the Malaysian Biotechnology Corporation as the government’s lead agency for biotechnology policy."[24]

BIO also insisted on clarification of ministerial responsibility as a condition for US approval of China’s accession to the WTO. It described China’s prior notice system as "burdensome" and argued that " China needs to have an event-based approvals process, rather than a commodity-based one, to create a timely and science-based approval process." In the bilateral negotiations on Russia’s accession to the WTO, BIO asked the US to get commitments from Russia to "approve several outstanding applications for agricultural biotechnology products" and to remove the City of Moscow’s ban on GM products in schools. According to BIO: "Past experience has shown that the time to resolve these matters is before negotiations are concluded."[25]

Washington is all ears to the GM lobby as it negotiates FTAs. The US President is actually required by Congress to consult corporate groups as part of his "fast track" negotiation authority. But the umbilical cord goes down to the level of specific firms. As David Spooner of the US Commerce Department put it when he visited Monsanto headquarters in May 2006, "We’re very able to advocate for individual companies, or industries, with foreign governments."[26]

The irony in the case of BIO, however, is that while it is supposed to articulate US negotiating goals for a given bilateral trade deal, its membership is composed of biotech corporations in 33 countries. These include Malaysia, Russia and Korea, with whom the US is currently negotiating trade agreements. So when BIO lobbies the US government on the US–Malaysia FTA, is its Malaysian member speaking or just the US companies? (Its member from Malaysia is the Malaysian Biotechnology Corporation, owned and operated by the Malaysian government!) These crosscutting links, in fact, make the whole process somewhat farcical.

So what does all this add up to? Bilateral trade agreements typically have an individual chapter on SPS matters. Under US FTAs, both sides are expected to profess allegiance to the WTO’s SPS provisions – a commitment not to regulate GM without a sound "scientific basis" (which in Washington’s view can never exist). But an increasing number of FTAs take things further and set up joint SPS committees where biosafety concerns can be raised and dealt with on an institutionalised bilateral basis. The committees generally do not have dispute settlement powers; these are left to the WTO. However, they do bring US trade policy hawks and corporations directly into foreign countries’ SPS decision-making circles, thereby ensuring that US market concerns are taken into account in determining domestic safety regulations. For example, they allow the exporting party to challenge the importing party’s risk assessment procedures based on their own ‘scientific evidence’.[27] They also lock the two countries into an on-going cooperation in which policy-makers from the two capitals are expected to agree on common positions in relevant international processes, such as CODEX Alimentarius, the WTO or the Biosafety Protocol.

US corporations are well aware of the benefits that these committees can provide. The Californian Farm Bureau Federation made a specific request to the US government to form an SPS Committee as part of the FTA with Australia. It argued that, "While technical regulators and scientists would of course be active participants, a policy level committee would help ensure that the technical and policy priorities are consistent and compatible." The FTA had an immediate impact on Australia’s SPS regulations for pork. Upon completion of the FTA, the Australian authorities announced a highly controversial "resolution of technical issues" that had previously kept US pork imports out of the market because of concerns about the transmissibility of several major swine diseases. [28] Australia is now one of the top destinations for US pork.

As part of the FTA, " Australia must give US representatives the same rights as Australians to participate in the development of Australia’s standards and technical regulations," say Patricia Ranald and Louise Southalan of the Australia Fair Trade and Investment Network. "The AUSFTA even states that the Australian government will recommend that Australian non-governmental bodies should also let US government representatives have the same rights as Australian citizens to participate in Australian NGO processes for developing standards for Australia (Article 8.7)."[29]

According to Inti Montenegro de Wit, of the Quechua Aymara Association for Nature and Sustainable Development (ANDES), the US–Peru FTA process was instrumental in shaping Lima’s recent law on biotechnology. "By synchronizing Peru’s sanitary and fitosanitary regulatory measures with those in the US," the FTA has opened the doors to the "deregulation" of GMOs in Peru.[30]

 SPS committees were established under US FTAs with Morocco, Chile, Peru and Colombia. The Canada–Costa Rica FTA has one too. The Australia and Thailand FTA has an SPS and Food Standards Expert Group with the added possibility of forwarding unresolved matters to an FTA Joint Commission for resolution.

SPS is also increasingly present in the EU’s bilateral trade agenda, even though the EU is known for being cautious about GM foods. The EU’s 1995 FTA with Mexico established a Special Committee on SPS as did the EU’s 2002 FTA with Chile. The latest draft of the EU’s FTA with East and Southern Africa commits the parties to "endeavour to harmonize their standards" in accordance with the WTO SPS Agreement and to "develop a joint mechanism for coordination, consultations and exchange of information as regards notification and application of SPS measures; including the establishment of an ESA–EU SPS Sub-Committee, which shall be responsible for reviewing, prioritizing and ensuring that the programmes resulting from this Agreement are effectively implemented." Similarly, the EU’s draft FTA with the Pacific countries devotes a full article to biosafety capacity-building to "ensure that the biosecurity legislation and practices of the Pacific Parties are consistent with the [WTO’s SPS Agreement]."

The meaning of it all?

It is clear that the GM lobby would never put all its eggs into one basket. Corporations, like governments, do not play only one card to get what they want. So it is with their efforts to keep regulations on worldwide trade in GM seeds, food and animal feed as light as possible. The WTO SPS Agreement provides a basic "hands off" policy line that the US in particular but also the EU, Canada and others active on the bilateral FTA front are clearly committed to. The Biosafety Protocol, which allows more interventionist rules, is a problem for the biotech industry so, as we have seen, it has been skilfully weakened by new provisions that allow parties to ignore it if they have signed a bilateral agreement on the same matter.

This does not mean that all biosafety policymaking will now shift to bilaterals. The corporations and the GM exporting governments will always use as many tools and fora as they can simultaneously. But with nothing happening at the WTO and the CBD protocol now stripped of its independence, bilateral trade agreements are clearly going to become much more important avenues for industrialised countries to keep biosafety regulations in developing countries down to a minimum. This is clear so far within the North–South FTAs. How it will play out in the rising number of South–South FTAs, including regional integration instruments, is another matter.

The entry of GM food and farming has been a fundamental concern among people’s movements trying to keep FTAs out of their countries, whether you look at Thailand, Korea, Ecuador, Costa Rica, Honduras or southern Africa. Where they have been signed, FTAs with the United States in particular work as Trojan horses not only to impose patents on life but also to override national rules on the testing, field release and labelling of GM crops and food. They can thus quickly undermine successes that people have achieved in forcing their governments to keep GM crops and foods out of their countries. With the Biosafety Protocol now pretty much rudderless in the rising tide of bilateral deal-making, it is clear that much more work has to be done to support social movements in their broad-based struggles against FTAs.


[1] Bill Vorley, "Food Inc.: Corporate concentration from farm to consumer", UK Food Group, October 2003:

[2] US Department of Agriculture – Economic Research Service, "Agriculture baseline projections: Global agricultural trade, 2006–15":

[3] For a more detailed discussion see Aziz Choudry, "Bilateral Free Trade and Investment Agreements and the US Corporate Biotech Agenda," PAN AP and PCFS, February 2006, p.2:

[4] Witoon Lianchamroon, "As the TNCs Catch You: An Analysis of the liberalization of biotechnological products in the Thai-US FTA," 11 Jul 2005:

[5] See further, International Grain Trade Coalition (IGTC)

[6] News about Testing, Segregation and Identity Preservation from the mouths of seed companies, grain traders and others Compiled by Third World Network, with the help of Greenpeace and Ecoropa Distributed at MOP3, Curitiba, March 2005

[7] Dennis, Stephens. Canadian Grains Council The Biosafety Protocol: Documentation and International Trade Cartagena Protocol on Biosafety: From Negotiation to Implementation Historical and New Perspectives as the World marks the Entry-into-force of the Protocol CBD News Special Edition (undated) but before COP-MOP.1 23-27 February 2004, held in Kuala Lampur, Malaysia.

[8] The North American Free Trade Agreement Commission for Environment Cooperation (NAFTA CEC) recommendations versus the US–Canada–Mexico trilateral agreements: implication for the implementation of Article 18 of the Biosafety Protocol, Greenpeace

[9] See for example, IGTC, "Notice to Trade: Documentation Requirments for Shipments of LMOs for Food, Feed, and Processing effective September 2003," See also Greenpeace’s critique of the trilateral agreement between the, US, Canada and Mexico in United States’ assault on multilateralism continues: The Case of Model Agreements Pushed by Miami + Group The full text of the NAFTA biosafety arrangement is available at

[10] IGTC, "Notice to Trade #3":

[11] For a detailed analysis of the agreement, see Lim Li Lin and Lim Li Ching, Analysis of the MOP 3 Article 18.2(a) Decision, Third World Network, South–North Development (SUNS) Number 5992, March 2006 and Cartagena Protocol on Biosafety-3 rd Meeting of the Parties (MOP-3) T&E Info Exchange

[12] IGTC, "Notice to Trade #7’, 17 July 2006:

[13] Another important bilateral path through which the GM lobby inserts its agenda is through international aid. See GRAIN, "USAID: Making the world safe for GM crops," April 2005 Briefing:

[14] Decisions taken in the 66th Meeting of the Genetic Engineering Approval Committee held on 2 May 2006.

[15] The 2006 Foreign Trade Policy Supplement is available at:; the 1989 Rules on Genetically Modified Organisms is available at:

[16] Rajesh Agrawal, chairman of the Soybean Processors’ Association of India, told Reuters that exports of soymeal were expected to double to 3.7 million tonnes in the year ending September 2006, fuelled by non-GM markets in other Asian countries (Hari Ramachandran, "Indian soymeal exports jump on strong demand," 19 June 2006:

[17] ICTSD, "Indian gov’t tries to clarify GM import rules, backtracks," ; "India to ease controls on gene-modified oils," Reuters, 26 May 2006:; Ministry of Environment and Forests, India, "GEAC approves proposals," 25 May 2006:; "India suspends rule on GM imports until end-March," Reuters, 21 July 2006; "GM soyoil imports exempted from GEAC nod," Financial Express, 25 July 2006;


[19] World Trade Organisation, Committee on Technical Barriers to Trade, Minutes of the Meeting of 7–9 June 2006 (G/TBT/M/39, 31 July 2006): For more detailed information and analysis, see Forum for Biotechnology & Food Security, New Delhi, "GM ALERT: US Using WTO to Push GM Food into India", available at

[20] Ambassador Karan Bhatia, Deputy United States Trade Representative, Conference Call on the US–India Trade Policy Forum, Washington, DC, 19 June 2006:

[21] Letter from Gary Martin, CEO of the North American Export Grain Association, to Gloria Blue, Executive-Secretary of the Office of the USTR, 15 September 2004.

[22] See also Aziz Choudry, "Bilateral Free Trade and Investment Agreements and the US Corporate Biotech Agenda," PAN AP and PCFS, February 2006:

[23] BIO letter to USTR on US–Korea FTA, 24 March 2006:

[24] BIO letter to USTR, 12 May 2006:; AMCHAM Malaysia/ US Chamber of Commerce public submission for the proposed US-Malaysia free trade agreement, 19 May 2006:

[25] Letter from James Greenwood, CEO of BIO, to the Senate Committee of Finance and the House Committee on Ways and Means concerning negotiations with the Russian Federation on its accession to the WTO, 9 June 2006.

[26] Emphasis added.

[27] See, for example, the mandate of the SPS Committee under the US–Colombia FTA:


[29] Patricia Ranald and Louise Southalan, "Ten Devils in the Detail":

[30] Inti Montenegro De Wit, " FTA means deeper poverty in Peru:GMO’s arrive, democracy doesn’t," August 17, 2006:


How the Biosafety Protocol was sabotaged

Ever since the Biosafety Protocol was adopted in January 2000, it has been mired in negotiations over its highly contested article 18(2)(a). The article arose as a last minute concession to GM exporters and it enabled the cartel of international grain traders to continue with their unrestricted trade in bulk shipments of crops contaminated by GMOs, provided that these shipments carried a warning (which in practice is virtually meaningless) that they "may contain" GMOs.

While this was a severe blow for those importing countries that were arguing for more serious information about food shipments, it was only meant to be operational until the First Meeting of the Parties to the Protocol, when members were supposed to thrash out more detailed rules. However, the grain trade cartel was determined from the beginning to prevent this from ever happening.

The major cereal and oilseed traders and the biotechnology industry came together to form the International Grain Trade Coalition (IGTC) to lobby for their interests within the BSP negotiations.[5] Although these companies have developed their own processes for segregating GM from non-GM commodities whenever it interests them to do so,[6] the IGTC has always claimed that the documentation requirements within the Protocol are completely impractical.

Early on, the IGTC began looking at bilaterals as a way to trump any documentation requirements that might emerge from the Protocol negotiations. In 2003, the IGTC’s Dennis Stephens wrote a paper encouraging GM exporters to use Article 24 of the Protocol to bring about greater clarity to documentation requirements for grain destined for food, feed and processing.[7] Article 24 of the Protocol is concerned with the rights of Parties to enter into ‘free trade agreements and arrangements’ with non-Parties.

In 2004, Mexico, a Party to the Protocol, entered into an arrangement for the implementation of Article 18.2 (a) with its North American Free Trade Agreement (NAFTA) partners, the United States and Canada, both of which are non-Parties to the Protocol.[8] The NAFTA arrangement mimics, pretty much word for word, the proposals of the IGTC, particularly where it comes to thresholds and the ‘adventitious presence’ of GMOs.[9] The IGTC began immediately to promote the deal as a template for an interim solution to Article 18(2)(a).[10]

After several contentious meetings, it was only in March 2006, in Curitiba, Brazil, that the parties to the Protocol finally agreed on a solution to Article 18(2)(a).[11] Interim documentation requirements for the next six years for trade in GMOs between Parties to the Protocol were adopted. But this agreement was only achieved after an enormous concession was made, once again, to the GM exporters. At the insistence of Mexico, the agreement expressly excludes the Protocol’s documentation requirements from applying to trade between Parties and non-Parties that occurs within the scope of bilateral, multilateral or regional agreements or arrangements.

The Biosafety Protocol thus provides a clawback clause and loophole for exporters not to comply with the documentation requirements established in the domestic laws of importing countries. It opens the door for them to turn to bilateral fora and trade agreements to undermine domestic regulations on the grounds that the Protocol itself excludes its own documentation requirements from applying to bilateral or regional trade arrangements.

The IGTC has not shied away from encouraging its members to pursue this loophole to maximum effect. In its post-Curitiba circular to members, the IGTC wrote: " As Parties may enter into arrangements with Parties or non-Parties containing documentation requirements different than [those contained in the Protocol] (such as are contained within the Mexico/United States/Canada Trilateral Arrangement), industry should not provide detailed documentation requirements until the requirements have been agreed upon bilaterally or regionally."[12] Meaning, keep exporting as usual and force bilateral settlements.

Norway makes ground-breaking decision to cancel illegitimate debt

Oslo, 3 Oct -- Norway’s Minister of International Development Erik Solheim announced that Norway is unilaterally and without conditions cancelling US$80 million in illegitimate debts owed by 5 countries: Egypt, Ecuador, Peru, Jamaica and Sierra Leone. Norway’s Government has, in effect, admitted that it’s lending in these particular cases was irresponsible and motivated by domestic concerns, rather than an objective analysis of the development needs of the countries involved. The débacle involves the export of Norwegian ships to developing countries between 1976 and 1980. It exported these ships mainly to secure employment for a domestic ship-building industry in crisis, not because these ships served the development needs of the countries concerned.

It is only fair therefore that Norway accept co-responsibility for the debts which resulted from these deals, says Eurodad. So far however, creditor countries have been incredibly reluctant to accept shared responsibility for negligent and often politically motivated and corrupt lending in the past. They have continued to insist that poor countries service these debts.

"This is a groundbreaking decision which has huge ramnifications for other lenders that acted irresponsibly in the past", said Eurodad’s Gail Hurley. "We urge Norway to continue to be at the forefront of international efforts to gain recognition for illegitimate debt. It is not fair that the populations of debtor nations continue to pay the price of corrupt, negligent and politically motivated lending in the past. Today the silence has been broken and we urge other creditor countries, in particular in Europe, to follow Norway’s bold lead".

South Centre News

President Mkapa Takes Over From Dr. Boutros Boutros-Ghali

Mr. Benjamin William Mkapa, former President of Tanzania, assumed the office of the Chairman of the Board of the South Centre on 16 October 2006 at the seventh meeting of the Council of Representatives in Geneva. President Mkapa took up this leadership role from Dr. Boutros Boutros-Ghali, who served a full three year term. President Mkapa was elected by acclamation for a regular term of 3 years as the new Chairman by the Council of Representatives, which consists of representatives of the 51 developing country Member States of the Centre. The Council meeting was conducted by the Convenor Luis Fernando Jaramillo.

Chairman Mkapa also held a meeting with the staff of the South Centre on 17 October. He plans to visit Geneva on 6-7 November, 2006 to meet informally with members of the Council of Representatives and to familiarise himself with the work of the South Centre.

The staff had an occasion to bid farewell to the outgoing Chairman Dr. Boutros Boutros-Ghali.

Board Meeting

The 17 th meeting of the Board of the South Centre took place in Geneva on 16 October, 2006. Members of the Board of the South Centre also met with Chairman Mkapa after he assumed office. Members of the Board also had occasions to interact with the staff of the Centre.

Trade for Development

This programme brought out the following publications:

· The suspension of the WTO DDA Negotiations: Scenarios and identification of pressure points for Developing Countries. This note identifies opportunities and challenges that the suspension of the WTO Doha negotiations has created for developing countries using three main possible scenarios for the negotiations: (1) Quick resumption and conclusion, (2) Slower resumption or early harvest, and (3) Hibernation or collapse of the round. The scenarios are used as a tool to identify possible pressure points and reflect on how to enhance developing country preparedness over the coming months.

· State of Play in Agriculture Negotiations: Country Groupings’ positions. The purpose of this note is to provide an overview of the position of various countries and group of countries active in the WTO agriculture negotiations with respect to critical issues under discussion. The note is organised on the basis of the three pillars of the agriculture negotiations (market access, domestic support and export competition).

The programme staff met with:

· Professor John Mumford (Imperial College-London) and Mrs Rachel Bedouin (FAO) on the 12 October to discuss several issues related to developing countries’ interests and challenges in the context of the WTO Sanitary and Phytosanitary (SPS) agreement. Professor and Mrs. Bedouin are preparing a study on the performance of the International Plant Protection convention (IPC) and were seeking information on issues that the South Centre saw as significant in the management of SPS matters in trade issues.

Innovation and Access to Knowledge:

The staff of this Programme:

· Organised an informal working lunch meeting on 23 October 2006 for developing country delegates in preparation for the meeting of the Council for TRIPS of the WTO that was held from 25-26 October 2006. During the meeting participants discussed the relationship between the TRIPS Agreement and the Convention on Biological Diversity (CBD) and technical assistance for Least-developed countries in accordance with the Decision for the extension of the implementation of the TRIPS Agreement by LDCs. Additional exchange of ideas took place with respect to the enforcement agenda of the European communities and the observer status of the CBD Secretariat to the Council for TRIPS.

· Participated as discussant at UNCTAD’s ad hoc expert meeting Intellectual Property Arrangements: Implications for Developing Country Productive Capabilities in the Supply of Essential Medicine, held from 19-20 October 2006, Geneva.

· Released the South Centre and CIEL IP Quarterly Update for the third Quarter of 2006. The focus piece of the Update was "Innovation, Essential Health Research and IPRs: The Who Working Group". The Update analyse the process up to the establishment of the Working Group and recommends focused and proactive engagement of devolving countries and civil society organisations.

Global Governance for Development

The South Centre, the Center of Concern, and the German Marshall Fund of the United States, jointly organized a workshop and policy dialogue on the trade and finance linkages for promoting development on 19 and 20 October 2006, respectively, at the Palais des Nations in Geneva. The event was also supported by the Heinrich Boell Foundation, the Swedish Ministry of Foreign Affairs, the United Nations Foundation, and the Forum for Environment and Development (Norway).

The "Trade and Finance Linkages for Promoting Development: A Policy Capacity-Building Workshop for Developing Countries", targeted developing country participants, NGOs, and academic experts. The workshop was aimed at enhancing the capacity of, and providing discussion space for, developing country policymakers with respect to trade and financial policy issues, the linkages between these two policy areas, and the identification of the policy options and flexibilities that developing countries may avail of in these areas in the context of the WTO negotiations and the upcoming UN Financing for Development process.

The subsequent policy dialogue, titled "Trade and Finance Linkages for Promoting Development: A North-South Policy Dialogue" included the participation of development partners from developed countries and multilateral development agencies. The objective of the policy dialogue was to stimulate the generation of common ideas and fresh perspectives on how the trade and finance linkage could be approached and on the policy options and flexibilities that exist or may be needed by developing countries in order to promote their development objectives.

Many Asian Countries Falling Short of MDG Targets

Bangkok, 16 Oct -- The Asian and Pacific region as a whole is on track to achieve most of the Millennium Development Goals (MDGs), but progress in many individual countries is slow and performance on some vital targets is unsatisfactory, according to UN Information Services quoting a new report.

The report ‘Millennium Development Goals: Progress in Asia and the Pacific 2006’ says that regional targets such as halving poverty and hunger, achieving universal primary education, and eliminating gender disparity in education are on track or have already been achieved. And progress on these is impressive compared to sub-Saharan Africa and even Latin America.

"The average progress, and relative performance, of the region, however, is no reason for early celebration," the report says. "The absolute size of social and economic deprivation remains enormous."

The MDG report updates the detailed analysis provided in regional report, "A Future within Reach 2005," released in September last year at the Millennium Summit in New York. It is produced through a joint regional partnership between the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), the United Nations Development Programme (UNDP) and the Asian Development Bank (ADB).

The new report points out that two thirds of Asia - or a total of 1.5 billion people - is still without access to basic sanitation. The region is also home to roughly three times as many underweight children and people living on less than $1 a day as sub-Saharan Africa and Latin America combined.

The region is not progressing fast enough to meet some important targets, including infant mortality and access to basic sanitation in urban areas. Meanwhile, HIV prevalence is actually on the rise and the proportion of people with access to improved water sources is declining.

The regional scorecards presented in the report mask some drastically uneven progress across countries. Many of the region’s developing countries, stretching from the Pacific to Central Asia, are likely to miss or even regress from a wide range of MDGs, including the targets on child health, and diseases such as HIV and TB.

Scaling up SADC Regional Integrattion

Final Communiqué of the Southern African Development Community (SADC) Extraordinary Summit of the Heads of State and Government to consider the Regional, Economic and Political Integration.

1. The SADC Extraordinary Summit of Heads of State and Government was held on 23rd October 2006, at Midrand, South Africa. Summit exchanged views on the scaling-up of the implementation of the regional economic integration, notably the launching of the Free Trade Area (FTA) by 2008, the preparations for the Customs Union by 2010 and SADC’s position on the African Union Government. The Extraordinary Summit was chaired by the Right Honourable Pakalitha Mosisili, Chairperson of SADC and Prime Minister of the Kingdom of Lesotho.

2. Summit was attended by the following Heads of State and Government and representatives: Botswana (H.E. President Festus Mogae); Democratic Republic of Congo (H.E. Vice President Azarias Ruberwa); Lesotho (The Rt. Hon. Prime Minister Pakalitha Mosisili); Madagascar (H.E. President Marc Ravalomanana); Malawi (H.E. President Bingu wa Mutharika); Mozambique (H.E. President Armando Emilio Guebuza); Namibia (The Rt Hon. Prime Minister Nahas Angula); South Africa (H.E. President Thabo Mbeki); Swaziland (Hon. Prime Minister Absalom Dlamini); United Republic of Tanzania (Hon. Prime Minister Edward Ngoyai Lowassa); Zambia (Vice-President H.E. Rupiah Banda); Angola (Minister of Foreign Affairs Hon. Joao Bernardo de Miranda); Mauritius (Minister of Foreign Affairs, International Trade and Cooperation, Hon. Madan M Dulloo).

3. The Extraordinary Summit was agreed upon at the Ordinary SADC Summit in August 2006, held in Maseru, the Kingdom of Lesotho. Its purpose was to review the status of regional economic integration and to propose measures to accelerate the implementation of the SADC economic integration agenda, especially the Free Trade Area to be attained in 2008 and a Customs Union in 2010.

4. Summit established a Task Force comprising the Ministers responsible for Finance, Investment and Economic Development, Trade and Industry and the SADC Secretariat to review and propose a roadmap to reach the agreed milestones for the implementation of the SADC integration programme.

5. The Extraordinary Summit considered the report and recommendations from the Task Force, and in particular the following aspects: Status of regional integration; Free Trade Area; Preparation for a Customs Union; Macro economic convergence; SADC Development Fund and Institutional framework and support to implement the SADC regional economic integration agenda.

6. Summit noted progress made in the attainment of an FTA and concluded that the SADC Free Trade Area programme is on course and that it will be launched as planned by 2008. However, Summit noted that SADC’s trade patterns consist mainly of commodities and that there is need to diversify the SADC economies and increase intra-regional trade and growth. In addition, Summit noted that the establishment of the FTA should take cognisance of developmental integration elements such as infrastructure, poverty alleviation and sustainable development.

7. Summit reaffirmed its commitment to the establishment of a SADC Customs Union by 2010 and directed the Ministerial Task Force to undertake and finalise a study, which will evaluate an appropriate model for a SADC Customs Union. In this regard, Summit directed that a road map be developed to facilitate the implementation of the SADC Customs Union programme.

8. Summit recognised the need for complementary instruments and policies to support regional economic integration for achieving high and sustainable economic growth and development in order to eradicate poverty. Summit urged Member States to formulate policies to forge convergence of SADC economies.

9. Summit reaffirmed the need to ensure that the process of deepening integration in SADC should always observe the principle of Member States equity, balanced development and mutual benefit.

10. Summit reaffirmed its commitment to regional economic development and in this regard, underlined the need to mobilise resources in order to address issues of infrastructure, food security and other supply side challenges within the SADC region. Summit noted that it is through the development of supportive infrastructure that the regional trade potential can be harnessed to the benefit of the people of the region. Summit therefore reiterated that the establishment of a Development Fund should be fast tracked.

11. Summit underlined the need to strengthen the SADC Secretariat in order to effectively lead and coordinate the implementation of the SADC integration programmes. In this respect, Summit directed that the Secretariat resources be increased and aligned with the SADC priority programmes, which seek to scale up the implementation of regional economic agenda.

12. Madagascar’s tariff phase down offer was accepted and Summit affirmed their support for Madagascar and noted that Madagascar is expected to deposit its instrument of implementation by mid-November 2006.

13. Summit noted the successful conclusion of elections in the Republic of Zambia and congratulated the Government and the People of Zambia on outcome of the elections which were in line with the SADC guidelines on elections.

14. Summit also expressed satisfaction with the manner with which the people and Government of Democratic Republic of Congo conducted themselves during the first round of the Presidential and Parliamentary elections. Summit called for the same political maturity to be maintained during the second round of Presidential elections.

15. Summit took note of the report of the Chairperson of the Ministerial Committee of the Organ on the African Union Government.

16. Summit noted the study on the African Union Government towards the United States of Africa and agreed that the effective establishment of the Union Government will occur when the African Continent attains higher levels of both economic and political integration.

  1. Summit expressed its appreciation to the Government and people of South Africa for the warm hospitality and the excellent arrangements made at short notice for the meetings.

Attached please find the latest issue of the South Bulletin no.134 in pdf
and word formats.

Best regards,

See attached file: bulletin134.pdf
See attached file: South Bulletin 134Word.doc

Someshwar Singh

Senior Editor
South Centre
Ch. du Champ d'Anier 17
1211 Geneva 19

web site:

Latest issue of the South Bulletin no. 134

Attachment: bulletin134.pdf (0.17 MB), SouthBulletin134Word.doc (0.24 MB)

Wednesday, November 1, 2006