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GATS: A monster in the making

This item is compiled by the Editor on the basis of a range of (quoted) sources.

THE proposed General Agreement on Trade in Services (GATS) is shaping up to be an even greater threat to democracy than the MAI (whose principles it embodies)

A new book by senior Canadian Centre for Policy Alternatives researcher Scott Sinclair is one of an increasing number of warnings about the GATS negotiations which are proceeding behind closed doors.

The book, "GATS: HOW THE WORLD TRADE ORGANIZATION'S 'SERVICES' NEGOTIATIONS THREATEN DEMOCRACY" describes how the GATS' ultimate purpose is to commercialise every service sector in every WTO member country - including essential public services such as education, water and health care. A summary can be downloaded from

Where to find GATS: Full draft is at tsintr.htm

and a summary can be found at ml

There is still time for Australia to say NO to GATS. A bulletin issued by AFTINET (Australian Fair Trade and Investment Network) after discussions with the Department of Foreign Affairs and Trade (DFAT) indicates that public health, education and social services are still excluded from the trade in services agreement, although private provision in health and education was included in the last round in 1994. The government says its policy is that these public services should remain excluded from the agreement.

However there is a danger that the government would offer to include the public Australian tertiary education sector in the GATS agreement, possibly as part of a trade-off for agriculture provisions it is seeking. Also, the Government is seeking encroachment of WTO authority into financial services, which means it could be made to remove the current figleaf of protection from anti-competitive bank mergers and takeovers.

Support for local industry under threat

Another danger relates to the right of State and local government to support local industry in purchasing policies like that published last month by the WA Government which favours WA tenderers and sets performance criteria. Source: According to AFTINET's information, the Commonwealth bureaucrats are moving towards giving WTO the right to forbid this.

There are already precedents for interference in the right of elected governments to use their purchasing power in the interests of their communities. New Zealand has a deal in place with Singapore to make these measures illegal in both countries. On October 25 Sean Healy of Green Left Weekly wrote on the basis of an examination of Australia and New Zealand's recent (temporarily) failed bid to enter a free trade zone with ASEAN. Sean wrote:

"The Singapore-NZ agreement . . .would render illegal any attempt by either government to base its procurement policy on anything other than competitive standards or to specify that any good or service must have more than 50% local content. . .Its anti-expropriation measures could prevent governments from passing regulations which significantly reduce the value of an investment. Similar anti-expropriation stipulations in the North American Free Trade Agreement have led to damages being awarded against governments for closing down environmentally damaging enterprises."

Sean's article is quoted in detail at .

However, irrespective of the Asian negotiations, a global General Agreement on Trade in Services could pre-empt the Government's reservations about barring support for local industry.

Plotting in Geneva

Writing in Canada's "Financial Post", columnist Murray Dobbin warned about secret negotiations going on at Geneva which are directed to installing a GATS which, like its predecessor MAI, would drastically reduce the democratic powers of the Australian people.

For a start it would sweep aside measures like those in WA, described above, to promote local business and industry.

Dobbin wrote: "WTO negotiators have set themselves no less a goal than to come up with binding rules to limit what all 137 member nations of the WTO - plus all of their subnational governments - can do in the area of regulation over services.

"The WTO has said that these new rules will automatically apply to all services without exception. The scope is breathtaking. At stake are issues as diverse as how strict our standards are for hospitals, whether we can protect historic buildings or control the invasion of big box stores, the kind of limits we put on tourist development in sensitive ecological areas."

But secrecy ain't what it used to be.

Dobbin added: "Restricted WTO documents leaked in Europe indicate negotiators are currently working up a list of what will be acceptable as a 'legitimate' government objective for any regulation governing services. That of 'safeguarding the public interest" has already been rejected.

"Canada and others ganged up on the European Commission for suggesting the list of legitimate objectives might include 'protection of the environment' and 'ensuring pluralism and a media system based on free and democratic principles'."

Dobbin's article is quoted in full at . [The reference to Walkerton is about a number of e coli infections including several deaths, caused by inadequate water quality.]

Are public consultations real?

Like Canada, Australia has a process of public consultation over relationships with WTO which would include GATS. As in Canada, the real consultations are with corporate business -- the blatant partiality of the Chairman of Australia's Joint Select Committee on Treaties (JSCOT) was shown in Citizens' Voice No. 7 (See ).

However, we have to make do with what we have while insisting on more, and many people have made submissions to the committee. Those which were e-mailed can be read on their web site at

and are a very interesting read indeed. Stop-MAI (WA) made a substantial submission which gives a very good idea of what is happening in Australia's relations with WTO and what we are doing about it. Look for No. 165.

Electronic commerce

E-commerce could become in the future the major way everyone does business, including many professional services. Web-based transactions such as for shopping or banking or even reading the latest Stephen King novel are well-established already, and more often than not they are international.

"If the [already-expressed] corporate position on e-commerce is integrated into the GATS, corporations would be able to shift any activity that is carried out on-line to jurisdictions where labour is cheap and submissive or where they find tax and environmental laws more to their liking," writes Sid Shniad, Research Director of Canada's Telecommunications Workers' Union in a major paper published at .

The writer demanded that Canada withdraw from GATS negotiations immediately, a call that could well be echoed also in Australia.: