Lyhyt oppimäärä investointeihin

Put crudely, liberalisation is the practice of dismantling a government's interventions in its own economy which directly or indirectly confer some advantage on its own companies when competing against similar companies from other countries. There is no shortage of people willing to sing the praises of liberalisation (because in a somewhat contrived sense it creates a "level playing field" between trading nations and favours the most "efficient" producers) but increasingly critics note that, applied ideologically, it often has aggressively negative social consequences and, underpinned by the remorseless pursuit of economic growth, is ecologically unsustainable. Perhaps the most well-known negative phenomenon associated with trade liberalisation is the concentration of wealth and, accordingly, power. Such concentration can be understood intuitively; if you pitch the strong against the weak (whether in the context of companies, countries, continents...) but do not discriminate in favour of the weak contender, there is only ever going to be one winner.

So the "level playing field" argument is disingenuous; it is a charter for the concentration of power and resources. As a practical example, liberalisation as advanced by the WTO (which encompasses not just trade in goods but also services, agriculture and other areas) has caused de-industrialisation and growing food insecurity (with a consequent decline in national welfare as wealth-creating capacity is diminished, self-reliance is undermined and revenues flow out of the country) in many developing countries because their nascent companies and small-scale farming have been unable to compete against the gigantic economies of scale enjoyed by dominant global companies.

So what's this got to do with investment? Well, powerful WTO members - most notably the EU (which operates, on behalf of its member states, as a single entity in the WTO) and Japan - are determined to expand the reach of the WTO into foreign investment, taking the WTO mandate far beyond the goods focus of the original GATT. The EU and its supporters on this issue contend that WTO members should move towards adopting and locking-in a liberal model of foreign investment management. So, in the eyes of (for example) EU trade bureaucrats, it is undesirable for a country to block incoming foreign investment in certain sectors, steer incoming foreign investment to other sectors, discriminate in favour of its own investing companies, prefer foreign investment from one country over another, place performance requirements on foreign investment...and so on. But history teaches us that, if foreign investment is to bring any benefits to a country at all, it has to be "managed", because the assumption that unrestrained investment flows (which naturally seek out those domestic sectors guaranteed to yield high returns in as little time as possible) dovetail completely with the needs of a country and its people (and its environment) is misplaced. Indeed, we know this because, prior to their latter-day (and selectively implemented) love-affair with liberalisation, most developed economies themselves used what would now be called "protectionist" investment policies to enable them to get a foothold against competing economies.

Furthermore, the struggle against WTO-Investment should not only be viewed through a 'development' lens. Every society, whether in the North or the South, should have the right to democratically intervene in its economy to pursue goals such as the stimulation of local economic activity, promotion of local ownership and ecological sustainability. Thus, WTO-Investment threatens progressive social organisation the world over, not just in the South. Hence, this is not a struggle in which the citizens of the North are pitched against the citizens of the South. No. This is a struggle which pitches the selfish interests of concentrated wealth (most obviously manifest in the views of transnational corporations and their client governments) against normal people the world over.

So the bad news is that the EU and friends (with the US lurking somewhere in the background, we can be sure) are pushing a model which will significantly constrain the abilities of weaker and poorer WTO members to manage foreign investment effectively, and (more generally) permanently lock in a deregulatory investment model the whole world over, to the disbenefit of all peoples. People and the environment will be the losers; ever-expanding transnational corporations will be the winners. Furthermore, the fact that the WTO is effectively a power politics organisation (with the main players being the US, EU, Japan and Canada) means that unless we, members of civil society, make our voices heard, there is a real danger that the EU and friends will be successful in launching WTO-Investment negotiations this September, at the next WTO Ministerial conference in Cancun, Mexico.

It is difficult to overstate how important it is that we block, using whatever channels available to us, the adoption of an investment agreement by the WTO.

At the last WTO Ministerial (November 2001, at Doha in Qatar) the EC and friends used power politics to bring a WTO-Investment agreement one step closer. (WTO members had been talking about the practicalities of such an agreement since 1996, in the Working Group on Trade and Investment, but without commitment to actual, concrete negotiations.) Now, in the run-up to Cancun, the EU and friends are pulling out all the stops to generate the "consensus" required to commence negotiations. We can expect the pressure in this direction to increase dramatically in the coming months.