28 August 1997 Edition

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Private greed - paid for by us all

Robert Allen on a report which warns of the malignant power of global corporations

Over the past few years the European Union and the United States have been attempting to set a free trade agenda for the rest of the world - on their terms. But the impact of such an agenda would be to give global corporations the freedom to control the market economy with little regulatory interference from governments - in other words a global carpetbagger's charter. It's called the Multilateral Agreement on Investment (MAI) and before you know it that global club called the Organisation for Economic Co-operation and Development (OECD) will have it implemented, the idea being that this agenda will establish international rules for foreign direct investment by private capital in countries that agree to the MAI. The MAI is presently being negotiated by the OECD, a Paris-based international policy organisation comprising 29 counties and 447 of the world's largest corporations.
The Multilateral Agreement on Investment (MAI) would allow corporations the freedom to exploit markets without restriction of any kind, including legislation that would seek to protect the environment and the health of communities. The OECD has been negotiating the MAI in secret since 1995 and it was only the leak of a draft that exposed it in February this year

Earthwatch's Sadhbh O'Neill was a member of the Irish delegation which represented the Network of Irish Environment and Development Organisations (NIEDO) at the Second Earth Summit in New York in late June. Globalisation featured prominently at the Summit but according to O'Neill, who has just prepared a report on the follow-up to the first summit at Rio in 1992, communities and the environment did not. ``The Multi-lateral Agreement on Investment will,'' she stated in her report ``reduce the power of national governments to stipulate conditions under which transnational corporations and investors operate within their countries. So far the MAI has not included any reference to environmental protection or sustainable development, but there is approximately another few months to influence the draft agreement, which was deliberately introduced by the US through the OECD to avoid both organisations [the United Nations and the World Trade Organisation].'' The MAI seeks to protect and expand the power of corporations and wealthy individuals by guaranteeing them:

a stable investment climate;

easy repatriation of profits;

open-market access by establishing National Treatment and Most Favoured Nation designations;

freedom from complying with regulations and legislation pertaining to environmental, social and health safeguards and freedom from any obligation to serve local needs.

If implemented the MAI would allow private investors and corporations to sue governments and seek compensation at international tribunals for failure to protect these benefits. In other words the MAI would allow corporations the freedom to exploit markets without restriction of any kind, including legislation that would seek to protect the environment and the health of communities. The OECD has been negotiating the MAI in secret since 1995 and it was only the leak of a draft that exposed it in February this year.

O'Neill quotes Dr Vandana Shiva, the physicist, philosopher and ecofeminist. According to Shiva the process of globalisation is a ``rewriting of the social contract, or the contract between governments and people. What we're getting is a whole series of new policies that is turning the government from being an instrument that people can use, into being an instrument that only foreign corporations can use against the people. Behind this restructuring of the social contract is a rewriting of the rights of people''.

If O'Neill's analysis of this cosy summit tells us anything it is the horrible fact that the majority of the people on this planet have no say or control over their lives. People like Shiva are lone voices on the subject of globalisation and while non-governmental organisations (NGOs) like Earthwatch and Greenpeace are well meaning in their concerns their ability to influence the Summit was negligible. ``NGO concerns about globalisation and the rise of corporate power never made their way onto the agenda proper,'' O'Neill laments in her report, noting that delegates concerned about the globalisation of private capital had their arguments quashed by a combined assault from the delegates representing the more powerful developing nations and the US - largely on behalf of the global corporations. The developing world wants finance, development aid and technology while the developed world (aka the corporations) wants carte blanche to do what it likes.

O'Neill notes dryly that the prognosis for the world's environment does not look good. ``Since 1992 new issues and concerns [have] reared their heads; concerns about globalisation, climate change, forest depletion, financial crises for developing countries and ubiquitous environmental degradation.'' From the beginning, she adds, there was little chance of progress in New York. ``At the 5th session of the UN's Commission on Sustainable Development, established in 1992 to oversee the implementation Agenda 21, it became evident that developing countries represented by G-77 were unwilling to sign up to any new commitments on sustainability without the resources promised five years earlier at Rio. For their part, industrialised countries simply wanted to `re-confirm' Agenda 21 without shifting their positions on financial, trade and investment issues.''

So we continue to hurtle towards the inevitable. ``Corporations now control more of the Earth's resources than public bodies or governments,'' says O'Neill ``and the incessant demands of their shareholders to increase profits can only be met by capturing an even greater share of the world's gains while passing on to others the costs - Noam Chomsky calls this `privatising gains and socialising costs'. Added to this is the fact that global institutions that have taken unto themselves the responsibility for managing the global economy - the World Bank, the International Monetary Fund, the World Trade Organisation, the OECD, the International Standards Organisation, G-7 and others - are wholly undemocratic, secretive and dominated by corporate interests.''

O'Neill, however, is optimistic. ``As the environmental crisis gets worse, people are also getting more assertive and active, and new relationships are being forged between environmental activists and trade unions, fishermen, farmers and indigenous peoples.'' And she quotes Shiva who says ``that's precisely because it is a crisis for survival''.

The 32 Counties are part of the OECD yet despite the pathetic roars of the Celtic Tiger the people of Ireland are dominated by corporate capitalism. The news this week that over one in four children in the 26 Counties lives in poverty should be an indication that the policies of successive Dublin governments have failed - and that's because we handed the state over to the corporations four decades ago.


The full text of Sadhbh O'Neill's report is available as a supplement to Pobal an Dulrá #10, available from Pobal an Dulrá, 10 Upper Camden Street, Dublin 1 or by e-mailing [email protected]
Robert Allen adds: Sadhbh O'Neill is to be congratulated for writing this report and making it available to individuals who are not part of the NIEDO.

Robert Allen is the co-author (with Tara Jones) of Guests of the Nation - about the impact of global capitalism on Irish communities, published by Earthscan, 1990.

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