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GATS
- EXPLAINED
Most
media, elected officials and public servants, let alone the general public, are
unaware of GATS, or of its implications.
GATS
targets elected governments… Local, State and Federal. It seeks to privatise
all public services, everywhere. But several countries are demanding that a
wide-ranging assessment of the impact of a free market in services be carried
out. Non-government organisations (NGO's) and trade unions, such as the
Australian Nurses' Federation, are demanding that services in the public
interest be clearly exempt from GATS.
In
Australia, Medicare, public hospitals, parks and wildlife services, the ABC,
public education, financial regulation, telecommunications, the transport
industry… including roads, and Council procurement systems are at risk.
All
taxpayer support will be called a "subsidy" to be equally available to
all commercial and public suppliers.
All
treaties are signed in Australia without debate in parliament or the media. This
is called fast tracking. We have already signed 80 of 160 service area codes,
including dentistry and health insurance, but much worse is to come! This will also include Medicare, environment and shipping regulation.
Origins
The
1986-94 Uruguay Round of GATT, the widest-ranging multilateral trade agreement
ever negotiated, covered for the first time not only services but also
agriculture, investments and intellectual property rights, such as patents,
trademarks and copyright.
The
28 agreements, which now come under the WTO, fall into six broad categories:
-
Multilateral
Agreement on Trade in Goods
-
General
Agreement on Trade in Services (GATS)
-
Agreement
on Trade-Related Aspects of Intellectual Property Rights (TRIPs)
-
Understanding
on Rules and Procedures Governing the Settlement of Disputes
(DSU)
-
Trade
Policy Review Mechanism (TPRM)
-
Plurilateral
Trade Agreements
The
WTO administers and implements these various agreements, acts as a forum for
multilateral trade negotiations, resolves trade disputes, oversees national
trade policies and cooperates with other international institutions involved in
global economic policy-making.
The
WTO's legislative and judicial power to challenge the laws, policies and
programmes of countries that do not conform to all its agreements, particularly
if they are regarded as too "trade restrictive", sets the WTO apart
from other international agreements.
GATS
Main Obligations
Trade
in services used to be considered ancillary to manufacturing and trade in goods.
In the mid-1980s, however, many Western governments, faced with worldwide
recession, inflation and unemployment, decided that removing obstacles to
international trade in services, particularly national regulations, could
increase the momentum to export services.
The
US thus pushed for the provisions of the agreements governing trade in goods to
be transposed into the area of services as a whole (although financial services
were of prime interest), a move which "could easily have sunk the Uruguay
Round and crippled the GATT", according to WTO Director-General
Mike Moore. Many countries reluctantly agreed to GATS only if they could choose
which of their services were covered by the 'Agreement'. The US took care,
however, to include clauses mandating further liberalisation in future.
Two
GATS obligations apply directly and automatically to all WTO members for all
services: most-favoured-nation treatment and transparency.
Once
a government has committed itself under GATS to opening a service sector to
foreign competition, it must not keep money from being transferred out of the
country to pay for the relevant services (Article XI), except when the country
is experiencing serious balance-of-payment difficulties (Article XII). Such
exceptions must be temporary and justified by an International Monetary Fund
assessment of the country's financial situation.
GATS,
thus provides almost guaranteed conditions for foreign exporters and importers
of services and investors in any sector which a country has listed in its
Schedule.
Following
the GATS "built-in agenda" mandating successive rounds of
negotiations, talks opened on 25 February 2000 in Geneva, home to WTO
headquarters. The United States would like these negotiations to be completed as
soon as possible, and suggested the end of the year 2002 as a deadline. Other
countries, however, want the negotiations to be open-ended, or integrated within
a broader and comprehensive revision of all the WTO agreements.
Despite
the requirement for "transparency" in GATS, the renegotiations are
taking place between government representatives behind closed doors (but in
close consultation with international corporate lobbyists). The WTO or
individual countries make few of the results of discussions publicly available.
It is next to impossible for citizens' organisations to find out the current
state of negotiations while access to many background documents is restricted.
Thus
even negotiations on apparently technical issues such as reclassification of
services are evading public accountability and public and parliamentary debate.
A 'Working Party on Domestic Regulation' - one of the three sub-groups of the
Council for Trade in Services (the body within the WTO that oversees GATS), has
been drawn up to discuss "reform" of domestic regulation. This
involves drafting a "necessity test", a legal formula that could be
used "to assess the level of trade-restrictiveness of a measure".
If
proposals for this test were adopted, a government challenged by another through
the WTO would first have to show that a disputed regulation met a
"legitimate objective" - and the WTO would determine what counted as
"legitimate".
Then,
to clarify "burdensome" and "restrictive" as applied to the
means of achieving that objective, the Working Party has considered importing
into Article VI.4 the definition of "least burdensome" from a GATS
Annex on Telecommunications: "pro-competitive".
The
European Union has gone further and identified "anti-competitive
practices", including cross subsidising by monopoly providers of network
infrastructure and services. It argues that this practice restricts competing
suppliers from being able to provide services in a market. Instead, it maintains
that charges for each part of a service should be at: "cost-oriented rates
that are transparent, reasonable, having regard to economic feasibility, and
sufficiently unbundled so that the supplier need not pay for network components
or facilities that it does not require for the service to be provided".
Governments
that currently use non-market mechanisms, such as risk pooling, social insurance
funds, block contracts and cross subsidising, to deliver public services to as
much of their population as possible could find such practices challenged as
anti-competitive.
The
European Union has also suggested that a measure should not be considered
trade-restrictive if it is "proportionate" to the objective pursued.
But what might be considered proportionate, reasonable or rational would be a
matter of judgement, reflecting the values of those with decision-making power.
Worse,
Article VI.4 could be interpreted as applying to all services, not just to
those, which a country has offered to liberalise. The other clauses in Article
VI clearly apply only to those services listed in a country's schedule of
commitments. The WTO Secretariat believes the different phrasing of Article VI.4
is "intentional".
If
these proposals were adopted, all domestic regulations would have to be
"pro-competitive", even if no foreign firm was involved. A WTO
disputes panel could require countries to unbundle a public monopoly such as
health care and substitute competing service providers or competing health care
insurers. Health systems researchers Allyson Pollock and David Price point out
that these proposals "would transform the WTO from a body combating
protectionism to a global agent of privatisation".
"The
WTO's strategy is shifting from persuasion to the development of new global
regulations which will over-ride national sovereignty in domestic policy and
impose unprecedented market reform obligations on all the processes of service
delivery and throughout all service sectors".
In
essence, the aim of GATS is to regulate governments, not corporations.
Compared
to markets in goods, those in services and access to them are more constrained
by government interventions. The power of a GATS article on domestic regulation
clause is that many governments may censor themselves by not instituting
legislation or public policy objectives which could be interpreted as being
against WTO rules. There has been no challenge to any domestic regulation under
GATS as yet, but as the WTO Secretariat itself acknowledges, "cases may
arise in the future".
GATS
sets in place a legal framework which governments could use in future to
challenge other countries' domestic regulations. The WTO stresses that
governments can still regulate under GATS!
However,
discussions
about domestic regulation, raises the question… HOW?
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GATS
- PRIVATISING ALL SERVICES
In secret, governments are
negotiating the end to all non-profit public services. By December 2003, 130
plus governments are expected to quietly sign an agreement called GATS, General
Agreement on Trade in Services, which will lay all government services open for
international tender, and no doubt international labour. That is, foreign, lower
paid nurses, teachers, water technicians, postal and transport workers.
Public services are next in line for the WTO's corporate battering ram.
Global corporations have been so successful in persuading governments
worldwide that their agendas are the same… that the pursuit of corporate
profit and the good of society are one and the same, that their access to many
areas of public life has already been attained. Quality of service and
democratic access has not necessarily improved.
Services are the fastest growing sector in international trade, and
employs 72% of Australians. Services offer rich pickings for canny corporations.
And of all public services, health, education and water are shaping up to be the
most lucrative. Global expenditures on water services now exceed $1 trillion
every year; on education, they exceed $2 trillion; and on health care, they
exceed $3.5 trillion.
The USA might suggest a model for the dismantling of public services
which GATS will unleash all over the world. In fact, much of the GATS policies
and the World Trade Organisation policies are designed to increase USA mega
corporation domination of world markets.
In America, health care has
already become a huge business, with giant health care corporations registered
on the New York Stock Exchange. Rick Scott, the president of Colombia, the
world's largest for-profit hospital corporation, is clear that health care is a
business, no different to any widget manufacturer.
He has publicly vowed to
destroy every public hospital in North America… doctors, he says, are not
'good corporate citizens'. Americans spend twice as much on Health as a percent
of their bloated GNP, yet over service the rich, and cannot really care for 40
million of their own increasingly large poor segment of society.
Meanwhile, investment houses like Merrill Lynch are already predicting
that public education will be globally privatised over the next decade the way
public health has been. They say there is an untold amount of profit to be made
when this happens.
The European Union recently
announced that every publicly run school in Europe must be twinned with a
corporation by the end of the decade. The conquest of foreign market and support
of big business has now become a key common strategy among universities around
the world. So much for academic freedom!
Many parts of the 'Third World' have been forced to dismantle their
public infrastructures in recent decades under International Monetary Fund
imposed structural adjustment programs. In order to be eligible for debt relief,
for example, dozens of 'developing' countries have been forced to abandon public
social programs over the last 20 years.
Millions of people in over 100
countries are now without basic social services and have a lower standard of living than
20 years ago.
The World Bank is now
forcing the same countries to privatise their water services and is openly
working with corporate water giants like Vivendi and Suez Lyonnaise des Eaux, to
establish their 'rights' to profiteer in the Third World. Protesting Bolivian people have
been shot protesting water charges that cost a third of their wages.
Now, through the GATS negotiations, these corporations want binding and
irreversible rules guaranteeing them access to government service contracts
everywhere in the world... and they are succeeding.
Already, over 40 countries,
including all of Europe, have listed education within the realm of the GATS,
opening up their public education sectors to foreign-based corporate
competition.
Almost 100 countries have
done the same with health care. As the new talks progress, it will be very hard
for any country to swim against the tide…even if they try.
Disturbingly, GATS also includes authority over 'environmental services'
and natural resource protection. Our parks, wildlife, river systems, and forests
could all become contested areas, as global transnational 'environmental
service' corporations demand the competitive model.
Frighteningly, there can be no local restrictions on quality of graduates
and service standards; this would be seen as a "barrier to free
trade".
How will 72% of Australian
workers in health, education, environment, childcare, transport, tourist, broadcast, social
work, dentist, teaching, and office staff feel should cheap foreign labour enter
the Australian work force? It has already happened with the 'Emerald Affair'.
Why did we allow Australian
public assets like our refugee/prison facilities, to be owned and operated by
the multinational USA corporation, Wackenhut?
Remember Beazley and Howard
wanted Australia to sign the MAI Treaty… later shown not to be Australia's
best interests!
Well... GATS is the rebirth of the
MAI, but with more clout!
Perhaps some of the $800
billion that has come into Australia in the last decade to buy our Australian
industries, property and taxpayer-owned assets, the profits of which leave Australia untaxed, has
influenced Canberra.
Ask your elitist,
self-serving, snout-in-the-trough party politicians why they remain silent on
the GATS issue!
I can only ask:
