The Guardian September 6, 2000


The story behind Seattle

by Martin Khor*

The street protests by civil society and US-EU differences may have played 
a part, but the main factor that torpedoed the Seattle talks was the non-
transparent and undemocratic nature of the WTO system, which many 
developing countries could no longer tolerate. The WTO Ministerial 
conference imploded from within.

It was an amazing week. In Seattle, the contradictions of globalisation 
revved to a climactic conclusion. At the end, the WTO Conference that was 
supposed to launch a new round collapsed, suddenly, in almost total chaos, 
like a house of cards.

There is no new round, no Seattle Declaration, not even a brief joint 
statement to thank the hosts or decide on the follow-up process.

In the aftermath, there will be many theories and analyses on what 
happened.

Some will focus on the protests by civil society groups representing 
labour, environment, consumer, pro-poor and Third World concerns. There 
were also the "direct action" activists who blocked delegates" access to 
the opening ceremony, which had to be cancelled.

Coming of age

The main message of the protesters was heard loud and clear, that the WTO 
has gone much too far in setting global rules that "lock in" the interests 
of big corporations at the expense of developing countries, the poor, the 
environment, workers and consumers.

The impact of grassroots protests against globalisation, already evident in 
the campaigns against the Multilateral Agreement on Investment (MAI) and 
against genetic engineering, had its coming of age in the street battles of 
Seattle.

Some will also pinpoint the inability of the US and the European Union (EU) 
to bridge their differences as the immediate cause of the collapse. This 
was, of course, a significant factor.

The two giants of the trade system were striving for a compact in which the 
EU would agree to significantly reduce their agriculture subsidies, and in 
return the US would agree to start negotiations on new issues like 
investment and competition.

As a last chip, the EU also threw in its support to the US to form a WTO 
working group on biotechnology, but this fell foul of the European 
Environment Ministers who objected to the EU's move, for which they said 
the EU had no mandate.

This open spat between the EU and the Ministers further muddied the last-
ditch attempt of the EU and the US to agree to a new round.

Non-transparent & undemocratic

However, the more basic cause of the Seattle debacle was the non-
transparent and undemocratic nature of the WTO system, the blatant 
manipulation of that system by the major powers, and the refusal of many 
developing countries to continue to be on the receiving end.

The seeds of the North-South battle were sown in Geneva in the weeks before 
Seattle.

Developing countries voiced their disillusionment  that five years after 
the WTO"s creation they had not seen any benefits.

Worse, the poor countries face potentially enormous dislocation when they 
implement their obligations arising from the WTO's many agreements.

They put forward dozens of proposals to resolve the "problems of 
implementation" of the WTO agreements, including changing some of the 
rules.

But most of their demands were dismissed by the major powers that, instead, 
pushed for their own proposals to further empower the WTO through 
introducing new areas such as investment, competition, government 
procurement, and labour and environmental standards.

The developing countries, in general, opposed these new issues which they 
saw would open up their markets further to the big companies of the rich 
nations, or would give these nations new protectionist tools to block Third 
World products from entering the North.

Even worse, the WTO secretariat was used by the major powers to engage in 
non-transparent procedures, such as holding informal meetings on crucial 
issues in small groups to which most developing countries were not invited.

These so-called "green room" meetings infuriated the Third World members of 
the WTO.

At Seattle, in contradiction to her promise to run a transparent meeting, 
the US Trade Representative Charlene Barshefsky, presided over a totally 
undemocratic process.

She announced on the second day her "right" as chairman of the conference 
to use procedures of her own choosing to get a Declaration out of the 
meeting, a statement that infuriated the developing-country delegations.

Barshefsky and the WTO Director-General Mike Moore, set up several "green 
room" meetings, some running simultaneously, on key issues of disagreement.

Only 10 or 20 countries (the major powers plus a few selected developing 
countries) were invited to a typical such meeting.

Shutout

The plan of the organisers was to get the major powers (mainly the US and 
the EU) to agree among themselves, then apply pressure in the green rooms 
on a few influential developing countries to go along, and then pull 
together a Declaration to launch a new round which all members would be 
coerced to accept in a special meeting on the last day.

The vast majority of developing countries were shut out of the whole green-
room process. They were not even informed which meetings were going on or 
what was being discussed.

Ministers and senior officials of most developing countries were left 
hanging around in the corridors or the canteen, trying to catch snippets of 
news or negotiating texts.

Their anger at the insult of being at the receiving end of such shabby 
treatment boiled over on the third day of the conference.

The African Ministers issued a strong statement that there was "no 
transparency" in the meeting, that African countries were generally 
excluded on issues vital to their future, that they were concerned over the 
intention to produce a Ministerial text at any cost.

"Under the present circumstances, we will not be able to join the consensus 
required to meet the objectives of this Ministerial Conference."

Similar statements were issued by the Caribbean Community Ministers and by 
some Latin American countries.

Barshefsky and Moore were thus faced with the prospect that if a draft 
Declaration were presented at a final session, there would be an explosion 
of protests and a rejection by developing nations.

That would totally expose to the public and the world media the 
manipulative methods by which the Seattle conference, and more seriously 
the WTO in general, had been run.

In the end, it was less embarrassing to decide to let the Seattle meeting 
collapse without attempting even a brief Declaration.

But the breakdown took place so fast that Barshefsky at the final plenary 
did not even try to get the ministers to adopt a formal statement on the 
procedures for follow-up talks.

All that was left is a transcript of Barshefsky's off-the-cuff closing 
remarks, in which she admitted that "we found that the WTO has outgrown the 
processes appropriate to an earlier time... We needed a process which had a 
greater degree of internal transparency and inclusion to accommodate a 
larger and more diverse membership."

Post-Seattle process

Do the Seattle debacle and Barshefsky's remarks give hope for reform to the 
WTO's decision-making system?

That depends really on whether the developing countries can now make use of 
the impasse to press for a democratic system, for example, by abolishing 
the green-room process, which belongs to the feudal age and which 
ultimately sank Seattle.

The big powers will, however, try hard to cling to their privileges.

Both Barshefsky and the EU Trade Commissioner Pascal Lamy announced that 
the WTO Director-General had now been delegated with the authority to carry 
forward the Seattle process.

Lamy even told the media that Moore would report directly back to the 
ministers.

* * *
*Martin Khor is the Director of Third World Network

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