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Matilda Lee

1st June, 2003

Matilda Lee explains how democracy is bypassed as multinationals push
changes in trade law through the labrynthine corridors of the EU

Pascal Lamy is probably the most influential man you’ve never heard of. In many ways, he is the most powerful man in Europe – despite what certain bellicose prime ministers might care to believe. For Pascal Lamy is the EU trade commissioner and leader of the European Commission’s Directorate General on Trade (DG Trade). And since the 1957 Treaty of Rome gave the European Commission exclusive powers to initiate European Community trade policies, and the sole ‘external’ voice to negotiate for the community on the global trading stage, that means that when Lamy speaks at the WTO he speaks for the whole of Europe – whether we have heard of him or not.

Understandably, the corporations and their lobbyists are very keen to win Lamy’s favour. Unfortunately for the world, Lamy seems to feel the same way about them; he shares their desire to open up markets to the greatest extent possible and increase European industry’s opportunities in world markets. He also has an unparalleled flair for shrouding the EU’s trade agenda in ‘sustainable development’ rhetoric. Like the corporations, he sees a new WTO trade round as the EU’s ‘number-one priority’. To make this seem more palatable to the outside world, he coined the phrase ‘the Doha development round’. But for the many developing-country representatives, who remember being bullied into ensuring Lamy and co got what they wanted at Doha, it is the ‘round of shame’.

Accuse Lamy of being a corporate stooge, however, and you’ll get short shrift. He insists: ‘Any suggestion that the commission has the intention to promote or request the dismantling of public services in any sector [through] the General Agreement on Trade in Services (Gats)… in any country… is based on speculation… not on fact.’ Yet, the EU’s recently leaked Gats requests call, for example, for 72 countries (including 14 Least Developed Countries) to liberalise the provision of their water services – all for the benefit of European water service companies.

He has also declared: ‘Services are among those new areas of trade that, because they directly affect a society’s preferences and way of life, quite rightly concern citizens and those who represent them.’ But access to documents by MEPs – the only people European citizens have directly elected to represent them in Brussels – is practically impossible.

UK Green Party MEP Caroline Lucas says: ‘Industry gets far greater access to the commission than the parliamentarians. Only under pressure would Lamy agree to show a small group of MEPs Gats documents. I had to sign a raft of papers saying that I would not share the information with anyone, keep the papers in a locked safe, refrain from copying or emailing them, and shred them after reading. Our idea of democratic scrutiny extends a bit further than this.’

Under the guise of openness, and to avoid ‘debilitating critique’ from civil society, Lamy has presided over the implementation of the so-called ‘civil society dialogue’ meetings that take place every two months and are attended by staff heads of DG Trade units. Lamy shows up for an hour every six months. Up to two thirds of the participants at the civil society dialogue meetings are industry lobbyists and consultants.

Rubber Stamping
Once Lamy and the commission, influenced by the corporate lobbyists, have decided what it wants, it sends a broad package of trade initiatives to the European Council of Ministers. The council, which in this case comprises the trade ministers of the 15 EU member countries (if it was discussing monetary policy, for example, it would comprise their financial ministers), then has to grant the commission a ‘mandate’ to negotiate at the WTO.

The commission’s negotiating strategy is ‘approved’ and the nuts and bolts of each issue thrashed out by the hazy but powerful Article 133 Committee. Appointed by the Council of Ministers and made up of high-ranking trade officials from the member states’ trade and economics ministries, the committee meets every Friday.

If any member state had commitments to an ‘ethical’ or ‘sustainable’ trade agenda, it would be at the Article 133 Committee that they would be firing the alarm. They would rarely find much support, however. The Dutch trade minister, for example, was pressured by members of the Dutch parliament to keep water services out of Gats. In the face of opposition from France and Germany, his proposal didn’t stand a chance. The two countries are home to Europe’s biggest water corporations and, like Britain, insiders say, ‘particularly effective in getting their points of view across when proposals are being drafted’.

Like Lamy, their objective is the expansion of free trade. UK secretary of state for trade and industry Patricia Hewitt has publicly defined her goal as ‘opening up protected markets in developing countries’. A new WTO trade round, she says, ‘is the best way of ensuring that our businesses can benefit from… future economic growth anywhere in the world’.

You may be wondering what influence the European electorate has over any of this. The answer is not a lot. At the end of each round of negotiations, any agreements made are sent back to the Council of Ministers. If – and only if – any of these final trade agreements involve the creation of new institutions, then they are sent to the European Parliament for its ‘assent’.

Otherwise, the parliament has only a very limited ‘consultative’ role in trade negotiations. It is fighting to get explicit power to ratify all trade agreements, but in the meantime the current legal limbo and democratic deficit persist. And if a WTO trade agreement were to be voted on in the UK’s House of Commons, Tony Blair would be supported by a majority of Labour MPs. So, party discipline, enforced by the whips, would ensure that any vote would be passed by a pliant majority.
This means that, one four-yearly vote aside, we the voters have no say over what is decided in Brussels. Which is just the way they want it.

Matilda Lee is a section editor of The Ecologist

This article first appeared in the Ecologist June 2003

 

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