Held as part of the Global Peoples Forum, Nasrec, 27 August 2002

Situation Analysis
Trade and trade rules do not currently support sustainable development. Deteriorating terms of trade have left developing countries, particularly in Africa, worse off. Trade has exacerbated inequalities between and within countries, environmental degradation, poor working conditions, unemployment and has led to de-industrialisation in developing countries. Trade is used as an instrument to open developing country markets and impose a particular type of economy.

The current 'free trade' system is far from free. It is enforced, controlled, conditional, managed, manipulated and protectionist. Even 'informal' trade, practiced mainly by women, outside the policy control of government is not free, for such informal traders are 'informally' harassed by immigration, security and custom officials.

This managed trade, which aims to serve production, is propped up by the World Trade Organisation's trade and trade-related agreements. It is enforced through the WTO dispute settlement mechanism, whose power is only comparable to the United Nations Security Council.

The reform suggests put forward by governments and others are insufficient to reorient trade towards sustainable development. Market access, commodity price stabilization mechanisms, abolition of export subsidies etc. only address the symptoms of the problem and will not tackle the root causes of our highly unsustainable global economy.

Priority Issues
· Reorient the economic system to serve people - particularly poor people, their environment and local economies. Base it on sustainable production and consumption, not increased consumption and profitable production. Trade should be a means to reach sustainable development, not an end-goal in itself. A new economic system will result in changed consumption patterns that reduce over-consumption of rich people and countries and redirect production towards meeting poor people's needs. People will consume primarily what they produce and trade at a local level.

· Revamp the trade system and redefine the role of trade in our economies. Redirect trade to domestic economies and regions. Reconceptualise, reduce, redirect and re-regulate trade so that it plays a developmental role.

· Developing countries need rights and policy space to diversity production in order to overcome supply side constraints. Trade policies should be directed by industrial policies, with the aim of achieving sustainable production and consumption.

· Reform global economic governance. (Good economic global governance is not good governance as narrowly defined by IMF, WB et al)

· Reaffirm and implement key Rio Principles that are being undermined by the current trade regime, in particular the principles of Common but Differential Responsibility and the Precautionary Principle.

· Developing countries should have the right to protect their own agriculture in order to ensure local food security, with subsidies, tariffs etc. Guarantee food security to small-scale farmers.

Specific Recommendation
Abolish or fundamentally restructure the WTO. At a minimum:
· No new issues, such as investment, competition, government procurement (Singapore issues) in the WTO
· Reform or remove existing agreements that are creating problems, such as Trade Related Aspects of Intellectual Property Rights (TRIPS)
· Introduce democratic decision making process in the WTO and situate it firmly within a democratised UN system to serve human rights and sustainable development.
· Take agriculture out of the WTO - agriculture is not a commodity, it is a means of livelihood and survival for small scale farmers. It should also be removed from other agreements such as NEPAD, FTAA etc.
· Respect principles such as benefit sharing, as agreed in the Convention on Biological Diversity and environmental justice.

Build and strengthen global governance to advance sustainable development and human rights. At a minimum:
· Get the WTO out of the WSSD.
· Give precedence to Multilateral Environmental Agreements (MEAs), labour and human rights agreements over WTO agreements.
· Strengthen the role of the ILO In relation to the WTO.
· Restructure the IMF, WB and WTO.
· Regulate corporations through a framework and convention for corporate accountability and responsibility.

Cancel third world debt.

Impact assessments of effects of existing and proposed trade rules and agreements on environment, health etc. must be carried out.

The rich countries should abolish harmful subsidies.

Trade and the institutions that support it need to be fundamentally restructured so that they are firmly situated within a framework of sustainable development. If it is not abolished, the powers of the WTO should be reduced and it should be located within a reformed and democratised United Nations and subject to global agreements, such as those on human rights, women, labour, development and the environment.