Nov 14/96: APEC, Free Trade and "Economic Sovereignty"


Aziz Choudry
November 14, 1996

Paper presented at conference in Davao, Philippines, prior to the Manila People's Forum on APEC

Greetings from structurally adjusted Aotearoa/New Zealand.

APEC, WTO, GATT, NAFTA, PECC, ABAC, EU, FDI, ADB, IMF, SOMs, SAPs, TNCs; we live in a world so thickly populated by acronyms, abbreviations, Orwellian doublespeak, obscure jargon, and dictated to by a set of arcane economic truths (which only the "experts" claim to be qualified enough to understand) that it's getting harder and harder to see how the planet and its peoples fit in to the picture.

Native American poet and activist John Trudell calls the New World Order "an Old World Lie". The neoliberal market ideology which dominates APEC is based on the same kind of twisted anti-human logic and value system which has legitimised colonialism over the centuries. In Aotearoa/New Zealand, the neoliberalism of APEC, GATT/WTO, and the radical domestic market reforms that have made the country one of the most deregulated economies in the world must be seen in the context of the ongoing colonisation of indigenous Maori lands, lives, resources and futures by the Crown.

Throughout, and beyond the Asia-Pacific region, many others have pointed out the parallels between the experiences of their peoples under colonial rule and those faced in the 1990s as a result of an insane, profit-driven top-down model of development imposed in the interests of a tiny minority of the world's population. And I do not think that it is coincidental that the USA, Australia, New Zealand and Canada, the countries which are leading the charge within APEC for further, faster, more comprehensive liberalisation are ones which continue to deny indigenous peoples in those territories rights to decolonisation and self-determination, at the same time as disguising this fact with mythical notions that coloniser governments in these countries are inherently humanitarian, democratic and forward-thinking. As Cree lawyer Sharon Venne says of NAFTA: "It is the same colonisation game - just with a new name."

NGOs, human rights, environmental and aid and development organisations in these countries concerned about the global effects of structural adjustment and an unjust economic order need look no further than their own backyard to see the impact and outcomes of the same philosophy at work. The commodification of peoples, knowledge, rights, and nature itself which underpins the APEC and WTO agendas, as well as the radical market policies of the "New Zealand experiment" can be sourced in the same unbalanced, short-sighted, arrogant and greed-driven worldview which characterises the coloniser's mindset.

Maori educationalist Graham Smith points out that "[H]istorically the same processes of commodification were used by Pakeha [European settlers] to access Maori land. This was achieved through the individualisation of Maori land titles i.e. to commodify or 'package up' what were collective or group held titles into individual holdings in order to facilitate their sale to Pakeha under Pakeha rules and customs."

In Aotearoa/New Zealand, the Treaty of Waitangi, signed between Maori and Crown representatives in 1840 affirmed Maori tino rangatiratanga - their sovereign right of self-determination - and allowed Pakeha (European) settlers to govern their own. Sovereignty was never ceded to the British Crown. Instead, as Simon Upton, former Minister for the Environment conceded: "[W]hatever legitimacy the Crown failed to derive from the treaty, it acquired through the effective and durable assertion of power. To not put too fine a point on it...the British Crown and subsequently the New Zealand Parliament, effected a revolutionary seizure of power." (The Press, Christchurch, 1/5/1995) He adds: "revolution rests upon what is done, not what is legal, or necessarily moral or just."

Successive New Zealand governments still refuse to honour the Treaty, but are far less reticent about making far-reaching international commitments without consulting Maori or non-Maori, in fora such as the GATT and APEC. With fundamentalist zeal, they ascribe enormous significance to OECD reports, market/economic indicators like Standard and Poors credit ratings, fiscal restraint measures and an ideology which excludes all social, cultural, and environmental considerations in favour of market mantras.

So the word "sovereignty" is one that should be used with a great deal of caution. Can a society based on the dispossession and systematic oppression of indigenous people, on a "revolutionary seizure of power", on the unrecognised, undervalued and often unrewarded labour of women, and the blood, sweat and tears of workers ever truly claim to be "sovereign"?

Eager to attract foreign investment and be seen internationally as a driving force in global economic integration, the New Zealand Government is guaranteeing open access to lands and resources that they themselves have no right to. The speed at which the government has deregulated the economy has outstripped the pace demanded by GATT and APEC. Maori lawyer Moana Jackson has described the Government as a "neo-colonial harlot", prostituting itself for the highest investment price. Unfortunately the assets with which it prostitutes itself belong to Maori."

Between 1988 and 1993, Aotearoa/New Zealand enjoyed the dubious distinction of leading the world in the sale of state-owned assets, often at bargain basement prices, to overseas investors, most of which are well-known transnationals. Some NZ $14 billion - or 3.6% of the annual GDP was sold off like this. The Economist magazine describes the neoliberal economic reforms as "out-Thatchering Mrs Thatcher". Other commentators have referred to this process as "revolutionary", or indeed, "Chile without the gun".

Upton and many other New Zealand politicians see no double standard in legitimising a colonial state based on revolution while attacking Maori who assert their right to self-determination and demand control over their resources and lands. It's hardly surprising then that they have no problem with pushing on with a relentless programme of selling off lands, resources and futures to transnational corporations for whom Aotearoa/New Zealand has become an unrestricted investment playground, and committing future generations of New Zealanders to this agenda while dressing this up as somehow guaranteeing greater political independence and enhancing sovereignty.

As assets, political and economic power were transferred from the Government to the private sector, especially to the transnationals, many non-Maori New Zealanders started to get a taste of the revamped laissez faire economics which was implemented without any democratic mandate from 1984 onwards. Concerns about foreign investment and the sale of so many assets have led many to talk about the loss of "economic sovereignty". The same kinds of policies which have long been used to subjugate indigenous peoples and the peoples of the South are now being imposed on increasing numbers of non-indigenous peoples in the so-called "First World". As decision-making powers are abdicated to international bodies and fora which have no accountability to ordinary citizens, and as people's destinies, living standards and environments are steadily remoulded to suit the interests and needs of transnational investors, a genuine sense of disempowerment and disenfranchisement is being felt.

Ordinary people, Maori and non-Maori alike, are supposed to take solace in the fact that all of this has been done to make us "attractive to foreign investment". There is nothing attractive about the end results. Stripped of almost all subsidies and import tariffs, and forced to compete in a global market dominated by immensely more powerful actors on a far from level playing field, whole sectors of New Zealand industries were decimated, with thousands of jobs lost. The voice of New Zealand big business, the Business Roundtable, and the neoliberal ideologues within Treasury were raised up as being the true visionaries of society. Tax cuts for the rich were accompanied by social welfare cuts for the poor. The public sector was attacked with great gusto and remodelled along market principles. The country's financial, media, transport, and communications infrastructure is largely in private/transnational hands.

By 1996, an estimated 1 in 5 New Zealanders lived below the poverty line. This figure was much higher for Maori and Pacific Island families. A 1995 Joseph Rowntree Foundation study found that among 18 comparable countries, between 1979 and 1995, Aotearoa/New Zealand had the fastest growing income disparity. The seemingly never-ending takeovers by transnationals did nothing to improve New Zealand's overseas debt problem. In 1984, total private and public foreign debt stood at $16 billion. In 1996, it is $74 billion - despite a decade of public asset sales and takeovers. Such cold realities are carefully glossed over in all of the hype surrounding free trade, but Maori Treaty activist and lawyer Annette Sykes attributes them to what she calls "the socially abhorrent principles of the structural adjustment programme" which has been imposed on all of us for over a decade. So much for the promises made about the "colossal", and "remarkable" benefits for us of the Uruguay Round and APEC that have been made in the past few years. We are repeatedly told to "leave it to the market to decide", and that the benefits of GATT will trickle down to us all. In reality, trade and investment liberalisation regimes like those promoted within APEC open the way for the sucking up of lands, lives and resources by corporations which cynically promote a destructive model of development which knows no limits in its lust for profit.

According to Prime Minister Jim Bolger: "There is no downside to opening up world trade. All you have to do is overcome political barriers, in other words, attitudinal barriers" These are the kind of glib assurances which we have become accustomed to hearing in relation to APEC. But increasingly, the hype and talking up of the supposed benefits of liberalisation have taken on an air of desperation, as many other economies continue to resist pressures to axe subsidies, tariffs and other forms of protection which the government proudly boasts of having removed.

Because of the history of colonisation in Aotearoa, it is somewhat difficult to talk of genuine economic sovereignty since Maori were deprived of their control over their resources by the settlers in 1840. As a British colony, New Zealand has always been controlled by external economic powers. So I have some problems with the use of the words "economic sovereignty". It would seem I'm not the only one. Former Prime Minister and Labour Trade Minister Mike Moore said of GATT in July: "Look, this has actually given us our economic sovereignty. Before, every couple of years, Europe would decide what was going to happen, and we'd be sitting outside the door, hoping the French and the Irish wouldn't hammer us and that someone would put in a good word. We can now take part in those trade decisions as a sovereign nation." (Sunday Star-Times, 7 July 1996). According to Mr Moore, economic sovereignty - indeed, sovereignty itself - can be reduced down to the possibility that more New Zealand exports may be able to gain access to international markets. A possibility which is hardly borne out by the duplicitous track record of powerful governments such as the USA in failing to adhere to the same overarching rules of global trade which it demands that every other country follows.

Many New Zealand politicians and business leaders openly advocate a national identity based on maintaining a regime on overseas investment best described as an open door policy, with no scrutiny or controls. In relation to APEC and GATT/WTO commitments, we are supposed to be proud to be "ahead of the game". This kind of sovereignty has little to do with people with whom it is vested, with political and democratic rights. With the fundamental and inalienable right of all peoples to self-determination. It has much more to do with selling "government of the transnationals, by the transnationals, for the transnationals" to the general public. This appears to be the '90s definition of sovereignty which we are being asked to accept. It is this kind of "sovereignty" that APEC, along with its partners in crime, the Bretton Woods toxic trio wants to lock us into forever. The term "free trade" is itself merely a euphemism for freedom from governmental restrictions for transnational corporations.

According to some New Zealand apologists for free trade, GATT has given consumers more "sovereignty". So apparently, sovereignty can also be reduced down to the range of choices at the shopping mall - never mind the high costs borne by local workers who are forced into unemployment as a result of the erosion of their jobs as the effects of cheaper imports began to bite deep. Never mind the fact that the products that are replacing local ones on the shelves at the shops may well be produced by workers forced to work in inhuman conditions in the free trade zones set up for the transnational robber barons. Without peoples' sovereignty, without constitutional arrangements which are based on solid and just foundations, without support for peoples' full economic political cultural and social rights, without participatory democracy, our line of defence against the onslaught of transnational capital will be very flimsy. The concept of sovereignty, both within Aotearoa and throughout the APEC region is one that needs careful examination and serious debate.

You cannot rebuild a house which has rotten foundations. The worldview that dominates the APEC process is fundamentally corrupt. APEC's very nature is one which rests on a narrow economic reductionist outlook. Firstly, economics is defined so as to exclude vast areas of human activity - those which do not contribute to GNP growth and all the other supposed "vital signs" of a "healthy" economy. And within that, peoples, natural resources, lands, even the air that we breathe are redefined within this narrow definition as tradeable commodities. In this brave new world, "economics" and trade issues are presented in such a way as to seem as alien and incomprehensible as possible to ordinary citizens.

As Vandana Shiva points out, all areas have become "trade-related". Nothing is off-limits. You can put the term "trade-related" in front of anything and draw the "areas of domestic decision making into the global arena." and create "areas where the 'darker', more visible, facets of free trade are tranformed into reasons for its justification and expansion" New Zealand journalist Bruce Ansley sums up the "brave new world" charted by APEC: "[I]n Apec language (as singular as Esperanto) nations become "economies" without, apparently, irritating social philosophies. These economies aren't inhabited by people but by "human resources". They don't have elected representatives; doubtless to his gratification, Jim Bolger becomes an "economic leader". It is cold and grey and mechanical, and scary as hell." (NZ Listener, 3/8/1996)

I do not believe that the answers to concerns about people-centred development, social justice and the environment can be developed within the framework which has already been largely mapped out by the main actors within APEC. These actors have been careful to exclude the rest of us from their deliberations and adoption of trade and investment measures. They have ignored the "non-economic" effects wrought by trade and investment liberalisation. Overtures towards "consulting" at least some NGOs and other actors in civil society will come from some bodies within APEC. These overtures should be treated with extreme caution. Grassroots peoples' struggles for democratic rights, genuine participatory democracy, and sane, just and sustainable models of development have their own dynamic and truths quite apart from the message that we are all being told in our respective countries to a greater or lesser degree that "there is no alternative" to trade and investment liberalisation.

We do not need APEC or the WTO to validate us by inviting us to their party. Jumping on board the APEC train and convincing ourselves that we can somehow change its course is delusory. It is likely to lead to co-option and division within peoples' movements and organisations.

We need to work locally, nationally, and internationally to resist and roll back the realities of corporate colonialism in this rapidly globalising world. There are chinks in the sometimes seemingly impenetrable armour of the transnationals and their agenda. Like the myths of colonisation, the emperor's new clothes of the free market need to be exposed to the light of day. They are actually so fragile that their exponents cannot afford the risk of exposure. That is why, in many nations around the world, those who dare to challenge the neoliberal model of development are vilified, treated like heretics, or even criminalised Open debate and even the mere suggestion that alternative models of economic and social development exist will not be tolerated. So it is vital to ensure that debate and action does occur, and that it reaches outside of conferences such as this out into the wider community.

In Aotearoa, Maori resistance to the latest wave of colonisation in the form of free trade, and their insistent demands for self-determination serve as a warning that a mere reversion to the kind of New Zealand "state sovereignty" based on invasion, injustice and dispossession is not a sustainable or just alternative to the free market agenda. Finding alternatives to and liberation from corporate rule and inhuman market models of development are to me inextricably bound together with the issue of support for indigenous sovereignty and a rebuilding of a worldview which is not underpinned by corporate greed. Unlike the free market model of development, which claims to be applicable to any sector, country or region and a panacea for all kinds of problems, there are many different alternative models to be explored in different contexts.

As the experience of many countries which were supposedly freed from colonial rule after long years of struggle shows, flag independence is not enough. The Bretton Woods institutions and the insatiable demands of big business have become the new colonial overlords. Next month's WTO Ministerial Meeting will seek to further prise open the world's economies - especially the weaker ones - to the demands of transnational capital. Without economic independence, what kind of independence can a country truly enjoy? If social, political, environmental, cultural and economic outcomes are decided by those acting in the interests of transnational business and international lending institutions, then have not societies and peoples merely become adjuncts to the corporate mission statement and balance sheet?

It is not enough to reject the free market vision as advocated by APEC and WTO and to seek to nostalgically return to a golden age of a strong nation-state. In much of the talk about economic sovereignty, whether it be at government, or global level, all-too frequently the work of women, the exploitation of workers, lack of government accountability, and the enormous contributions made by the innovations of indigenous peoples and peoples of the South are studiously overlooked. A true peoples' sovereignty cannot be based on the denial of sovereign rights of others.

The issue of trade and investment liberalisation will not go away. The social, environmental, cultural and political devastation which market-driven policies and international trade structures and processes causes will not go away. And opposition to free trade will not go away. At the end of the day, we should ask ourselves who we want to determine our futures and those of our children? The CEOs of transnational corporations? A set of global rules about trade and investment which reads like a corporate wish list backed up by the World Trade Organisation? Or our own communities?

Aziz Choudry is an activist with GATT Watchdog.

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