GATS and Democracy -- Introduction

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There is growing concern in Europe, as elsewhere, that the WTO's General Agreement on Trade in Services (GATS) represents the greatest threat to democracy to come from an international economic agreement since the Multilateral Agreement on Investment, defeated in October 1998. European Commission negotiators are proposing extensions to GATS which would fundamentally undermine citizens' right to determine their own social and environmental priorities for the future. In addition, they are pushing forward proposals which will not only have an impact on service delivery in Europe, but also put immense pressure on developing countries to liberalise service sectors of export interest to European companies.

As described in the articles below, current GATS negotiations on domestic regulation threaten to subordinate social and environmental policy goals to the commercial advantage of multinational corporations. There is considerable concern that GATS rules could now be applied to public goods such as education, health and water - key services which are considered too important to entrust to the WTO's free trade agenda.

Despite the potentially profound impact GATS will have, negotiations continue without national or European parliamentary scrutiny. In addition, the European Commission has been granted fast track authority for almost all service sectors at its Nice intergovernmental conference in December 2000. This widening of the democratic gap is aggravated by the fact that the Commission lends its ears more willingly to the chief executives and business interest groups of the continent's most powerful corporations than to truly concerned citizens.

GATS represents a particular challenge to democracy in that it offers countries few possible means of retracting their commitments. Any country wishing to withdraw a service sector commitment must wait three years from the time the commitment was first made, and then offer acceptable compensation to other WTO members before the withdrawal can be effected. In the words of David Hartridge, until recently Director of the WTO's Services Division, commitments made under GATS are effectively "irreversible".

Under GATS, therefore, it becomes practicably impossible for citizens of a country to reclaim basic public services once they have been liberalised, or to introduce new regulations on social or environmental grounds. Moreover, the WTO positively welcomes this anti-democratic aspect of GATS. In its own question and answer introduction to the Agreement, the WTO Secretariat recommends GATS to pro-liberalisation governments for the political assistance it can bring them in "overcoming domestic resistance to change".

This collection of articles from members of the Seattle to Brussels Network focuses on the threat to democracy represented by GATS. The articles have been contributed by individual member organisations and do not necessarily reflect the views of all members of the Network. At the same time, all members share the central conviction that there should be no further expansion of GATS without a full, public and independent assessment of the impact of further services liberalisation on democracy and people's rights. We call on the WTO Council for Trade in Services, meeting in Geneva from 9 to 18 July 2001, to initiate such an assessment.

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