International

the tyranny of free tradewasted natural wealth and lost livelihoods

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friends of the earth Friends of the Earth International is the world’s largest grassroots environmentalnetwork, uniting 71 diverse national member groups and some 5,000 local activist groups on everycontinent. With approximately 1.5 million members and supporters around the world, we campaign ontoday’s most urgent social and environmental issues. We challenge the current model of economic andcorporate globalization, and promote solutions that will help to create environmentally sustainableand socially just societies.

friends of the earth has groups in: Argentina, Australia, Austria, Bangladesh, Belgium, Belgium(Flanders), Bolivia, Brazil, Bulgaria, Cameroon, Canada, Chile, Colombia, Costa Rica, Croatia, Curaçao(Antilles), Cyprus, Czech Republic, Denmark, El Salvador, England/Wales/Northern Ireland, Estonia,Finland, France, Georgia, Germany, Ghana, Grenada (West Indies), Guatemala, Haiti, Honduras,Hungary, Indonesia, Ireland, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg, Macedonia (formerYugoslav Republic of), Malaysia, Mali, Malta, Mauritius, Nepal, Netherlands, New Zealand, Nicaragua,Nigeria, Norway, Palestine, Papua New Guinea, Paraguay, Peru, Philippines, Poland, Scotland, SierraLeone, Slovakia, South Africa, Spain, Sri Lanka, Swaziland, Sweden, Switzerland, Togo, Tunisia, Ukraine,United States, and Uruguay.

(Please contact the FoEI Secretariat or check our website for FoE groups’ contact info)

Published December, 2005 in Hong Kong. ISBN: 90-0914913-9.

editorial team Ronnie Hall (Friends of the Earth England, Wales and Northern Ireland), Damian Sullivan(Friends of the Earth Australia), Alberto Villareal (Friends of the Earth Uruguay), Simone Lovera (Friendsof the Earth International), Ann Doherty (Friends of the Earth International).

design Tania Dunster, KÏ Design, ki_designnl@yahoo.co.uk

printing Power Digital Printing Co., Hong Kong.

with thanks to Marc Allain (World Forum of Fish Harvesters and Fish Workers), Kokou Elorm Amegadze(Friends of the Earth Togo), Bente Hessellund Andersen (Friends of the Earth Denmark), Tatiana RoaAvendaño (Friends of the Earth Colombia), Javier Baltodano and Isaac Rojas (Friends of the Earth CostaRica), Alexandra Wandel (Friends of the Earth Europe), George Awudi Bright and Helen La Trobe (Friendsof the Earth Ghana), Aldrin Calixte (Friends of the Earth Haiti), Ingrid Gorre and Lodel Magbanua(Friends of the Earth Philippines), Eve Mitchell (Friends of the Earth England, Wales and NorthernIreland), Meenakshi Raman (Friends of the Earth Malaysia), P. Raja Siregar (Friends of the EarthIndonesia), Markus Steigenberger (Friends of the Earth Germany), Sebastian Valdomir (Friends of theEarth Uruguay), David Waskow (Friends of the Earth United States).

International

friends of the earth international secretariat

P.O. Box 191991000 GD AmsterdamThe NetherlandsTel: 31 20 622 1369Fax: 31 20 639 2181E-mail: info@foei.orgWebsite: www.foei.org

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one biodiversity 9

executive summary 4introduction 5making sense of the wto doha round negotiations 7

two fish 14

introduction trade, fish and people’s livelihoods 14fish and folk threatened by liberalization in the seychelles 15privatizing fish harms the public good: lessons from canada 16opening markets punishes indonesian fisherfolk 17fishing: a dying tradition on the philippine islands 17

three food 18

introduction food, seeds and free trade 18bacon and beans: how trade in pork and soy causes hunger,pollution and human rights violations 19genetically modified versus organic food: how the wto meddles in what we eat 21indonesian farmer sued by seed company 21molino santa rosa: production for and by local people in uruguay 23colombian agriculture and the andean free trade agreement 23

four water 24

introduction water: human right or commodity for trade? 24water woes in togo 26people’s water power in uruguay 27

five minerals 28

introduction diamond rings or community welfare? how the international mineral trade harms communities and environments 28ghana, gold and trade liberalization 29mining frenzy in the philippines 30

six desertification 31

introduction trade, desertification and livelihoods 31expanding trade, expanding deserts in ghana 32small island states, food imports and desertification 32

seven energy 33

introduction energy, trade and climate change 33dark days of energy privatization in colombia 34

conclusion 35

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introduction biodiversity for sale: trade undermines indigenous and community rights 9the privatization of traditional knowledge, seeds and medicines 11trade liberalization and forests in central america 12trading away forests in indonesia 13

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These are critical times for environmental and socialmovements around the world.

Current and proposed trading arrangements are facilitatingdaylight robbery, with millions of already impoverished peoplelosing their livelihoods and natural resources in order to enrichthe wealthy. Those on the losing end include farmers, fisherfolk,women, indigenous peoples and literally millions of othersaround the world who depend on environmental resources inorder to survive. Those on the winning end include corporationsand those governments that profit from the drive to liberalizemarkets and privatize natural resources.

This publication exposes the danger that current tradenegotiations pose to people and their environments around theworld. The privatization of forests, traditional knowledge, seedsand medicines undermines indigenous and community rights, asshown by case studies from Central America and Indonesia (seepages 12 and 13). The 40 million small-scale fishers who dependon the ocean’s resources to feed their families could be out-competed if the WTO cuts tariffs in fisheries as proposed, enablingcommercial trawlers to further deplete marine resources, asexamples from the Seychelles, the Philippines Islands andIndonesia make clear (see pages 15 and 17).

Small farmers, particularly in developing countries, are being hurtby inequitable trade rules that allow the dumping of productsfrom rich nations, undercutting the value of their local crops. Theyareoften forced from their land when it is converted to plantationsor planted with crops for export. The pig industry in Denmark, forexample, is responsible for the damaging spread of soy

plantations in Latin America, and poverty levels in fertile Colombiahave skyrocketed with the opening of markets and tariffliberalization (see pages 19 and 23).

Trade agreements are also being used to pry open water andenergy markets, which could well decrease people’s access tothese essential resources, as exemplified by the privatization ofwater and energy supplies in Togo (see page 26) and Colombia (seepage 34). The negative consequences of the liberalization of themining industry are being felt by indigenous peoples andcommunities in the Philippines and Ghana, among many otherplaces. The effects of climate change and desertification, two ofthe most serious environmental threats to the planet, willcontinue to manifest themselves and impact the world’s mostmarginalized people as more trade agreements are cemented.

Today, the World Trade Organization and regional trade agreementsare on shaky ground, thanks to the massive outrage that theirpolicies continue to invoke around the world. The people ofUruguay, voted in 2004, for example, to establish water as a basichuman right and to put a stop to the privatization of the country’swater resources (see page 27). Many clear alternatives to tradeliberalization exist, including small-scale fisheries like the one in theCanadian Atlantic (see page 16), and support for local farmers andmarkets, as can be seen in Uruguay’s Santa Rosa mill (see page 22).

Friends of the Earth International believes that the days ofunfettered free trade – and the environmental and socialdevastation left in its wake – are drawing to a close. We are proudto be part of local and global movements working to develop fairand sustainable economies.

executive summarymeena raman, friends of the earth international chair, malaysia

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The Millennium Ecosystem Assessment recognizes that “thedegradation of ecosystem services is harming many of theworld’s poorest people and is sometimes the principal factorcausing poverty.” “The Wealth of the Poor: Managing Ecosystemsto Fight Poverty”, a recent report from the World ResourcesInstitute, the World Bank, the United Nations EnvironmentProgram and the United Nations Development Program, alsoargues that natural resources represent a route out of poverty forthe impoverished: “Three-fourths of them live in rural areas;their environment is all they can depend on. Environmentalresources are absolutely essential, rather than incidental, if weare to have any hope of meeting our goals of poverty reduction.”

just more pretty words?

Have any World Trade Organization (WTO) negotiators readthese reports? One could be forgiven for assuming they havenot. The WTO’s current trade negotiations include proposals tocompletely liberalize markets in forest products, fish and fishproducts, gems and precious metals, primary aluminum, andoil, with barely a mention of the potential and possiblywidespread environmental and social impacts that this couldhave. Markets in energy exploration and distribution, waterextraction and distribution, and the management of naturalparks (including in biodiversity hotspots) are all also on thetable, as are inconvenient environmental and health and safetystandards and the fate of critical multilateral environmentalagreements. The WTO’s existing Trade Related aspects ofIntellectual Property Rights agreement (TRIPs) is preventing

people’s access to and use of the natural resources on whichthey have traditionally depended.

The livelihoods of literally millions of people are at stake.Women are especially vulnerable since they rely more heavily onaccess to natural resources and land for food, medicines andfuel for their families, and are responsible for resourcemanagement and food production in many cultures.

unfair trade harms small farmers

Current trade rules and negotiations are generating increasinglyinequitable terms of trade for small farmers worldwide,especially in developing countries where up to half thepopulation may be engaged in agriculture. These rules are forcingdown farm-gate prices (although in-store prices often stay justthe same), whilst allowing industrialized countries to continue tosubsidize their products and dump them in southern markets,undercutting local producers. Increasing agricultural exports arealso worsening desertification, which has long been recognizedas a major environmental problem, with adverse impacts on thelivelihoods of people in affected areas around the world.

fish and forests suffer from tariff reductions

Fisheries and forests also provide livelihoods and essentialnutrition and medicines for millions across the world. Ninetypercent of fishers worldwide – nearly 40 million people – areemployed in small-scale artisanal fishing, and these men andwomen are overwhelmingly poor. A further 13 million are

introductionronnie hall, friends of the earth england, wales and northern ireland

“Prudence must be shown in the management of all living species and natural resources, in

accordance with the precepts of sustainable development. Only in this way can the immeasurable

riches provided to us by nature be preserved and passed on to our descendants. The current

unsustainable patterns of production and consumption must be changed in the interest of our

future welfare and that of our descendants.”United Nations Millennium Declaration, 2000.

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employed in the formal forestry sector, and 350 million relyalmost entirely on forests for their livelihoods and income (forcollecting fuelwood, medicinal plants, and food, for example).WTO proposals to fully eliminate tariffs in both of these sectorscould have extremely serious consequences for these people,including loss of access to and destruction of the naturalresources on which they traditionally depend.

The tariff reductions currently proposed would increaseincentives to fish internationally, especially for large commercialtrawlers, fuelling the continued exploitation of an alreadyseriously depleted resource. Local fishers and poor fishingcommunities would increasingly suffer the impact of dyingseas, as large commercial fleets take many of the highestquality fish. There is also a risk of cheap fish imports beingdumped in coastal nations with strong domestic markets,making it impossible for fishers to sell their catch locally.Similarly, in the forest sector, an impact assessment preparedfor the European Commission states that developing countrieswith forest industries protected by high tariffs could “incurconsiderable environmental and social costs due to downsizingof the industrial capacity and closing some industries entirely.”

diverting water to the wealthy

Regional and bilateral trade agreements are even worse than theWTO. New agreements in Central and Latin America, for example,are opening up underground water systems to powerful foreignbottled water and beverage companies. This will in all likelihoodreduce local peoples’ access to these important water resources.

Overall, 70% of the world’s water is now used for irrigation (and60% of that is wasted), 22% is used by industry and just 8%remains for human consumption. Contrast this with the fact thatone billion people – one in every six people on the planet – lackaccess to safe drinking water, and 2.4 billion still have no toilets orother forms of improved sanitation.

trade and climate, a dangerous mix

Furthermore, climate change, one of the most seriousenvironmental threats facing the world today, could beworsened by current trade liberalization negotiations. Tradeagreements and institutions such as the WTO have the very realpotential to undermine both national and international actionto address climate change through powerful mechanisms torestrict even those government actions legitimately designed tolimit climate emissions.

At a national level, trade agreements could limit the policy spacegovernments have to reduce national greenhouse gas emissions.For example, trade rules could limit the use of a host of policiesdesigned to promote sustainable domestic industries. Tradeagreements could also force governments to abandon laws or

regulations designed to reduce dependence on fossil fuels.International trade agreements, including the WTO, could alsotake precedence in disputes with the Kyoto Climate Protocol, anddefine how emissions trading schemes operate.

but another world is possible

We do not have to continue down this road. Some far-sightedjoined-up thinking could go a long way in reversing current trends,if only trade negotiators and their governments could finally bepersuaded to think outside of the ‘trade negotiations’ box.

International trade needs to be recognized for what it is: ameans to an end. A coherent system of global governance inwhich trade regulation was firmly embedded in an improvedUN system could significantly improve coordination and help tostop trade negotiations from undermining efforts to eradicatepoverty, protect biodiversity, prevent climate change and ensurefood sovereignty, at both the national and international level.Importantly, the myth of unfettered free trade as a solution topoverty needs to be exploded.

Recognition of the role that our natural heritage plays in povertyeradication must be extended from the United Nations to the WTO.Governments need to stop and review the real impacts that theDoha Work Program could have on the world’s most impoverishedpeople and the environment upon which we all depend. We cannotcontinue to work towards the Millennium Development Goals onthe one hand while undoing all efforts through the WTO and otherfree trade agreements with the other hand.

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Trade talks might seem far away from our lives, but they have avery real impact on how we live and on our surroundingenvironment. The current negotiations in the World TradeOrganization, the body that governs world trade, could (ifconcluded) increase pressure on our natural environment,reduce impoverished countries’ ability to develop, and affect thelivelihoods of small farmers and fisherfolk around the globe.They could also reduce national governments’ ability toimplement domestic laws and regulations to protect theenvironment and local jobs and promote health and safety.

The WTO’s ‘Doha’ negotiations (so called because they wereinitiated at the WTO’s 4th Ministerial in Doha, Qatar in 2001)focus on agriculture, industrial products and raw materials,services and intellectual property rights (the ownership ofideas). Industrialized countries promised developing countriesthat the Doha ‘Work Program’ and other trade negotiationswould focus first and foremost on development issues. Inreality, it is increasingly clear that the negotiations threaten toundermine development, the environment, and the livelihoodsand employment of tens of millions of people. In addition, manydeveloping country proposals relating to development (focusingon special and differential treatment and implementationissues) are being consistently ignored. Because the talks coverso many areas they are frequently difficult to follow, even fortrade negotiators themselves. This can put many developingcountry governments, who have only one trade negotiatorpresent in Geneva, in a very difficult position.

Governments tend to refer to the Doha talks as a ‘round’because all the negotiations are supposed to be completed atthe same time (the idea is that countries’ losses in one sectorwill be made up by gains in another). However, what this meansin practice is that countries are forced to make trade-offsbetween different negotiating areas. So developing countriesmight be persuaded, for example, to open up sensitive publicservice and natural resource-based sectors if they thought itwould bring export opportunities in agriculture. In addition,smaller countries are often put under extreme pressure toliberalize in a range of sectors that they do not want to open up.

A major problem with the WTO is its decision-making process.In theory, decisions are supposed to be made by consensus.However, there is evidence of a great deal of arm-twistingbehind the scenes. More powerful countries such as the EU, theUS and Japan exert whatever influence they can to open upmarkets for powerful corporate lobbies based in their countries.Furthermore, smaller countries are often excluded from keynegotiations until the deals have been done, and are expectedto sign up afterwards.

Key aspects of the Doha round include:

Non-Agricultural Market Access (NAMA) negotiations, whichare focused on reducing tariffs in all goods that are not includedin the agriculture negotiations. NAMA includes proposals thatfocus on natural resource-based sectors including minerals,forest products and fisheries.

Tariffs are the taxes countries place on imports and exports. Theyprovide a means for developing countries to protect andpromote domestic industries and local employment (especiallysince they cannot afford to do this using subsidies). Tariffs helpto protect small farmers and fisherfolk who are essential to localeconomies and societies but may be unable to compete withhuge transnational corporations. Tariff cuts are also likely to leadto increased forest destruction across the globe, the furtherdepletion of dwindling fish stocks, and increased mining.

NAMA negotiations may also be used to restrict the ability ofgovernments to legislate and regulate at the national level.Friends of the Earth International has identified 212 laws andregulations relating to the environment and health standardsthat have been notified by governments as barriers to trade.

The Agreement on Agriculture (AOA) tends to always be at thecentre of WTO negotiations as this is the key sector in whichdeveloping countries think they might gain something.

making sense of the wto doha round negotiationsdamian sullivan, friends of the earth australia and ronnie hall, friends of the earth england, wales and northern ireland

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bureaucrats at their side, the EU and US are often able to makeit look as if they are reforming their agriculture policies whenthey are not making any substantial changes.

The General Agreement on Trade in Services (GATS)negotiations are of special interest because they relate to someof the essential aspects of life: water, energy, health andbiodiversity (all of which are proposed for market opening).Services negotiations have proceeded very slowly because manycountries do not want to open up these services, many of whichare currently publicly provided. In GATS, countries currently havemore flexibility about what they are willing to negotiate on,although the EU tried to reduce this flexibility by requiring a setnumber of sub-sectors to be included by each country. GATS alsoincludes negotiations on domestic regulation, which could limitgovernments’ ability to implement national policies.

The Trade Related aspects of Intellectual Property Rights (TRIPS)Agreement is also up for review. TRIPs works very much in favorof Northern transnational corporations and was initiallyincluded in the WTO’s agreements at the insistence of the US. Itobstructs people’s access to essential medicines, seeds and vitalnecessities, by increasing and even introducing costs. It also

Most developing countries want more access to markets in theEU and the US. At the WTO’s 2003 Ministerial in Cancun, anumber of the major developing countries united in a groupcalled the G20, which was strong enough to resist pressure fromthe EU and the US and insist that developing countries weren’tbeing offered enough. This was an important step, even thoughit has become increasingly evident that the G20 consists ofcountries with strong transnational agribusiness interests (suchcompanies are likely to be the primary beneficiaries of increasedexports). The G20 includes Brazil and India.

Many also want to use the negotiations to ensure that theirsmall farmers and rural communities are protected. They wantthe EU and US to reduce farming subsidies, and they want to beable to use trade restrictions to keep subsidized products out oftheir own markets. Countries focusing on keeping products outare grouped together in the G33, coordinated by Indonesia.These countries are less influential and more likely to findthemselves excluded from important negotiations.

A further group consist of some of the smallest countries thatare worried that the special trade agreements they already havewith particular partners could be eroded if other developingcountries start to get more market access (this is known as‘preference erosion’).

The EU and the US want to lever open developing countryagricultural markets while maintaining the huge subsidies theypay to farmers in their own countries - most of which go toagribusiness, not small farmers. With hundreds of trade

promotes the patenting of life forms, leading to the destructionof biodiversity and the appropriation of traditional knowledge.

African countries are currently seeking to remove the TRIPsrequirements relating to patents on life (although theirproposal does not exclude from TRIPs all other forms ofintellectual property rights). A further group of developingcountries, led by India, is also seeking amendments to the TRIPsAgreement to prevent biopiracy, which would allow developingcountries to benefit financially from the use of traditionalknowledge and biodiversity (although this would notnecessarily or automatically conserve and protect thatknowledge and biodiversity).

Trade and the environment is also a formal negotiating area in theDoha Work Program. Paragraph 31(i) of the WTO Doha MinisterialDeclaration may allow the WTO to set limits on the extent to andthe way in which governments can implement multilateralenvironmental agreements (MEAs). These negotiations have so farbeen very technical, but could nevertheless have extremelyimportant consequences for MEAs. The WTO might limit the useof those trade measures left to the discretion of MEA members.

Paragraph 32 of the WTO Declaration deals with environmentalgoods and services. Environmental goods are not yet defined,and tend to focus on products that northern corporations wantto export. They could include, for example, nuclear power plantsand waste incinerators. Environmental services proposed forliberalization also tend to focus on end-of-pipe technologiesonly (pollution-abating technologies, for example).

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part one | biodiversity

one biodiversity

biodiversity for sale:trade undermines indigenousand community rights simone lovera, friends of the earth international

Recognition of and respect for the rights of indigenous peoplesand local communities regarding the forests and otherecosystems they live in is a pre-condition for sustainabledevelopment. It is also widely recognized nowadays thatindigenous peoples and local communities are very effectivemanagers of the surrounding natural resources.

community-based ecosystem management

In countries such as Colombia, large biodiversity-rich areas likethe Amazon forest have been handed over to indigenouspeoples. It has been acknowledged that these peoples’traditional knowledge and methodologies are preservingbiodiversity in a much more effective manner than are theartificial management plans drawn up in distant environmentalministries and conservation institutions.

Likewise, it is broadly recognized in international instruments -like the Convention to Combat Desertification, the RamsarConvention on Wetlands, and the Biodiversity Convention - thatcommunities need to participate fully in the management oftheir ecosystems, if such management is to be equitable andeffective. This is particularly important for women, who dependeven more than men on resources such as fuelwood, freshwaterand medicinal plants. Women are recognized as very importantbiodiversity managers, including in the BiodiversityConvention’s preamble.

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one biodiversity

It is for these reasons that more and more governments andconservation institutions are implementing policies and projectsthat encourage community-based management of ecosystems.As well as handing over large tracts of land to indigenouspeoples, they are putting in place various incentive structures tostrengthen community governance over natural resources. Theyare also supporting the need for more attention to be paid to therole and needs of women in natural resource management.

trade could undermine rights

However, there is a serious risk that trade agreements promotedby the World Trade Organization will undermine many of thesepolicies. For example, the European Union is including“landscape and ecosystem management services” as a sector tobe liberalized under the General Agreement on Trade in Services(GATS, see page 8). The EU has requested such liberalizationfrom numerous countries including Argentina, Australia, Brazil,China, India, Kenya, the Philippines and South Africa. All of thesecountries have important indigenous populations, and many ofthem have specific laws and policies to give indigenous andother communities priority rights regarding the managementof forests and other ecosystems.

However, if these countries accept the EU’s proposals, foreigncompanies and/or conservation organizations could enter anddemand equal rights to access and manage these naturalresources. Giving priority rights to indigenous peoples and localcommunities would be classified as being “discriminatory”towardsforeign “competitors” in the “ecosystem management market”.

This may seem far-fetched, but regretfully it isn’t. This newtrend towards market-based conservation mechanisms – suchas eco-tourism, carbon sinks and biodiversity offsets - has madeit more and more attractive for large companies and profit-oriented conservation organizations to “invest” in themanagement of protected areas and other preciousecosystems. They may thus argue that they have been“discriminated against” if the management of a protected areais put in the hands of a local community.

additional threats posed by nama and trips

Other important threats to the rights of indigenous peoples andlocal communities are posed by negotiations on Non-Agricultural Market Access (NAMA). For example, export banson raw logs, which were put in place to address the almostincurable problem of unsustainable and often illegal logging incountries such as Indonesia, would be made impossible ifcurrent NAMA notifications were accepted. It is also possiblethat regulations to protect local communities and indigenouspeoples against the social and environmental impacts of large-scale mining and logging could be challenged by multinationalcompanies as unjustified barriers to trade and investment.

Add to that the devastation of traditional knowledge caused bythe WTO Trade Related aspects of Intellectual Property Rightsagreement (TRIPS, see page 8) and the destruction of forestsand other ecosystems caused by large-scale soy expansion andother monocultures promoted by the Agreement on Agriculture(see page 7), and it is clear that indigenous peoples, localcommunities, and the ecosystems they have been managing forgenerations have nothing to gain from the so-called ‘DohaDevelopment Agenda’.

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*the privatization of traditional knowledge, seeds and medicines [simone lovera, friends of the earth international]

Cultural and biological diversity areintrinsically linked. Many culturalexpressions and traditions have theirorigin in people’s natural surroundings,while different peoples have also createda wide diversity of landscapes andagricultural crops.

Furthermore, traditional knowledgeabout ecosystem management and plantbreeding plays a very important role inbiodiversity conservation and sustainableuse. Over the past centuries, women andmen created a rich variety of food andother agricultural crops through sharingseeds and knowlege. At one time therewere over 7,000 varieties of rice inIndonesia alone. Indigenous peoples andtraditional communities also tend to haveextensive knowledge about the medicinalplants in their surroundings. For many ofthe world’s most impoverished people,these plants are the only medicine theycan afford: it is estimated that 80% of allAfricans depend almost completely ontraditional medicinal plants for theirhealth care, for example.

traditions being tripped up

However, these traditions are currentlythreatened by the WTO’s Trade RelatedIntellectual Property Rights agreement(TRIPS), similar intellectual propertyrights (IPR) clauses in regional andbilateral trade agreements, and so-calledsystems designed to ensure access toand equitable sharing of geneticresources. Through these variousagreements, industrialized countries, ledby the United States, are trying toimpose a very rigid system of IPRs upondeveloping countries. This forcesdeveloping countries to accept andrespect patents and other IPRs grantedby northern patent offices, which havelittle interest in either the developmentneeds or the rights of indigenouspeoples, farming communities andpeople in developing countries.Developing countries are also beingforced to expand their own IPR systemsto cover seeds and related knowledge.

The results are devastating. Patents andother forms of intellectual propertyrights are totally inadequate for thesetraditional forms of innovation. Northerncountries tend to have little respect forthe fact that traditional knowledge was,is, and continues to be shared bycommunities and generations, so it cannever be claimed as property. In aclassically neo-colonial style, they haveallowed their industries to apply forpatents on seeds and traditionalmedicines that were “discovered” byindustries in the North after having beendeveloped by communities in the South.Trade agreements are used to ensure thatthese intellectual property restrictionsalso apply in southern countries.

This leads to situations in which thefarmers and traditional healers thatoriginally developed seeds andtraditional medicines can be preventedfrom using them for free, as this would“infringe” upon the patents ofcompanies like Monsanto, Bayer andMerck. Women are no longer able to usethe agricultural varieties they havedeveloped, and indigenous peoplescannot use the traditional medicinesthey have used for centuries. Add to thatthe devastating impacts of patents onthe prices and accessibility of regularmedicines like AIDS blockers and

vaccinations, and it becomes clear thatTRIPs is one of the greatest threats tohuman health and food sovereignty andsecurity the world is currently facing.

For years, developing countries havepointed out these gross injustices. Somedeveloping countries are now demanding,as a minimum, that TRIPs be reviewed andthat patent offices be obliged to disclosethe origin of the plant varieties andmedicinal plants that pharmaceuticalcompanies and seed giants try to patent.This would make it easier for developingcountries to track whether these varietiesare traditionally used or were invented bytheir farmers and healers, and thusdemand payment from the companieswanting to patent them.

Other developing countries, particularlyin Africa, have gone further anddemanded an end to patents on lifeforms, though not on all forms of IPRs.They point out that abolishing patentson life is a precondition for combatingthe practice of so-called “biopiracy”, theexpropriation and exploitation of therich African heritage of traditional seedsand medicines by northern corporationsand northern-driven trade agreements.

Friends of the Earth International is callingfor governments to amend all relevantinternational agreements so that countriescannot be forced into introducingintellectual property rights on life forms.Governments also need to fully protectfarmers’, indigenous peoples’ and localcommunities’ rights to their traditionalresources and knowledge, in particularallowing farmers to conserve, exchangeand reproduce seeds. Public access tomedicines and governments’ rights toregulate to protect people and theenvironment must be guaranteed as well.

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*trade liberalization and forests in central america[javier baltodano and isaac rojas, coecoceiba/friends of the earth costa rica]

There are a host of ongoing tradenegotiations and agreements betweenLatin American countries and the UnitedStates and other developed countries thatare likely to have negative impacts onforests. For example, the Free TradeAgreement between Central America, theUnited States and the Dominican Republichas a number of specific provisions thatwill impact negatively on forests.

Firstly, signatory governments arecompelled to introduce intellectualproperty rights protection for plants. Thisplaces pressure on forests, which are richin biological diversity and likely to be thetarget of companies seeking new geneticmaterial. Secondly, the agreement willlead to increased infrastructure, such asroads, hydroelectric plants and largetourism developments, to satisfy theneeds of incoming corporations andinvestors. This will also contribute to thedestruction and degradation of forests.Thirdly, in Costa Rica, the agreementwould mean that the current Forest Law,which regulates all extractive and tradeactivities taking place in the forest,would have to be revoked, as would thehuman rights component of this lawwhich allows anyone to speak up for theneed to protect forests. Finally, bio-prospecting could be regulated underthe agreement by a range of specificprovisions benefiting prospectors,including an “expropriation” clause thatallows companies to sue for lost profits iftheir activities are restricted (even forenvironmental reasons).

frustrating community management

Trade liberalization as presented in suchfree trade agreements favors internationaltrade above local trade, and facilitates theoperations of large corporations wantingto invest in and sell forest resources.

Free trade agreements put pressure ontraditional community and artisanalpractices relating to the use of resources,including community forest management,which is generally developed on a smallscale to satisfy local markets. In Costa Rica,peasants, environmentalists and indigenousgroups have proposed schemes to producethe amount of wood required in the countrythrough practices that respect the forestand ensure a fair distribution of the wealthgenerated. Such techniques have difficultiessurviving competition from incominginvestors. Corporations use the forest’sresources in a much more destructivemanner even when they do operate withinregulatory and legal frameworks, relying onheavy machinery and generating seriousnegative impacts on ecosystems.

monocultures destroying diversity

Free trade agreements are also linked tothe expansion of tree monocultures. Inorder to manage significant quantities offorest resources, corporations havehomogenized, standardized and simplifiedtheir operations. Monocultures, includingtrees for wood production, paper or carboncredits, and soy, banana and pineappleplantations, are a key component of thisapproach. Monocultures destroy hugeswathes of forest, provoke or worsen landconflicts, and thwart local land distributionprocesses and agrarian reform in the‘developing’ world.

Free trade agreements are based on aneconomic model that promotes thefunctioning of international markets and status of foreign investors. They are the laststage of a neoliberal scheme that, since the1980s, has been responsible for thedisappearance of local markets, small eco-agricultural initiatives, and food security inmany countries. Small farmers, whosepractices ensured the diversity of systemsand the stability and sustainability ofspecies, have seen their land and localforests being taken over by large banana,orange and pineapple plantations.

getting worse under nama

Recent moves in the World TradeOrganization to pursue the liberalization ofwood and forest products though the Non-Agricultural Market Access agreement(NAMA, see page 7) will likely place furtherpressure on forest resources in CentralAmerica. Big corporations will have greateraccess to local markets, placing morepressure on community-based forestmanagement initiatives. At the same time,demand for large-scale plantations is likelyto increase, accompanied by the necessaryclearing of land and the heightened use of chemicals.

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*trading away forests in indonesia[friends of the earth england, wales and northern ireland and walhi/friends of the earth indonesia]

“This forest was previously used for farming, hunting, collecting rattan, fruits, timber from the forest,

and fishing in the streams. Now the forest is gone, there are no animals to hunt.”Angkasa villager, Indonesia (Human Rights Watch, 2003).

Indonesia contains 10% of the world’sremaining tropical forest cover, and ishome to many threatened speciesincluding the Orangutan, the Sumatrantiger, the Sumatran rhino and the Asianelephant. Indonesia is also an importantcenter of genetic variation for tropicalfruit trees, including mango, breadfruitand durian, and its forests store largequantities of carbon.

Deforestation, forest degradation andhabitat fragmentation are significantproblems in Indonesia. More than 70% oforiginal frontier forests have been lost,and over half of those that remain areunder threat. The rate of forest loss isaccelerating: the current deforestationrate is 2.8 million hectares per year, 1.27times the rate of five years ago, andalmost four times the rate in the 1980s.

root causes of forest loss

Although the causes of deforestation inIndonesia are many and various,increased export trade has played a keyrole. Alongside population growth,political and economic instability, climatefactors and increased agriculturalproduction and resettlement,inappropriate government policies havepromoted the unsustainable expansionof forest industries. Forest products tradedoubled in 20 years from about 0.3 billioncubic metres per year in 1980 to over 0.6billion cubic metres in 2000.

The importance of international trade hasincreased year by year. In 2001, the exportvalue of forest products, the majority ofwhich were harvested from natural forests,accounted for US$4.45 billion, representing10.2% of the total value of Indonesianexports. Indonesia exports a range of forestproducts to countries including China,Japan, the Republic of Korea, the UnitedStates and the European Union. Logs fromIndonesia are also smuggled tointernational markets in trading centressuch as Malaysia, Singapore and China.

problematic plantations

Plantations have also become a majorsource of wood supply for the Indonesianforest industry. Large-scale plantationowners have turned to the use of fire as acheap and easy means of clearing theland in order to plant palm oil, rubber, andother export crops. Natural forest fires arerare in Indonesia, but the past decade hasseen an unprecedented increase in firesresulting from human activity.

nama could turn bad to worse

The WTO’s Non-Agricultural MarketAccess negotiations (NAMA, see page 7)are likely to lead to decreased tariffs inwood, forest and paper products. Inaddition, NAMA could lead to theremoval of legitimate national laws andregulations related to wood products,which would create further pressure onforest resources.

The European Commission’s 2005Sustainability Impact Assessment of theproposed WTO negotiations in the forestsector states that: “Indonesia’s forestsector suffers from serious sustainabilityproblems. Trade liberalization, or almostany measure that would increase theforest products production from currentlevels, would likely have primarilynegative sustainability impactsamplifying the current negative trends.”

In Indonesia, the expansion of export-oriented agriculture is also a major causeof deforestation and forest degradation.The negative impacts of agriculturalliberalization on forests are pronounced,and according to some assessments,could even exceed the impacts of forestproduct liberalization.

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part two | fish

14 | foei

two fish

The fishing industry provides livelihoodsand essential nutrition for millions ofpeople across the globe. Fish account forover 15% of animal protein intakeglobally, and is an important factor innational food security for manydeveloping countries. Furthermore,developing countries provide 70% of allof the fish consumed by peopleworldwide, although most of it ischanneled to wealthy nations. Ninetypercent of fisherfolk worldwide – nearly40 million people – are employed insmall-scale artisanal fishing and areresponsible for 45% of global fishproduction. However, these small-scalefisher men and women areoverwhelmingly poor.

trade, fish andpeople’s livelihoods david waskow, friends of the earthunited states

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Meanwhile, fishing stocks are being depleted globally due toincreased fishing by fleets from industrialized countries, someof which have commercial agreements with developingcountries to fish in their waters. Although fish capture from thewild has stagnated in the past ten years, even decreasing in thelast recorded years (2001-2002), the world’s supply of fish isnearly exhausted, with over 70% of wild fish stocks fullyexploited, overexploited, or depleted, Any additional overfishing- which could be triggered through trade liberalizationagreements - will cause species to become commercially extinctand seriously hinder the process of their regeneration.

trade liberalization hurts fish and people

Proposals put forth in the WTO’s NAMA negotiations (see page7) to eliminate tariffs on fish and fish products will have seriousnegative impacts on both fish and fisherpeople. Almost 70% oftradable fish is still obtained from wild harvest, which alreadyplaces extreme pressure on the oceans’ resources. The proposedtariff reductions in the NAMA negotiations will increase

incentives to fish internationally, especially with largecommercial trawlers, in turn fuelling further exploitation. Ifcoastal nations with strong domestic markets such as Ghanaand Cameroon are forced to lower tariffs under liberalization,the likelihood exists that imports could be forced upon them,undermining local fishing industries and food security.

Artisanal fisheries are more rational and equitable thanindustrial fishing fleets in their exploitation of fish resources.The cumulative loss of local ecological knowledge will seriouslyundermine the appropriate management of fish resources.Small-scale fishers will lose their livelihoods as the decline offisheries accelerates and as large commercial trawlers suck upall the high-quality fish for export. Only low-quality fish will beleft for artisanal fishers to feed their communities.

This will have serious financial reverberations in many developingcountries, where fishing is an important revenue generator forfishers and their family members, who are often indirectlyinvolved in the process. Ultimately, local fisherfolk and poorfishing communities will be the first to suffer from dying seas.

*fish and folk threatened by liberalization in the seychelles[friends of the earth united states]

Fishing is a key industry in the Seychelles,particularly because of the country’sextremely large Economic ExclusiveZone. Fourteen percent of the populationworks in the fish sector, over half of themin the tuna cannery owned by IndianOcean Tuna Ltd (in turn partly owned bythe US food giant Heinz).

The Seychelles earns a considerableamount of foreign income by sellingfishing licenses for its waters. The EU, inparticular, pays the Seychelles 2.3 millioneuros per year for fishing access, andcontributes another 3.48 million eurosthrough general expenditures. The EU isalso the largest importer of canned tunafrom the country. This lucrativepartnership is made possible bypreferential treatment from the EU,which allows duty-free imports so longas certain Rules of Origin are adhered to.

Liberalization of the global fisheriessector through NAMA (see page 7) woulddevastate the Seychelles’ economy, as thecountry would lose its desperatelyneeded preferential treatment andprobably Indian Ocean Tuna as well. Iftariffs go, the country also stands to lose70% of its total customs revenue andcould experience increased dumping offish on local markets. The Seychellesmight try to compensate by selling morefishing licenses to foreign fleets, leadingto further exploitation of its alreadyfragile marine resources.

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*privatizing fish harms the public good: lessons from canada[marc allain, policy advisor, world forum of fish harvesters and fish workers]

What happens when you establishprivate property rights in a fishery and letthe market decide who should own theright to fish?

Fishing communities, traditional fishingfamilies and conservation all lose out. Atleast that’s what the Canadianexperience shows.

In the mid-1990s, Canada’s Departmentof Fisheries and Oceans decided thatestablishing private property rights andallowing the concentration of ownershipwas the most efficient way to deal with aperceived over-capitalization problem inits Pacific fishery. The Departmentintroduced a series of policy reforms thatestablished tradable fishing quotas andencouraged investors to accumulateboth quotas and licences.

Now, two studies suggest that thegovernment’s market-driven solutionscreated just as many economic, socialand ecological problems as they solved.Rural ownership of licences and quotadeclined precipitously. Traditional fishingcommunities - including aboriginalcommunities, which were particularlyhard hit - lost 45% of all major licences.

The big winners were urban investors -both corporate and individual - who hadbetter access to the capital needed topurchase the quotas and fishing licencesthat increased rapidly in value as morebuyers entered the market. Ruralresidents, hobbled by lower incomes,reduced economic opportunities andlower property values that limited theirborrowing ability, simply could notmatch the prices urban dwellers andcorporations were willing to pay forlicences and quotas.

Another notable consequence was thenegative impact on conservation.Advocates of fisheries privatization oftenargue that private property rights are aboon to conservation because they aresupposed to foster resource stewardshipand a conservation ethic in the propertyowner. But the Canadian experiment withprivatization is producing the oppositeeffect. The increased capital costs offishing and concentration of ownershipare having a pernicious effect onconservation. Urban investors who nowcontrol quotas and licences often leasethem back to working fishermen, whohave to fish harder and cut corners onconservation by over-fishing to make theirlease payments and make ends meet.

a way forward in atlantic inshore fisheries

So if freely-traded private property rightsin fisheries create more problems thanthey solve, what policy alternatives arethere to foster sustainable fisheries? TheWTO’s foray into the liberalization oftrade in fish and fish products under theNAMA process (see page 7) makes thisquestion all the more urgent.

Ironically, Canada might have a promisingalternative to propose. In what is knownas the Atlantic “inshore fisheries”, Canadalimits access to valuable species likelobster and crab to small boats, issueslicences only to individual fish harvesters,limits each individual to one licence perspecies, and requires each individuallicence holder to fish their licencespersonally. It also explicitly prohibitsprocessing companies from holdinginshore fishing licences, thereby blockingthe vertical integration of fish harvestingand fish processing operations.

These policies have created an inshorefleet of approximately 15,000independent licence holders and anadditional 30,000 crew members whogenerate 75% of the landed value and99% of the employment in AtlanticCanada’s annual $1.8 billion fishery.Moreover, these licences are distributedover hundreds of small coastalcommunities, making the inshore fisheryin Atlantic Canada an important sourceof rural employment.

Under WTO rules, it is not clear whetherfishing countries like Canada, India orBrazil will be able to adopt or keepfisheries policies that discriminate infavor of small independent fishharvesters living in rural areas, or pursueother measures that foster food securityor food sovereignty. In the ongoingNAMA negotiations however, countriesthat have already privatized theirfisheries are pushing definitions ofsubsidies that if adopted wouldstraightjacket other countries and forcethem down the path of privatization andcorporate concentration.

This can’t be allowed to happen. Simplistic,private property rights regimes based oncapital investment aren’t the solution tothe world’s fisheries problems. Privateproperty rights and market mechanismswill not ensure that fishing is sustainable,nor provide the quality of life that ruralpeople seek. The market doesn’t care aboutconservation, fishing families, fishingcommunities or whether there should befish in the water for future generations.

There are places the WTO shouldn’t begoing, and a country’s fisheries policiesare among them.

more information:www.pcffa.org/wff.htm

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*fishing: a dying tradition on the philippine islands[friends of the earth united states and friends of the earth philippines]

On the Philippine islands, fish stocks andthe artisanal fishing industry havealready fared extremely poorly in the faceof trade liberalization. The Filipino fishingsector employs 1.6 million subsistenceartisanal fishers, and approximately 6million people depend upon the industryfor their livelihoods.

Over the past decade, the Philippines hasliberalized its economy by slashing tariffsin the fish sector from 30 percent to 5percent. These tariff reductions havepaved the way for foreign fishing fleetsto increasingly operate off the coast andbring imports into port. As a result, boththe supply of fish and the income offishers have declined due to resourcedepletion and lowered productivity.

The government attempted to limit thedumping of fish imports with itsFisheries Code of 1998, which bannedthe sale of imported fish on wet markets,only allowing imports for canneries andprocessing. Unfortunately this law israrely enforced and smuggling iscommon, especially of cheap frozen fishfrom China and Taiwan.

In addition, the legal yet unsustainableactivities of Japanese trawlers fishing inFilipino waters, combined with pollutedwaters and the spread of aquaculture(leading to further pollution and loss ofaccess to both the sea and theproductive waters of mangrove forests),has caused artisanal fish catches toshrink significantly over the years.

As a result of trade liberalization, anestimated 20% of small and medium-scale commercial fishers have lost theirlivelihoods in the Philippines. Povertyrates among fishers are higher thanamong the total population, and themajority of the poorest provinces arecoastal ones.

*opening markets punishes indonesian fisherfolk [p. raja siregar, walhi/friends of the earth indonesia]

For fisherfolk in Indonesia, a small catchalways means small returns, but a bigcatch doesn’t always mean increasedincomes. It may be that there are toomany fish being sold in the market andprices drop. Or that the fish are not sold,and perish. Or that the fish are discardedat sea. Trawl boats in the Mollucas andSeram, for example, currently throw 90%of their catch back into the ocean in theirsearch for profitable shrimp and tuna.

encouraging local industry and minimizing fish waste

By making use of this surplus and lowquality fish, a viable fish processingindustry could reduce these risks and atthe same time increase fisherfolks’incomes. The Indonesian processingindustry is however struggling to developin the face of unhelpful national policiesand international trade regulations.

The most common processed fishproduct is fish powder, which is used asfeed in shrimp and fish farms. Promotingthe fish powder industry could be aparticularly useful way of allowingfisherfolk to benefit from damaged andunwanted fish that would otherwise goto waste. Currently, however, Indonesiaimports enormous and increasingquantities of fish powder. In 2002,61,301 tons of fish powder worthUS$37.6 million were imported (27%more than in 1998). Fish powder, most ofit from Latin America, constitutes 60% ofIndonesia’s fish imports.

fish and shrimp dumping

Tariff escalation, which means that themost highly processed products attractthe highest tariffs, discourages thedevelopment of domestic processingindustries in exporting countries. The EU,for example, imposes escalating tariffson Indonesia’s processed fish products.EU tariffs on processed fish products mayreach 40%, while those on raw materialsare only around 5%.

In addition, Indonesia’s own import tariffson fish are very low - between 0% and 3%- while domestic fish are taxed at 5%. Thisencourages national businesses and theprocessing industry to buy cheapimported fish, leaving fisherfolk with evenmore unsold catch. Low tariffs have madeIndonesia a magnet for dumped products.

Since 2004, for example, Indonesia hasbeen flooded with shrimp imports fromChina and Vietnam that have beenrejected by the United States. Indonesianshrimp farmers are understandably up inarms about this dumping of shrimp thathave been rejected elsewhere.

Indonesia should be able to apply tariffsand other trade restrictions to fish(especially those small-sized speciescaught by fisherfolk) and fish powderimports, and EU tariff escalation must stop.These measures would protect fisherfolkand encourage domestic processing.

part three | food

18 | foei

food, seeds and free trade alberto villareal, redes/friends of the earth uruguay

three food

Free trade rules and enforcement mechanisms support acorporate assault on the world’s peasantry, farming indigenouspeoples and small-scale family farmers, threatening the verybiodiversity and environment that they have historicallydepended upon, cared for, and enriched.

Food has been bought, sold and exchanged throughout history, andhas almost always been grown and consumed locally. Internationaltrade in food is just a fraction of global agricultural output. Yet sincethe WTO’s Agreement on Agriculture was signed in 1994, food isincreasingly treated as just another industrial good to be producedand sold anywhere to those who can afford to pay for it. In addition,trade rules - on subsidies, import restrictions and intellectualproperty rights - combine to work in favor of transnationalagribusiness and against the interests of small farmers.

dumping on small farmers and the environment

Current trade rules are generating increasingly inequitable terms oftrade for small farmers worldwide, especially in developing countrieswhere up to half of the population may be engaged in agriculture.These rules are forcing down farm-gate prices (though not in-storeprices) for agricultural products and commodities, which benefitsthe corporations that increasingly control food production and tradeworldwide. At the same time however, the rules also allowindustrialized countries to subsidize their products and dump themin southern markets where they undercut local producers.

Expanding trade in export-oriented monoculture plantations isalso placing an immense burden on the environment. Again thisis especially problematic in the South, where it leads to extensivedeforestation and biodiversity loss, the contamination andreduced availability of fresh water, air pollution, soil degradationand desertification. All of these further increase the social andecological debt that northern countries owe to the South.

The drive to export means that extraordinarily high numbers ofsmall farms in both South and North are failing or being boughtout by larger farms and agribusiness. Communities withoutlegal ‘ownership’ of their land are being evicted, sometimesviolently, to make way for industrial-scale agriculture. Yet small-scale farming is vital for food sovereignty and security, robustrural economies and the production of healthy local food.

Everyone has the right, as enshrined in the 1996 RomeDeclaration on World Food Security, to have “safe and nutritious

food” and “be free from hunger”. Those who promote free tradein agriculture ignore the importance of food, in all its diverseforms, to cultures around the world.

rules and profits for the food giants

In fact, ‘free trade’ rules in agriculture are clearly designed tobenefit large-scale, capital-intensive, export-oriented producers.They also favor the interests of transnational agrochemical firms,companies selling genetically modified seeds, commoditytraders, giant food and feed processing firms and the leadingfood retailers that increasingly control global food supply. Thesesame rules are locking developing countries into providing low-cost natural resources and goods to the rest of the world in orderto earn hard currency with which to pay off ‘official’ debts.

Ten years after the creation of the WTO, it is clear that EU and USpromises of agricultural liberalization are an illusion used totempt the poorest countries into opening other sectors,particularly in industrial goods and services. Wherever therehave been increased export opportunities for agriculturalproducts from the South to the North, most if not all of thebenefits have gone to a small elite in the exporting countriesand the transnational corporations involved. The Agreement onAgriculture has also allowed the EU and the US to continue tosubsidize their largest and most influential farmers heavily (inthe UK, for example, 80% of subsidies go to just 20% of farmers).

Free trade rules in agriculture also discriminate against organicfarming and other more environmentally-friendly forms ofagriculture. They discourage labelling requirements that giveconsumers a choice about what they buy. Trade rules also workagainst the introduction of high food standards, which areimportant to the development of sustainable agriculture.

people's food sovereignty is the future

The inclusion of agriculture in the WTO and other tradeagreements cannot work for farmers, consumers or theenvironment. Together with consumers’, indigenous, peasant andsmall farmers’ organizations, Friends of the Earth International isworking for diverse farmer-based, localized and organicagriculture systems that grow food for local consumption. Tradein agriculture and food products should and will continue, but asan option rather than an obligation, and regulated by animproved and strengthened United Nations.

Existing rules that prioritize corporate profits and export rightsneed to be replaced by peoples’ food sovereignty - that is theright of peoples, communities and nations to decide upon theirown sustainable agriculture and food policies.

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*bacon and beans: how trade in pork and soy causes hunger, pollution and human rights violations[bente hessellund andersen, friends of the earth denmark]

Far from contributing to the production ofenough food for all, Danish pig productionis a perfect example of the way in which acombination of intensive agriculturalpractices and liberalized internationaltrade can lead to social disruption,environmental damage and even hungerin different regions of the world.

Denmark is a small country, yet it stillmanages to produce 25 million pigs everyyear which it exports primarily to rich‘overfed’nations such as Germany, the UKand Japan. Since it has so little land, itrelies heavily on imported soy feed, 80%of which comes from Argentina.

soy stresses in latin america

Soy production results in a gradual transferof critical nutrients from Argentina toDenmark, causing problems in bothcountries. Argentinean soil is depleted, asmost of the above-soil organic matter isremoved during soybean harvest. Soy isalso particularly efficient in extractingnutrients from the soil, meaning it can begrown without expensive fertilizers forseveral years. This is cost-effective in theshort-term, but eventually leads to soilerosion and desertification.

Increasing soy production is also leadingto dramatically increased rates ofdeforestation at the core of the Amazonforest in the centre-west region of Brazil,in the Interior Atlantic forest in theMisiones Province in Argentina, in theChiquitano forests in Bolivia, and in theParana forest in Paraguay among otherplaces. The soy boom has turned highlyvaried landscapes consisting of smallfarms, forests, grasslands and otherbiologically and culturally diverseecosystems into oceans of monoculture.As soy production is not labor intensive,its expansion has led to thedepopulation of the countryside. All overthe region, small family farms are beingtaken over, often forcefully, contributingto the erosion of rural traditions,unemployment and poverty.

The soy bean boom has hit women (whoplay a central role in running familyfarms) and indigenous peoples (whoselands are often impacted) the hardest.Some 60 million indigenous peoplearound the world are almost entirelydependent on forests to supply keyelements needed for their survival,including food, fuelwood and medicine.

pork problems in europe

On the other side of the world, theDanish pig industry is so intensive that itreleases nitrogen and other fertilizersinto the surrounding environment viamanure and evaporation. Danish pigfarms generate 25-40 tonnes of liquidmanure per hectare each year, and lakes,streams, fjords and inner waters sufferfrom severe oxygen deficits. Evaporatedammonia – including the 50,000 tonnesthat reach surrounding countries, suchas Sweden – also degrades bogs, moors,meadows, dunes, commons and somewoodlands. Almost half of this nitrogen(82,000 tonnes out of a total of 166,000)is imported into the country in fodder.

starving despite the soy

Danish pig production contributes tohunger in Argentina. In spite of the vastand fertile agricultural land in thecountry, ongoing economic andagricultural crises mean that Argentinahas difficulty feeding its own population.Fifteen million people (38.5 per cent ofthe population) live below the povertyline, and Argentina was listed by theFood and Agriculture Organization asone of the 35 countries around the worldfacing a food crisis in 2004. Although thesituation abated somewhat in 2005, it isstill more profitable for landowners tosell or rent their land for soy productionthan to grow crops for localconsumption, and local supplies of milk,meat and vegetables are disappearing. InArgentina, 150,000 farms have been lostin recent years, and at the same time thearea used for soy production has nowgrown to 14 million hectares.

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Similar restructuring is taking place inEurope. Pig farming in Denmark isincreasingly dominated by large industrialfarms, and an average of eight smallfarms are lost every day. Land prices haverocketed, discouraging new farmers fromsetting up. The largest ‘farmers’ are nowmoving eastwards – to Poland, Lithuania,Latvia, Hungary, Slovakia, the Ukraine andRussia – to avoid Danish regulations andpublic hostility. Although they arefinancially supported by the Danish state,these companies do not always abide byDanish environmental legislation despitetheir being obliged to do so.

Industrial pig farming is thus in turnbeing imposed on Eastern Europe aswell, in a new form of colonization, withlocal rural employment and productionin yet another region of the world aboutto succumb to the impacts of the Danishpig industry.

soy harming health and the environment

The increasing prevalence of soy in theArgentinean diet is developing into anational health problem. Some soupkitchens for impoverished people servedonated soy-based meals, which aregenerally not tested for pesticide residuesand can have severe impacts on childrenin particular. Argentinean nutritionistsand the government have recommendedthat soy should not be part of the diet forchildren under the age of five.

Furthermore, most soy grown inArgentina today, such as Monsanto’sRoundup Ready soy, is geneticallymodified. Rogue soy plants and Roundupresistant superweeds, combined with ano-tillage practice, have actuallyincreased the already large amounts ofherbicides being used. Aerial fumigationhinders communities trying to growcrops, and contributes to very serioushealth problems as observed in Ituzaingoin Cordoba Province where cancer ratesare increasing dramatically.

the violence of soy production

The introduction of soy is also leading towidespread evictions and unemploymentin Argentina and surrounding countries.In recent years, the World Bank forcedArgentina to open its borders totransnationals associated with the seedand agro-chemical industry, such asMonsanto, which are then able topurchase legally-binding contracts forgrowing soy. In many instances, the smallfarmers that have been farming the landfor generations are forcibly removed, asthey have no legal proof of landownership. In Paraguay, police forciblyevicted the Tekojoja community in theCaaguazú Department from their landsin June 2005. Two people were killed, 130arrested (including women and children),and 270 people displaced.

Members of La Via Campesina (theinternational network of peasantfarmers) have commented that: “Humanrights violations such as these arereplicated throughout the soy regions ofLatin America. Wherever the soy businessexpands, people are forcibly evicted,either by arms, or by the poisonous fumesof crop-spraying planes.”

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*genetically modified versus organic food how the wto meddles in what we eat[markus steigenberger, bund/friends of the earth germany]

Although agriculture in Germany ishighly industrialized, organic farming isbecoming more and more popular.Organic farming has many positiveeffects. It reduces chemicals in theenvironment, produces healthier food,provides a more diverse landscape, andcontributes to greater biodiversity.Genetically modified organisms (GMOs)have the opposite impact. They areplanted in large-scale monocultures,threaten animal and plant diversity, andcould cause health problems. GMOs arethus incompatible with organic farming.

Until very recently, the European Unionhas managed to remain largely free ofGMOs, thanks to overwhelming publicrejection. But trade rules now threaten tooverturn this state of affairs, and maysoon impose GMOs on people acrossEurope. This would be a major setbackfor organic farming since organicproducts must be demonstrably GM-free, and would certainly set back effortsto strengthen sustainable agriculture inGermany and the rest of Europe.

forcing gmos down european throats

In May 2003, the US, Canada andArgentina submitted an officialcomplaint to the WTO challengingEuropean policy on GMOs. This was thestart of a complicated and highlycontroversial trade dispute that is due toend in 2006. The three plaintiff countriesargue that the EU’s refusal to accept anyapplication of new GMOs since 1998,combined with EU member states’ abilityto impose national bans on GMOs,

conflicts with WTO rules. They aredefending the export interests of hugebiotech corporations, such as the US-based Monsanto, by attempting to useWTO rules to force Europeans to growand eat GMOs.

While this trade dispute continues,farmers and consumers in Europe faceanother threat. A few years ago, the EUpassed a directive allowing theproduction and sale of GMOs as long asthey are clearly labelled. The underlyingidea is to give consumers the choicebetween GM and non-GM food. This isproblematic, however, since GM pollencan be blown onto organic farms up to25 kilometres away. Thus ‘co-existence’can only work if large buffer zones areplaced between GM and organic farms.This is why Friends of the Earth Germanyis campaigning together with otherorganizations to establish ‘GMO-freezones’ throughout the country. To date,more than 16,000 German farmers havedeclared their fields ‘GM free’.

*indonesian farmer sued by seed company[p. raja siregar, walhi/friends of the earth indonesia]

Mr. Tukirin, a 62-year-old farmer in theNganjuk district of East Java, Indonesia,was very surprised when police officerscame to his house and corn field andaccused him of the “illegal certification”of patented seeds and of stealing seedsfrom a hybrid corn producer, PT BISI, asubsidiary of Asia’s largest agriculturalconglomerate Charoen Pokphand.

Tukirin had not stolen any seeds. In fact,he had bought them from an authorizeddistributor, wanting to develop his corncultivation skills and use the harvestedcorn as seeds for his next planting. Thehybrid corn he had previously planted andharvested could only be sold or consumed,not used to produce seeds to plant.However, Tukirin successfully cross-pollinated the second set of seeds hebought, then harvested corn that could beused as seeds and indeed grew well. Heshared this discovery with other farmers.

Ironically, Tukurin’s hybrid corn cultivationskills were acquired through a project co-organized by PT BISI and a local farmers’organization. Yet the company penalizedTukurin for the application of his newlyacquired skills, realizing that farmerswould no longer be dependent upon theirproduct. Company officials visitedTukirin’s field and then went to the police.

guilty of seed theft?

In February 2005, the court found Tukiringuilty of illegally adopting PT BISI’stechnique, that is committing “illegalcertification”. Tukirin was sentenced to aone-year ban on planting and received afine. Commenting on the decision, Tukirininsisted on his innocence: “I bought theseeds and planted them in my own field.Why should I be punished?” Otherfarmers agreed: “We were not told not toreplicate the system in our fields. So whatwas the project for in the first place?”

In addition, the court failed to follow theproper procedures. Mr Tukirin did notknow he could be represented by alawyer, nor did the court provide one.Furthermore, he did not receive a copy ofthe verdict despite having asked for one.Thus, for five months he did not haveaccess to the details of his alleged crime.It was only in June 2005 that Tukirin,accompanied by WALHI/Friends of theEarth Indonesia, managed to acquire acopy. There was no opportunity to lodgean appeal.

Tukirin’s case is only one example of thelawsuits brought by large companiesagainst small farmers; many moreinjustices can be expected as seedcompanies consolidate their controlaround the world.

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Mr. Tukirin and his wife holding the corn under question.

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*colombian agriculture and the andean free trade agreement[tatiana roa avendaño, censat agua viva/friends of the earth colombia]

Colombia is a country of contrastingregions and ecosystems. As a result,many different crops can be grown:coffee flourishes on its mountain slopes,sugar cane in its valleys, and cotton andsorghum in the warm savannah regions.Potatoes, cereal and wheat are other keyagricultural crops.

Colombia used to produce food sosuccessfully that it was virtually self-sufficient. However the aggressiveopening of markets in the ninetieschanged this, tipping Colombianagriculture into bankruptcy. Tariffliberalization in the cereal sector allowedcheap imports to flood in, putting manyfarmers out of business. The area of landbeing farmed shrank by 750,000hectares. Meanwhile, rural poverty ratessurpassed 80%.

The government has however failed tolearn from this experience, and theproposed Andean Free Trade Agreement(TLC) with the United States poses yetanother threat to Colombian agriculture. IfColombia signs up, it will mean agreeingnot to use agricultural subsidies or variabletariffs to protect domestic agriculture andaccepting yet more subsidized cerealimports. It will also lead to the patenting ofbiodiversity, and the opening of markets tonew foreign investment and serviceproviders, both greatly benefitingincoming transnational corporations.

raw trade deal for colombia

In return, Colombia’s benefits would beconfined to the flower, vegetable, palmoil and tobacco sectors. In other words,Colombia is being asked to exchange itsability to feed its people for theopportunity to increase exports. Foodsecurity would be exchanged foragricultural intensification, degradedsoils and the diversion of increasingquantities of water to agriculture. Thishas already been seen in intensive flowercultivation, for example, which is nolonger confined to the plateau aroundBogotá, but has spread to the Amazonianand Chocoanas forests.

In response, however, a nationalmovement against free trade and foralternative agro-ecological production isdeveloping. Communities, farmers,indigenous peoples and organizationsare establishing partnerships - such asthe Agrovida Association in the GarcíaRovira region - to promote organicproduction and local regional markets,ensure fair prices, and protect traditionalseed varieties. These local markets createnew relationships between urban andrural people, improve their quality of lifeand restore a degree of autonomy andsustainability to communities.Ultimately, they will form the foundationof food sovereignty in Colombia.

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*molino santa rosa: production for and by local people in uruguay[carlos reyes and alberto villarreal, redes/friends of the earth uruguay]

Molino Santa Rosa was once aflourishing mill and the biggestemployer in Santa Rosa, a rural town of3,500 people near Montevideo inUruguay. Traditionally, the area had avibrant agricultural sector dominated bysmall and medium-sized family farmsproducing fruit, vegetables and somegrain and poultry. Farmers sold theircrops and animals in the market inMontevideo and to the dynamic agro-industries that flourished nearby.

However, market opening policies in the1980s and 90s caused economic chaos inUruguay. In particular, agriculturalliberalization and cheap importswreaked havoc on the farmingcommunity. This, together with therecent financial crisis, led to a crisis inthis net food exporting country, eventhough it can feed 10 or 20 times its ownpopulation. Competition from biggercompanies also led to difficulties forMolino Santa Rosa, and its owners closedit – twice in fact, once in 1987 and againin 1998.

workers’ cooperative welcomed

Happily, however, Molino Santa Rosa istoday operated and managedsuccessfully by a local workers’cooperative founded in 1999 by many ofthe mill’s former employees. They wereable to negotiate a very favorablecontract with the public bank, BancoRepública, thus securing jobs andrescuing one of the main engines of localeconomic development. More than 70families are now directly associated withthe self-managed mill, including coopmembers, employees, farmers andservice providers. It is the largestemployer in town, and pays triple thewages of the local poultry industry.

The mill is also contributing to arenaissance in local farming. Most of themilling products are based on wheat,part of which is bought directly fromfamily farms no bigger than 40 hectares.The mill is also diversifying into otherlocally-produced family farm products,including GM-free corn flour (to cookpolenta) and chick pea flour (to make‘faina’, a traditional pancake-like bread).Similarly, in April 2004 the millestablished an agreement with asubsidiary of the biggest dairy industryin the country, CONAPROLE (itself anational farmers’ cooperative) to providegood quality animal feed for its dairy cowfarmers in Uruguay’s southern provinces.

the return of the white bean

Winter white beans – like chick peas, atraditional crop abandoned in the face ofcheap imports – have also beenreintroduced by the cooperative’sfarmers. White beans used to be animportant part of farmers’ food securityduring the winter, and this developmentis critically important for local andnational food security, as well forming asan excellent way of using spare threshingand packaging capacity. The milled andpackaged products are sold mainly tonearby small and medium-sized bakeries,pasta manufacturers and retailers.

The new center-left government viewsthis workers’ cooperative as a promisingmodel, and may help to replicate itelsewhere in the country. Additionally,the Sustainable Uruguay program,coordinated by REDES/Friends of theEarth Uruguay and other civil societyorganizations including farmers, iscalling on the government to revive thenational food program, Subsistencias, bybuying locally produced, organicproducts from family farms andprocessed food stuffs from workers’cooperatives such as Molino Santa Rosa.

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part four | water

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four water

It’s sometimes easy to forget that water - such an apparentlyabundant resource for those who have it on tap – is scarce inmany regions of the world. Water is essential to life in all forms:without water, death takes only a matter of days. Without rain orirrigation water, crops fail and biodiversity dwindles. Withoutclean drinking water and sanitation, diseases and sicknessspread rapidly.

Water’s importance has been recognized by governments timeand time again, and one aim of the United Nation’s MillenniumDevelopment Goals (MDGs) is to halve the proportion of peoplewithout sustainable access to safe drinking water and basicsanitation by 2015. However current trends indicate that wehave little chance of meeting this goal, let alone ensuring safewater for all, unless we fundamentally change our approach tothe use and control of water.

water: human right orcommodity for trade?ronnie hall, friends of the earth england, wales and northern ireland

“We need to build water democracy,

not water markets. We need to defend the

rights of communities, not corporations.

We need to conserve water, not consume

it wastefully or destroy it.”Vandana Shiva, Indian water activist.

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Five years after the MDGs were originally agreed, 1.8 millionpeople still die every year due to lack of hygiene, sanitation and adecent water supply. A further billion people – one in every sixpeople on the planet – lack access to safe drinking water, and 2.4billion still have no toilets or other forms of improved sanitation.

As springs, lakes and even seas dry up, the planet loses thefreshwater ecosystems and wetlands that are critical tobiodiversity and help to control erosion and store excess water. Inaddition, export-oriented agriculture is increasing levels ofirrigation, causing erosion and increased soil salinity whicheventually makes the soil unsuitable for agriculture. All over theworld, chemical and human waste is increasingly seeping intopreviously clean groundwater sources.

water as an economic good

However, water’s scarcity in some regions of the world is alsoturning it into an immensely desirable commodity, and watercompanies have now succeeded in persuading mostgovernments to adopt an overwhelmingly commercialapproach. In 1992, one of the four guiding principles agreed inthe Dublin Statement on Water and Sustainable Developmentwas that: “Water has an economic value in all its competing usesand should be recognized as an economic good.”

By reducing water to an “economic good” and further categorizingthe water economy as a “market economy”, this approach makeswater privatization and commodification inevitable. By ignoringthe ecological and hydrological limits of water availability, andallowing water access and water distribution to be driven byinsatiable markets, the world’s water crisis is likely to deepen andaccess to water will become even more inequitable.

not a drop to drink

Over 70% of the world’s water is now used for crop irrigation, and60% of that is wasted. Frequently, these crops are destined forexport to wealthy consumers, and not for local consumption. Inthe San Francisco Valley in Brazil, for example, water resourcesare primarily used to irrigate fruit and sugar cane for export. Afurther 22% of the world’s water is used by industry, with just 8%remaining for human consumption.

Some governments have teamed up with the private sector inorder to solve these problems, through ‘public-privatepartnerships’. They argue that by bringing in private investmentand know-how they can improve the situation without spendingpublic funds or threatening domestic economic growth.Business is happy with this approach: in the 1990s, watercompanies expanded, merged and diversified to become amongthe world’s biggest and most powerful transnationalcorporations. Suez, RWE and Veolia Environnement are amongthe largest, along with beverage companies Nestlé, PepsiCo,Coca-Cola and Danone, which now dominate the rapidlygrowing and highly profitable bottled water market.

The carrot for these companies is provided through the WTO andvarious other trade and investment negotiations. Governments, ledby the European Union, are trying to use these negotiations to leveropen and lock in new water collection and distribution markets fortheir transnationals. There is, however, plenty of evidence tosuggest that this approach doesn’t work. As the TransnationalInstitute and Corporate Europe Observatory concluded in a 2005report: “Almost without exception, global water corporations havefailed to deliver the promised improvements and have, instead,raised water tariffs far beyond the reach of poor households.”Companies need to make a profit, which means that poor peoplewho may have previously had access to free or cheaper water mustpay. The principle of ‘universal access’ is also being abandoned.When the water commons are enclosed, the poor and themarginalized become further excluded.

unhealthy water flows

Water is increasingly being exported across national boundaries.Canada, for example, exports water to the United States, despitegrowing alarm about the environmental impacts that this willhave on the Great Lakes. Similarly, the Plan Puebla Panamainvestment project will increase access to freshwater resourcesas well as new markets in Central American countries.Companies such as the American Beverage Company (alsoknown as AmBev, the world’s fifth largest brewer and Brazil’sleading beverage company) are the main beneficiaries. Similarly,the Initiative for the Integration of South America’s RegionalInfrastructure (IIRSA) could allow foreign bottled watercompanies to access the subterranean waters of the AcuíferoGuaraní in Argentina, Brazil, Paraguay and Uruguay. Thispotential drain on freshwater resources could eventually reducethe local availability of freshwater.

The impacts of trade liberalization upon water urgently need to berecognized and reversed. Access to water should be fully recognizedas a human right, as suggested by the UN Committee on Economic,Social and Cultural Rights in November 2002. Water should beremoved from trade liberalization negotiations, and governmentsmust remain free to manage and deliver water as a public service.A public water sector should include both community-managedsystems as well as public utilities like municipal water supply andirrigation for sustainable food production to meet local needs.Exports of water for wasteful industrial and agricultural use andunnecessary consumption need to be curbed, freeing up waterresources to provide clean water for human consumption andsanitation, the development of fair and sustainable localeconomies, and the conservation of vital ecosystems.

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transnational power in latin america

Many of the largest transnationalcompanies now operating in LatinAmerica are dedicated to extracting andselling the region’s natural resources. Arecent survey by the magazine AméricaEconomía of the 500 largest companiesactive in the region showed that overhalf of the twenty most profitablecompanies were dedicated to the exportof natural resources, with hydrocarbons

being the main focus. Five of the toptwenty companies were oil companies –Petrobas, Repsol/YPF, Esso, Texaco andRoyal Dutch/Shell – and companiestrading in hydrocarbons had sales ofmore than US$250 billion. Other keynatural resource-related sectors includesteel, cement, food and forest products.

paola visca, third world economics,www.redtercermundo.org.uy

* This has resulted in people having to payfor water from pumps that waspreviously free. To date, privatizationdoes not appear to have increased thenumber of urban consumers havingaccess to water and sanitation.Furthermore, turning water into aneconomic good makes it increasinglyunlikely that supplies to poor,unprofitable rural areas will be improved.

The people of Togo urgently needimproved water supplies and sanitation,but privatization and the possibleliberalization of services do not appear tooffer viable solutions. Friends of theEarth Togo is focusing on alternativeways forward, including public educationabout water management and thebuilding of free public fountains.

Togolese people, especially those living inthe interior of the country, have a range ofproblems relating to water. In some casesthere are serious water shortages, whilein other areas water is plentiful butmismanaged and heavily polluted.

Until 2003, the production, supply andpurification of water in Togo wasundertaken exclusively by La RégieNationale des Eaux du Togo. In 2004,however, management of the country’swater supplies was transferred to theSociété Togolaise des Eaux, no longer astate monopoly with exclusive rightsrelating to drinking water and wastewater treatment, but a more commercialand results-oriented company.

water woes in togo[kokou elorm amegadze, friends of the earth togo]

water solutions in the village of kovié sévého

People living in the village of KoviéSévého, some 30 kilometres from Lomé,struggle to collect water. Although mosthouses have their own water tanks,rusted roofs and gutters mean that thequantity and quality of water collectedduring the rainy seasons is very poor.Some cisterns are located on the groundto catch surface water, but this is heavilypolluted. In the dry season, villagers haveto rely on the waters of the river Zio someten kilometres away.

The people of Kovié Sévého suffer fromincreased levels of disease anddehydration. There is not enough waterfor bathing and cleaning. Women andchildren, who are primarily responsiblefor collecting water from the river, areoften very tired. There are frequentbrawls around the water points.

However, the villagers have made effortsto solve their problems. Those that canafford to maintain their roofs sell their‘drinkable’ water to others at low rates. Inaddition, a marshy basin has been builtnearby to retain additional water.

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*people’s water power in uruguay[sebastian valdomir and alberto villarreal, redes/friends of the earth uruguay]

On 31 October 2004, more than 64% ofUruguay’s population voted to establishwater as a basic human right, to retainthe public provision of water andsanitation, and to ensure sustainableand participatory water management. Inother words, they voted to ensure thattheir water services are managed by thepeople for the people.

uniting to defend water and life

This was an overwhelming rejection ofthe privatization of water foisted uponUruguay by the IMF and the World Bankand by the liberalization of waterservices planned in the WTO and the FreeTrade Area of the Americas.REDES/Friends of the Earth Uruguay,public water unions, local communityorganizations and others had worked inthe Commission in Defense of Water andLife to achieve this victory.

The Uruguayan government had beengranting concessions to watercompanies, including subsidiaries ofSuez (Aguas de la Costa) and Aguas deBilbao (Uragua), to help meet thecountry’s sanitation requirements.However, the companies never deliveredon their contractual commitments forsanitation; the quality of the service theyprovided was poor; and water andsanitation tariffs were extremely high.

When they were rejected by the Uruguayanpeople, the companies turned tointernational treaties to force the newgovernment - which had supported thewater vote - to change track. Suez and Aguasde Bilbao threatened to sue the Uruguayangovernment for millions of dollars incompensation, claiming that the results ofthe vote breached their contracts underexisting bilateral investment treaties withFrance and Spain. Faced with the threat ofmulti-million dollar payouts, and at thesame time holding the record for the world’shighest per capita level of indebtedness (as apercentage of GDP), Uruguay was in adifficult position. The government initiallycapitulated, allowing the companies tocontinue to operate until 2015.

Public opposition finally brought about amore forceful approach. Eventually,Aguas de Bilbao’s concession wascancelled due to repeated breaches ofcontract. The company dropped aplanned lawsuit against the governmentand agreed to leave the country inOctober 2005, although it was allowedto retrieve financial guarantees it hadmade. In the case of Suez’s subsidiary,the government may ultimately buy thecorporation out.

While these settlements are less thanideal, they demonstrate the power ofcollective opposition. Environmentalists,trade unions and local communityorganizations can express theiropposition through plebiscites andpopular referendums, and confront thepower of corporations by exercising directdemocracy. This is an effective first step inrolling back the power of corporations.

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part five | minerals

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five minerals

As with other commodities, the international trade in minerals isdriven by demand. Industrialization has increased globaldemand for minerals a thousand fold, and consumptioncontinues to grow as minerals are involved in most of the goodsand services consumed today.

However, our voracious consumption of metals comes at anenormous price. Mining has displaced numerous communities,especially indigenous peoples. In the Philippines, for example,over half of all mineral applications are in the ancestral domainsof indigenous peoples. Globally, over 50% of all mining areas arein similarly significant places.

mining’s environmental and social costs

The environmental consequences of mining are also serious:nearly 80 tons of mining waste are discarded for every ounce ofgold. Mining also requires huge amounts of energy, and themining sector is responsible for about 10% of global energyconsumption. Mining also requires tremendous amounts ofwater: the amount of water used to extract copper, for example,is 3,200 liters per ton of ore.

The global mining industry is structured in a way thatdisadvantages poor communities and developing countries.While developing countries provide most of the world’s mineral

diamond rings or community welfare? how the international mineral tradeharms communities and environmentsingrid gorre, lrc-ksk/friends of the earth philippines

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Two boys in the Philippines, with sores on their legs due to toxic pollution from the Marcopper mine.

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requirements in the form of ore, processing usually takes placeelsewhere. The country where the mining takes place reaps farfewer benefits than the country selling the end product.

Whilst mineral resources are found in both developed anddeveloping countries, the latter bear the main social andenvironmental costs. From 1999-2002, 68% of the world’s mineralexports came from developing countries. In contrast, developedcountries are the major exporters of semi-manufactured andmanufactured goods based on these mineral resources. Thisstructure endures in part because of “tariff escalation”: tariffs onmineral ores are low, and high import tariffs on processedproducts discourage manufacturing elsewhere.

does the world need more mining?

Given the huge social and environmental consequences, shouldthe international trade regime encourage increases in themineral trade, potentially increasing consumption? The worldhas not yet maximized its use of existing minerals, as it could do

through more efficient recycling. The metals in computers andother electronics, for example, can be extracted and recycledinstead of turning to new mineral resources.

Furthermore, some minerals, such as gold and gems, areextracted purely for investment purposes and ornamental use.Seventy-eight percent of the global demand for gold, forexample, is for jewelry. WTO negotiations include proposals toreduce tariffs in the gold and gems sectors. This would bringdown the price of those commodities, and could encouragefurther extraction in developing countries.

International trade rules should be about encouraging lessmining and more recycling. They should also be about theprimacy of food and other essential products, and shoulddiscourage trade in less essential minerals that are produced athuge social and environmental costs. After all, the lives andlivelihoods of communities are far more important than any 24-carat gold ring.

*ghana, gold and trade liberalization[george awudi bright and helen la trobe, friends of the earth ghana]

Ghana’s 1983 World Bank-IMF StructuralAdjustment Program led to theprivatization and massive expansion ofGhana’s mining sector, particularly in goldfor export. The government gave incentivesto encourage mining investment:liberalizing imports, removing currencycontrols and reducing state regulation. Thisgenerated a more favorable investmentclimate for mining companies, and as aresult 70-85% of large-scale mining is nowforeign-owned. Mining companies areallowed to repatriate up to 80% of theirprofits, and all obstacles to total foreignownership have been removed. As a result,it is estimated that only 10% of the value ofGhana’s gold (some US$70 million)actually accrues to the national economy,while the gross cost of environmentaldegradation as a result of acceleratedactivity in Ghana’s extractive industries isestimated to be 5% of the country's GDP(about US$2.23 billion).

tarnishing the environment

The environmental and social impacts ofgold mining in Ghana have beencatastrophic. Land degradation, habitat

destruction and air and water pollutionby heavy metals, arsenic, sulphur, gasesand dust have been widespread. Land hasbecome so severely contaminated that itis no longer able to support vegetation orcrops. Farmlands have been encroachedupon by mining activities, severelyundermining food security in miningcommunities where hunger persists.

Releases of poisonous gases from twomajor gold mines are so high that localpeople suffer from illness similar toarsenic poisoning. Cyanide, heavy metalsand chemicals used in gold mining andprocessing are discharged untreated intowatercourses, polluting drinking waterand poisoning fish, an important foodsource. Mining also causes severedeforestation: 60% of Ghana’srainforests in the Wassa West Districthave already been destroyed by miningoperations, for example.

harming people

Social impacts have been equally dire.Local communities have suffered evictionand forced relocation. It is thought that

around 50,000 indigenous people havebeen displaced by mining operationswithout adequate compensation. Womenhave been raped, activists illegallydetained, local cultures denied, villagesburned and local people intimidated.Social breakdown such as drug abuse,crime and prostitution is widespread inmining communities. Loss of farmlandsand the use of access roads has causedgrowing tension and conflict betweenlocal people and the mining company’ssecurity personnel, as well as with policeand the military, escalating into beatingsand even the death of villagers. Goldmining activities in one area, where two-thirds of the local land has been sold off tomultinationals, have caused the spread ofmalaria, tuberculosis, silicosis, acuteconjunctivitis and skin diseases with verylittle compensation for local communities.

The government has now taken thedecision to allow mining within Ghana’sforest reserves. Prospecting has beencompleted, mining camps andinfrastructure are already in place in mostreserves, and mining companies are nowgoing through the permitting process.Mining in forest reserves goes against thewishes of the majority of Ghana’s people,and will only deepen the environmentaland social crises already underway withinand around Ghana’s forests.

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*mining frenzy in the philippines [lodel magbanua, lrc-ksk/friends of the earth philippines]

Following the global recession in the1980s, countries in Southeast Asia turnedto foreign investment to boost theireconomies. In 1990, an IMF-World Bankstaff report described the Philippines asstill having relatively restrictive laws andregulations governing foreign investmentin key sectors. To attract more foreigninvestment, the Bank recommended thatthe government expand foreignparticipation in various industries,including mining.

Similarly, in 1994 the Asian DevelopmentBank’s mineral sector study proposed theabolition of the 40% limitation on foreignequity in mining corporations. It alsorecommended that mining companies begiven tax holidays, full repatriation ofprofits, and other incentives.

On 30 March 1995, the Philippine MiningAct was enacted. This new law allowedfully foreign-owned corporations toexplore, develop, utilize and exploitmineral resources. They could now applyfor exploration permits, mineral processingpermits and financial or technicalassistance agreements (FTAAs) and couldoperate mining projects directly. They werealso given a wide range of financialincentives, and incentives in relation to theemployment of foreign nationals.

influx of mining companies

Four months after the enactment of thenew law, 21 foreign mining firms (andone local one) had applied for FTAAscovering six million hectares - 20% of thetotal land area of the Philippines. Two100% Australian-owned miningcompanies were soon awarded FTAAs:the Western Mining CorporationPhilippines (WMCP) and the ClimaxArimco Mining Corporation (CAMC).

The entry of these foreign miningcompanies had negative impacts on localindigenous peoples and communities. InSouthern Mindanao, the WMCPorganized “tribal councils” of their ownmaking to fabricate the Free and PriorInformed Consent (FPIC) of affectedindigenous communities required underthe Indigenous Peoples Rights Act. Thecompany employed deception,harassment, co-optation and coercion toobtain the consent of the B’laanindigenous group. Militarization alsointensified with the entry of WMCP inthe area. These tactics inevitably createdresentment, divisions and conflict withinthese communities.

In 1997, the B’laan communities, togetherwith support groups and individuals, filed apetition in the Supreme Court in an effort

“The disposition, exploration, development, exploitation, or utilization of any of the natural

resources of the Philippines shall be limited to citizens of the Philippines, or to corporations or

associations at least sixty percent of the capital which is owned by such citizens.”1973 Philippines Constitution

“The President may enter into agreements with foreign-owned corporations involving either

technical or financial assistance for large-scale exploration, development, and utilization of

minerals, petroleum, and other mineral oils according to the general terms and conditions provided

by law, based on real contributions to the economic growth and general welfare of the country.”1987 Philippines Constitution

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to stop the incursion of foreign miningcompanies into their ancestral domains.The petitioners argued that the 1987Philippine Constitution, which removedprevious references to foreign corporationsbeing involved in “service contracts”,actually prohibited such corporations fromoperating and managing an entire miningproject. Thus, the 1995 Philippine MiningAct, which resurrected the “servicecontract” arrangement, was void andunconstitutional. Ultimately, the SupremeCourt upheld the petition in January 2004.

However, on December 1st, the highestcourt in the country reversed its ruling.Moved by fears of an economic backlash,the Court “reconciled” the Constitutionalprovision with the supposed imperativeto liberalize mining.

dealing with the resource curse

Communities and environmental advocatescontinue to criticize the liberalization of themining industry and the reliance onincreased resource extraction as ashortsighted strategy for revitalizing thenational economy. They cite theoverwhelming evidence linking dependenceon extractive industries to environmentaldegradation, underdevelopment, theincreasing gap between rich and poorwithin society, and the disempowerment ofpeoples. The 2005 UN Human DevelopmentReport has aptly called this link the “resourcecurse”. From the viewpoint of communitiesdirectly affected by large-scale miningprojects, liberalization will not stem thecrisis of the Philippine economy andenvironment, but will worsen it.

Bags of mine waste from the Marcopper mine in thePhilippines decomposing in the Boac river.

Local people near the Marcopper minesuffering from arsenic poisoning.

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part six | desertification

trade, desertification and livelihoods george awudi bright, friends of the earth ghana

six desertification

Desertification has long been recognized as a majorenvironmental problem, with adverse impacts on thelivelihoods of people in affected areas around the world.Desertification currently affects one-sixth of the world’spopulation and 70% of all dry lands, amounting to 3.6 billionhectares and one-quarter of the world’s total land area.

In Africa, the impact of desertification is particularly acute. Itthreatens the lives of countless millions and seriously affectsmore than 39% of the continent, dangerously undermining theability of countries to feed their people in the future.Furthermore, an increasing focus on exports to northernmarkets, combined with potential conflicts between trade rulesand the UN Convention to Combat Desertification, means thatfurther trade liberalization could worsen rather than improvethis situation.

causes of desertification

Desertification is a phenomenon that starts with loss ofvegetation and leads to decreased soil fertility and ultimatelybarren land and desert. Natural factors such as drought,coupled with unsustainable human activities including forestremoval, the indiscriminate burning of bush and forests,unsustainable farming practices and overgrazing, are all majorcauses of desertification. Impacts are severe and wide-ranging,and include soil erosion, declining soil fertility, the evaporationof water bodies, drinking water shortages, salinization,decreasing crop yields, food insecurity, hunger and starvation,disease, conflict over water and land resources, extreme poverty,migration and loss of biodiversity.

Technically, it is easy for the desertification process to betriggered in new areas if unsuitable policies encourageunsustainable land-based activities, as can happen when landis turned over to extensive export-led agricultural production.Ghana and Haiti are cases in point here, as shown by the casestudies on the following pages.

combating desertification

Concern about the scourge of desertification, particularly inAfrica, led the United Nations to elaborate the Convention toCombat Desertification (UNCCD) in 1996. One of the cardinalaims of the UNCCD is to minimize the degradation of land andhalt the extension of deserts. It promotes the adoption of “long-term integrated strategies that focus … on improved productivityof land, and the rehabilitation, conservation and sustainablemanagement of land and water resources, leading to improvedliving conditions, in particular at the community level.”

The adoption of export-led agriculture, as promoted throughthe WTO and other trade agreements, seems to be havingexactly the opposite impacts in countries affected bydesertification. Furthermore, one of the major principles of theUNCCD is that decision-making should be undertaken incollaboration with local communities. This is again at odds withthe WTO, which through its services liberalization negotiationsprioritizes the opening up of ‘nature and landscape protection’services. This could have significant impacts on the rights andabilities of local and indigenous peoples to access and managethe natural resources found within protected areas for theirown livelihoods and traditional uses.

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*expanding trade, expanding deserts in ghana [george awudi bright, friends of the earth ghana]

In Ghana, over 35% of the total land areais suffering from desertification. WhileGhanaians are battling with existingdesert conditions in the northern partsof the country, trade liberalization isgenerating new problems in the middleor forest savannah zone.

The forest savannah is a transitional zone,located between the borders of thenorthern savannah grassland and the richsouthern forest belt. It is a critical bufferzone, protecting the forested south fromdesertification from the north. It is alsorichly endowed with biological diversity: awide variety of birds, wildlife and plantspecies live in the forest savannah. Many ofthese species have biological and medicinalimportance, and local people rely upon andmanage them for their livelihoods.

water for life and livelihoods

This zone also holds importantwatersheds for the major rivers and theirtributaries that flow through thecountry, meeting the water needs of themajority of Ghanaians and providing

fish. The zone’s highly productive soilssupport a wide range of food and cashcrops, and a large proportion of thecountry’s timber and cocoa - majorsources of foreign income for Ghana –also come from this area. In short, theforest savannah is the nation’s foodbasket and a guarantee of food security.

However, as a result of trade liberalization,the cultivation and export of certain crops(previously grown mainly for localconsumption) has been prioritized incertain critical ecological zones. No onecan dispute the fact that expandedagricultural cultivation and thediversification of exports could bring muchneeded economic benefits to a developingcountry like Ghana. However, this cannotbe achieved at the expense of Ghana’sfragile ecosystems and future generations.

yam farming fobbbr export

Yam farming, particularly in the districts ofKrachi and Nkwanta, is particularlyproblematic. These areas have undergonelarge-scale conversion of forest lands to

make way for yam cultivation, creatingintense pressure on natural resources. Inaddition, preparing land for yam cultivationinvolves cutting and burning vegetationcover and removing tree roots (to makeway for mounds and to allow tender yamroots to grow without obstruction). In sucha delicate and fragile ecosystem, forestclearance, land degradation and intensivecultivation are a recipe for biodiversity loss,further desertification and food insecurity.Ultimately, the livelihoods of the poorestGhanaians are threatened, rather thanenhanced, by the increasing internationaltrade in yams.

Loss of medicinal plants is also a problem.In the words of Dr. Ayikue Torkpo, aregional herbal medicine practitioner andexpert, the medicinal plants found in theforest savannah zone are amongst themost potent anywhere. He believes thatthe loss of herbs and wildlife throughland degradation poses a significantthreat to the health of local people.

Friends of the Earth Ghana fears that tradeliberalization threatens productive butfragile ecosystems and drylands in Ghanaand the rest of Africa. In the near future, allof the world’s remaining drylands may betransformed into desert lands.

*small island states, food imports and desertification[aldrin calixte, friends of the earth haiti]

Over the past decade, small islanddeveloping countries unilaterallyderegulated and liberalized theiragricultural sectors as part of thestructural adjustment process imposedby the Bretton Woods institutions. Thisliberalization often went much furtherthan commitments entered into at thetime of the WTO’s Uruguay Round oftrade negotiations.

As part of this process, many of thesecountries were granted preferentialaccess to markets in richer countries,enabling them to continue to trade eventhough they were relatively small andtherefore less efficient producers.However, current WTO negotiations,which aim to lower trade barriers in allcountries, would reduce the benefits thatmany of the poorest countries receivefrom trade preferences. Without tradepreferences, products from small islandssuch as coconut, banana, sugar andspices are likely to becomeuncompetitive at the global level.

food imports and environmental decline

Small island states are also increasinglydependent on food imports. Haiti, forexample, now produces only 39% of itsown food, importing 54% and relying oninternational food aid for the balance.

The progressive weakening of economiesin these small island countries is asignificant barrier to governmentsseeking to stem poverty, conservenatural resources, and promote fair andsustainable economies. Decliningincomes also force people to turn toother natural resources, such as forestsand fisheries, to try and eke out a living.

barely a tree left in the forest

In Haiti, for example, some landownershave been forced to give up farmingbecause they simply cannot competewith the agricultural imports that nowflow in freely from other countries.Instead, they overexploit local forestresources to produce charcoal. This,

together with generally increasedpressure on local natural resources overthe years, has led to the disappearance of99% of Haiti’s forests and the accelerationof land degradation and desertification.In turn, food availability and accessibilityare negatively impacted.

In short, trade liberalization has hadnegative impacts on the economic,environmental and social circumstancesof many small island developingcountries, and accelerated desertificationwill continue to threaten people andenvironments in these regions.

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part seven | energy

seven energy

WTO negotiations and regional trade agreements areincreasingly affecting people’s access to and control over energy.Energy underpins our economies, and its costs affect our abilityto cook, keep ourselves warm and travel. However, energy is alsoused wastefully, and our ever-increasing demand for it is causingdangerous global warming which will affect all of our lives.

Transnational corporations make vast profits from energy - threeof Forbes magazine’s top ten corporations – Shell, Exxon and BP- are energy companies. These corporations want to increasetheir profits by reducing the control governments have overenergy policies, and trade and investment liberalizationagreements help them to do this.

calls for energy sovereignty

Fortunately, there is a growing alternative voice: people’smovements around the world are calling for ‘energy sovereignty’,and focusing on how we can develop energy in the interests ofpeople and the environment. Technological improvements alonecannot provide a solution. The international Oilwatch network, forexample, sees energy sovereignty as a means for people to regaincontrol over energy sources. They promote alternative energytechnologies that contribute to the construction of sustainablesocial alternatives and more democratic societies, and generateforms of energy use that will keep people and the planet healthy .

nama: removing standards and labeling

One corporate tool for reducing government intervention inenergy markets is the WTO’s Non-Agriculture Market Accessagreement (NAMA, see page 7). NAMA could be used to reducegovernments’ ability to implement a whole host of energyreduction measures, including energy standards and labelingschemes, which some countries have listed as non-tariffbarriers to trade under WTO rules. It has also been proposedthat NAMA be used to reduce tariffs in the energy sector,potentially decreasing prices and increasing consumption.

Friends of the Earth International has identified 212 instances ofnational legislation that have been ‘notified’ as obstructions totrade during negotiations for the NAMA agreement. It is unclearwhether all these notifications are still on the table, but as theNAMA negotiations are formally intended to reduce or eliminatenon-tariff barriers, many of them could remain in place.Additionally, the range of measures initially notified providesstartling evidence of the ways in which governments intend touse the WTO to challenge environmental standards and labeling.For example, mandatory labeling for electric home appliancesincluding for energy efficiency has been notified, as have fineswhen fuel efficiency in imported cars does not meetmanufacturers’ corporate average fuel efficiency.

trade agreements as barriers to action on climate change

There is clear scientific consensus that climate change isoccurring, and it is one of the most serious environmentalthreats facing the planet today. The fundamental issuegovernments face is how to reduce emissions while limitingdamage and protecting the poor and marginalized, who willbear the brunt of the impacts. Trade agreements and institutionssuch as the WTO have the very real potential to undermine bothnational and international action to address climate change byrestricting government actions, even those legitimatelydesigned to limit emissions.

energy, trade and climate change damian sullivan, friends of the earth australia

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seven energy

At a national level, trade agreements could limit the policy spacegovernments have to reduce national greenhouse gas emissions,for example by limiting the use of policies designed to promotesustainable domestic industries by subsidizing them or ensuringlocal content. Trade agreements could also force governments toabandon laws or regulations (or limit the development of newlaws) designed to reduce dependence on fossil fuels. Finally,trade agreements could lead to increased trade andconsumption of fossil fuel resources as tariffs are decreased inenergy intensive sectors, such as aluminum (which has beenproposed for complete liberalization in the NAMA negotiations).

Internationally, trade agreements could take precedence overenvironmental protection, for example in disputes between theKyoto Climate Protocol and the WTO. Saudi Arabia has alreadyforeshadowed a challenge to the Climate Convention using theWTO. Trade agreements may also define the way in whichemissions trading schemes work by restricting discriminationbetween types of emission units and stopping efforts to supportsmall domestic enterprises during the allocation of emission units.

More fundamentally, the international trade system and theWTO in particular support a global economic system that isdependent on fossil fuels and is fundamentally inequitable andunsustainable. As the New Economics Foundation states,“Wealthy countries, even with the benefit of ‘efficient’information and computer technologies, have failed to make thetransition to ‘weightless economies.’ On the contrary, they areincreasingly heavy, dependent on fossil fuels, polluting and – perperson – generating carbon dioxide at many times thesustainable rate. Furthermore, international trade fails, even inconventional economic terms, to bring human development tothe world’s poorest countries. Maximizing trade for its own sakesets us on a collision course with the limits of social andenvironmental tolerance.”

*dark days of energy privatization in colombia[censat agua viva/friends of the earth colombia]

One corporate tool for gaining greatercontrol over energy is the WTO’s GeneralAgreement on Trade in Services (GATS,see page 8) agreement. GATS will reducethe ability of governments to decide whoowns and runs national energy services,and will restrict their capacity toprioritize social and environmental goalsincluding equity, affordability andenvironmental sustainability.

People in Bogotá and on the Caribbeancoast of Colombia experienced theadverse affects of energy privatizationwhen the Spanish corporations Endesaand Union Fenosa took over electricitygeneration, transmission, distributionand commercialization in a privatizationprocess starting in 1998. Followingprivatization, electricity prices for somepeople rose 500 percent above the initialaverage price.

There have also been arbitrarysuspensions of services to homes, publichospitals and community centers, and1,750 electricity workers lost their jobs.The situation is generating serious socialtensions, especially in underprivilegedareas. World Bank and IMF advice initiallyprompted this privatization, but only theGATS process can lock such changes firmlyin place, ensuring corporate windfalls.

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The current system of global governance is incoherent andunbalanced, and permits the economic and trade priorities ofthe biggest and most powerful countries and companies to rideroughshod over all other concerns within the WTO, regional freetrade agreements and even the United Nations. Thisundermines and is preventing effective international and evennational efforts to promote peace, human rights, social progressand environmental sustainability.

It is increasingly clear that trade liberalization negotiations andrules have a significant impact on biodiversity and a wide rangeof natural resources, including forests, fisheries and food, waterand minerals. Millions of impoverished people around the world– those who are most dependent upon natural resources or theterritories in which they are found – have already lost or standto lose their livelihoods. This is most likely to happen in thosepoorer countries that use relatively high trade measures toprotect small farmers and fisherfolk and the environment, aswell as those that currently enjoy preferential tradeagreements. International trade liberalization agreementsnegotiated without attention to these potential impactsthreaten to make poverty worse, not better.

The way we manage international trade must change. Systemsof intergovernmental collaboration and cooperation need to betransformed. We require a coherent, coordinated and morebalanced form of global governance that integrates peoples’economic needs and the multilateral regulation of trade withother important social and environmental concerns.International trade needs to be recognized for what it is - a

means to an end – and the myth of free trade as a solution topoverty exploded.

Governments need to recognize the importance of vibrant andsustainable local economies, and to consistently acknowledge thelink between access to natural resources and poverty eradication.The environment cannot be treated as an add-on option that canbe dealt with at some hazy point in the future. We are destroyingour environment and impoverishing people right now, and tradeliberalization negotiations are fuelling this process.

The World Trade Organization and regional free tradeagreements like the Free Trade Area of the Americas (FTAA) arealready faltering. This is because they are not delivering whatpeople need. Trade liberalization negotiations need to bestopped and their objectives and impacts independentlyreviewed. Our natural heritage – including forests, fisheries,food, minerals and water - must be separated and protectedfrom the entire trade liberalization agenda. There should be noquestion, for example, of sensitive environmental sectors suchas forests and fisheries being included in the WTO’s non-agricultural market access (NAMA) negotiations. Neither shouldenergy and water services be included in its services agenda.

Governments must remain free to take whatever measures theydeem necessary, including trade measures, to protect our heritageeffectively and improve the lives of those people immediatelydependent upon it. To constrain such action on the basis of short-tem – and inequitable - economic priorities is absurd. In addition,governments need to amend all relevant internationalagreements so that governments cannot be forced intointroducing intellectual property rights on life forms. Farmers’,indigenous peoples’ and local communities’ rights to theirtraditional resources and knowledge should be fully protected.

Alternatives clearly exist and are possible, as is shown in thepages of this publication. Farmers in Colombia, for example, areresisting the impact of cheap imports by establishing their ownlocal markets. Workers in Uruguay have successfully taken overand run an economically successful mill that pays its workersexcellent wages, sources all its inputs locally and nationally andhas encouraged farmers to reintroduce important food securitycrops. In Canada, crab and lobster fishing licenses are strictlylimited to individual fisherfolk with small boats who are obligedto fish the licenses themselves, creating 45,000 new rural jobs.

New concepts are being developed as well. Food and energysovereignty, together with water justice, are the newframeworks within which civil society is beginning to reorganizeitself and its commerce, in order to develop fair and sustainableeconomies. Free trade has had its day. Another world is possible– and necessary.

conclusion

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