Food First Trade Principles

In celebration of our 40th anniversary year, Food First is revisiting past publications from our rich archive of analyses on the root causes of hunger and social movements fighting for the right to food around the world. We hope you enjoy (re-)reading these trail-blazing pieces, which remain highly relevant today.

Globalization and the push of trade liberalization still loom large, fifteen years after Food First presented these guidelines for trade policy in a fall 1999 Backgrounder—the same period in which activists fought to shut down the WTO meetings in Seattle. Now, as we find ourselves battling new challenges such as the Trans-Pacific Partnership (TTP) and the Trans-Atlantic Trade and Investment Partnership (TTIP), “Food First Trade Principles” are as relevant as ever.

Since 1973 the income gap between rich and poor nations has grown from 44 to 1 to 72 to 1. The gap between rich and poor within most countries has grown rapidly as well, followed closely by deepening social problems. We have seen increased homelessness and hunger in America, even in times of economic prosperity. Behind this alarming picture lie structural changes in the global economy brought about by rapid increases in trade and capital flows.

Time for New Trade Policy

The time has come to step back from the mania for free trade at any cost, assess the damage, and seek a new start. At Food First we do not suggest that every kind of international trade is bad. Recognizing the positive potential of trade, we ask: Under what conditions could trade contribute to human wellbeing and broad-based development? In that light we present a set of principles to serve as the basis for a different kind of trade policy, one under which the benefits of trade might flow primarily to the countries and communities most in need.

The time has come to step back from the mania for free trade at any cost, assess the damage, and seek a new start.

These principles may sound tough and utopian. Some may say that with these criteria, no trade bill would be passed an no treaty signed. Our answer is that no new trade legislation, and no new trade treaties, or the rollback of existing treaties, would be far better than ones which have massively set back human welfare and the environment. If we can’t do it right, then let’s not do it at all.

Principles to Be Met by Any Trade Bill, Treaty or Policy

Unconditional Debt Cancellation

External debt is the number one obstacle to offering decent social services and fostering broad-based development in every Third World country. The principal reason many governments in Southern developing countries are capital-starved is because of the unsustainable burden placed on them by debt service. Total annual debt payments are currently higher than the sum of all foreign investment, plus all foreign aid.

A centerpiece of any trade-related (or aid-related) bill or policy relating to the Third World must be unconditional debt cancellation, with strong language and legal mechanisms to ensure it happens. Debt cancellation must not be made conditional upon poorer countries modifying any of their own economic policies or laws; in the past onerous conditions have undercut positive benefits of debt relief.

True Participatory Process

Many trade bills before the U.S. Congress have been drafted by corporate lobbyists—representatives of those with the most to gain for the present international trade regime. For example, on the international scene, a lobbyist from Cargill helped negotiate the agricultural portion of GATT.

In the future, the development of any bill or policy must occur through a participatory process with broad representation of “affected” civil society in the U.S. and abroad. Key groups who should participate are unions, farmers’ organizations, consumers’ groups, environmentalists, and community organizations.

No Job Loss

While NAFTA has created jobs in the U.S., Canada, and Mexico, it has led to the elimination of far more. Corporations have benefited at the expense of working people in all three countries, who have experienced downward pressure on wages and working conditions. There should be no likely net job loss either in the U.S. or other countries as a result of any new policy or bill.

No Corporate Welfare

There should be no direct or indirect subsidies, or favored status for transnational corporations (TNCs) included in the bill or policy. That means no export credits or guarantees may be included that help TNCs penetrate Southern/developing country economies to the detriment of local businesses.

Sovereignty Over Basic Economic Policy

All countries must retain the right to establish currency and import controls, set the conditions of trade and investment to meet the needs of their people, and control flows of capital and resources into/out of the country as a legitimate means to achieve domestic economic stability.

No Arms

There should be no subsidies or easing of restrictions for arms sales, nor should military or police training be included.

No Food Dumping

There should be no dumping of foodstuffs (either disguised as “aid” or “trade liberalization”). Cheap imports undercut the ability of local farmers to stay in business, often driving them off the land and into cities; this undercuts long-term national food security and creates dependence on imports. Self-reliance in basic necessities gives countries and communities a stronger bargaining position in the global economy.

Subordinate to Human Rights and National Constitutions

There must be clear and binding language that gives legal precedence over trade agreements to each country’s domestic constitutions, as well as to international conventions and treaties on human rights and the environment.

Featured image: Leaders of Trans-Pacific Partnership (TPP) member states and prospective member states at a TPP summit in 2010.

Click here to read the full Backgrounder including nine additional trade principles.