Civil Society Key Recommendations

• It is urgent that the WTO negotiations change their direction. Rich country governments should recognize that government regulation and interventions provide essential policy space to further economic development. Principally, the governments of the North ought to drop their demands on the countries of the South calling for onerous tariff reductions in all WTO negotiations. Instead, in the sense of Special and Differential Treatment, the countries in question ought to be able to define the speed and extent of further liberalisation steps in line with their development needs.
• The stipulations of the regional and bilateral trade and investment agreements that counter the development targets of Southern countries, especially ACP countries, have to be renegotiated.
• All countries of the North should completely end their subsidies for agricultural exports to the developing countries, especially to Africa. The EU’s deeds should follow its words regarding its announcement to completely eliminate the remaining subsidies for agricultural exports by 2013, independently of the further course of negotiations in the WTO.
• The FFD Review Conference, building on the overarching agenda of Monterrey, should call for an integrated assessment and negotiations, in the context of its follow-up process, to address the trade, financial and monetary pre-conditions for developing countries to utilize trade as a tool for development, the promotion of gender equity and full employment. It should, furthermore, recognize that such conditions are not present in the multilateral system today.

1. The accumulation of domestic capital through trade

   The FFD Review Conference should call for the accumulation of domestic capital for development to be placed at the centre of agricultural, industrial goods and services trade, as well as investment policies. Inter alia, this calls for negotiations on Non-Agricultural Market Access (NAMA), the Economic Partnership Agreements (EPAs), and other Free Trade Agreements (FTAs) to withdraw requirements for developing countries to lower industrial tariff levels, given their potential to jeopardise industrial development, diversification of industries, and the creation of decent and productive employment. Such negotiations must further support the strategic use of tariffs, support and access to technology and the utilization of controls on foreign investment as a key tool to prevent transfer-pricing and erosion of public revenue bases.

2. Exchange rate and financial stability and trade performance (See Section G “Reform of the International Financial System” for further elaboration and recommendations)
3. Aid for Trade and the Multilateral Trading System

   The FFD Review should call for a realistic and joint assessment of what aid and trade both can achieve, as the necessary underpinning of any policies with regard to both aid and trade.

   Member countries should commit in FFD to ensure that recipient countries play the central role in the Aid for Trade decision process. The structures for diagnostic, delivery and monitoring should ensure developing countries are free to use funds to enhance their capacities to advance their interests, regardless of what the donors’ interests might be. Trade-related programs should be untied, unconditional and non debt-creating. Aid for Trade promises should be additional to previously promised increases in aid.

4. The role of international financial institutions and donors in trade negotiations

   The role of the IMF and the World Bank should be redefined away from trade policy. Trade and investment agreements should urgently operationalize effective mechanisms to redress the asymmetric impact that development finance institutions and agencies have had on the negotiating space of recipient countries.

   To be faithful to the principle of ownership it predicates, the OECD’s Aid Effectiveness agenda should drop requirements such as the CPIA or government procurement standards that prejudice the role and direction of trade policy in the development strategies of recipient countries.

5. Financial issues in free trade and investment agreements

   Trade and investment agreements should incorporate the lessons from past financial crises by avoiding impinging upon the flexibility to manage the financial sector, the capital account and sovereign debt.

   Supporting the ILO’s Decent Work agenda

   National economic policies need to foster the creation of decent work for all as a key step towards poverty reduction, gender equality and equitable growth. This includes training that improves women’s options across different sectors of the labour market, and access to finance for women entrepreneurs, especially in small and medium enterprises. Policies to create decent work should fully account for rapid changes in labour markets and opportunities related to trade liberalization. They should include labour adjustment measures such as training and redeployment. Social dialogue and social protection measures are key, as well as recognition of workers’ rights to join trade unions and bargain collectively for a fair share of the productivity gains of their labour.