Acceding Countries as Pawns in a Power Play: a case study of the Pacific Islands

Jane Kelsey

I would like to begin my comments with a plea made by the Deputy Prime Minister and Finance Minister of Samoa - one of three small islands in the South Pacific that are undergoing the torturous process of WTO accession: [1]

We, the small states of the pacific, and the world, feel as though we are the mice who catch pneumonia when the elephants sneeze. We would ask the big powers to tread softly, for you tread not only on our lives, but also on our livelihoods.[2]

Similar and persistent appeals for sensitivity in WTO accessions have fallen on deaf ears.[3] The problem, according to a senior Samoan negotiator, is that the supposedly ‘rules based organization’ has no rules. Others who have an intimate knowledge of Vanuatu’s stalled accession put it more sharply: ‘the accession process has no rules, except precedent and power, and is the very antithesis of what the members publicly state to be the intention and design of the WTO’.[4] The General Council Decision of 10 December 2002, which pledged sensitivity to development needs and self-restraint towards least developed countries (LDCs),[5] has not made the slightest difference. Nothing mocks the claim to a Doha ‘development’ agenda,[6] and delegitimates the WTO even further, than the power politics of accession.

While all eyes are fixed on the fate of the Doha Round, it is important to recognize that most of what the South is rejecting has already been forced, arrogantly and invisibly, onto some of the world’s smallest, poorest and most vulnerable countries.

Vanuatu is a group of 83 islands with 200,000 people. Samoa has a population of 177,000 and Tonga 100,000. Vanuatu and Samoa are LDCs. No one denies that these countries face enormous challenges. They are typical of small, geographically isolated and environmentally vulnerable island states.[7] The majority of their people are subsistence farmers.[8] Tariffs provide between one fifth and almost half of government revenue.[9] They run chronic and growing trade deficits.[10] They export a small number of commodities,[11] assisted by preferential access to Australia and New Zealand under SPARTECA and the EU under Cotonou that is now eroding. The main services ‘trade’ is tourism, and for Vanuatu offshore banking.[12] In recent years imports of cheap, low quality foods has undermined local self-sufficiency. Population growth rates are high. HIV/AIDs infection is growing, as are lifestyle diseases such as diabetes and heart disease. Inequality has become more noticeable, especially between rural and urban communities. Families depend heavily on remittances.[13] Their political situation is relatively stable in a quite unstable region, but each has had its controversies. Like other members of the Pacific Islands Forum they depend heavily on the patronage of Australia and New Zealand who aggressively protect their ‘patch’.[14] As the Australian newspaper put it: ‘Australia is often said to be the superpower of the South Pacific. If so, then New Zealand is certainly the second, with Wellington playing London to Canberra’s Washington.’[15]

Vanuatu completed its accession in 2001, after six tortuous years - only to put it on hold, citing ‘technical reasons’, days before the Doha ministerial. Stepping back from the pressure, the Treasury and politicians believed they had given away too much.[16] Recently, Vanuatu has begun to reactivate the process,[17] but wants to reopen the bilateral phase, especially on the far-reaching services offer on wholesale and retail trade, health, environmental, audiovisual, legal, professional and technical services it was bullied by the US into making.[18] They also want guaranteed rights to the TRIPS health waiver. There does not seem to be any legal basis for revisiting an accession package that has been signed off on, which leaves Vanuatu to the mercy of the General Council.[19]

Tonga began its process in 1996 and has bilaterals with the US and EU yet to do. Samoa applied for accession in 1998 and is, to quote, ‘taking its time’. Like all acceding countries,[20] they have faced outrageous demands for WTO-plus commitments from the self-nominated members of their Working Parties.[21] Samoa’s senior trade consultant objects that the right of veto means there are no negotiations: ‘They can ask for all sort of commitments which Samoa isn’t in a position to offer. If they insist, there are 2 options: we will never become a member or we have to give in to that request.’[22]

The Islands, like Cambodia and Nepal before them, are pawns in a global chess game that has nothing to do with their needs or the harm that would result if they gave in.[23] It is about creating precedents that provide leverage in multilateral negotiations or important accessions. Each favourable new precedent sets a progressively higher benchmark. The most pressing demandeurs have been Australia, New Zealand and the EU – plus the US, even though it barely trade with the Islands. The US has focused on tariff bindings, GATS, TRIPS, TRIMs and procurement,[24] while the Cairns Group members New Zealand and Australia target tariff bindings, export subsidies, domestic support and special safeguards measures for agriculture.[25] The Europeans have reportedly made fewer demands on the Pacific, but their turn will come when negotiations for a Pacific REPA under Cotonou begin later this year.[26]

Because the process is shrouded in secrecy, critics and analysts – let alone parliamentarians and citizens – have no idea of what is at stake. Fortunately, the Vanuatu case is now well-documented; [27] similar secrecy will be different next time around, especially as is may become an election issue later in the year.[28] Some information is slowly emerging on Tonga and Samoa; NGOs and the media are asking questions, especially in Samoa.[29] But there are no proper social impact studies and no open public debate about the kind of development they are being locked into. Let me give a couple of examples.

Both Tongan and Samoan officials concede that WTO accession offers no real commercial gains.[30] Samoa currently exports all that it can and has access to ‘Everything But Arms’, so long as that lasts. Tonga’s main export barriers are small scale, limited land, access to finance, natural calamities and climatic conditions, falling commodity prices, low priced international competition, remoteness, high transport costs, insufficient expertise and advise on diversification, and onerous standards and SPS requirements from richer countries.[31] None of these will be addressed through accession and may become worse.

New Zealand supplies around one third of Tonga’s imports. About one third of that is foodstuffs. Last month, New Zealand’s Trade Minister hailed the completion of Tonga’s bilateral negotiations as ‘saving’ New Zealand exporters $6 million in tariffs.[32] Put another way, Tonga, which currently draws over 40% of government revenue from border duties, will need to make up a $6 million fall in revenue. The options are user charges, broader sales tax or a consumption tax[33] - in a country where 80% of the people are subsistence farmers whose cash income is largely from remittances.[34]

Similar demands are being made of Samoa. Why? The Islands don’t produce competing products domestically; Tongans and Samoans would buy the products, with or without tariffs. Trade theory reassures us that price savings will compensate. But delicensing of Australian rice imports into Vanuatu made not different to the monopoly there, because that’s how the Australian exporter likes it. Prices haven’t dropped either.[35]

Indeed, there are sound development reasons for hoping that the prices won’t fall. Around one third of New Zealand’s meat exports into the Pacific are a fatty waste product known as ‘mutton flaps’. A 2001 World Health Organization report drew explicit links between dependence on imported foods, especially mutton flaps, diet-related disease and trade liberalization.[36] It found that, despite effective education and awareness programmes, people were making economically rational, but nutritionally detrimental, decisions to eat less healthy foods because they were cheap and available. That year Fiji, a WTO Member, announced a ban on mutton flaps, citing proven links to obesity; New Zealand threatened action at the WTO.[37] Tonga then urged the New Zealand government to end mutton flap exports and encourage a return to healthier traditional diets, such as fish, organic chicken[38] and taro that simply can’t compete in Tonga’s small domestic market. One New Zealand MP replied that Tongan businesses had the right to decide what to import.[39] At the same time, one of NZAID’s priorities is to fund health programmes in Tonga.

The direct socio-economic impacts are more obvious. US demands that Vanuatu immediately reduce its tariffs to 15-25 per cent would, to quote officials,

‘have thrown Vanuatu’s tiny private sector into competition with globally competitive neighbouring economies and probably would have made many businesses bankrupt’. .. [I]n Vanuatu the closure of even one major company would constitute a major blow to employment and aggregate economic growth. WTO entry could be expected to raise unemployment over the short term in manufacturing, construction, retail and wholesale, hotels and restaurants, and finance and insurance. Together these sectors comprise 47 per cent of employment.’ [40]

In agriculture: ‘It is likely that the swift abolition of price supports to the majority of farmers who live in outlying islands would have left them without any income.’

Other issues, such as the affordability of medicines for life threatening disease, ecological sustainability through local processing of timber or fish,[41] survival of small local shops faced with growing numbers of Asian wholesalers, and retention of land in customary ownership – which is a Constitutional guarantee in Vanuatu[42] – have the potential to make or break governments, as well as decide the future of their societies.[43]

The price of accession is intolerable in another way. Tonga says it gravely under-estimated what was involved. [44] There are simply not the people to do all the work, however far they stretch themselves. Vanuatu estimates the process cost it US$150,000. It cost US$20,000 a year cost for observer status – which is the entire budget of the Department of Trade. By the end, Vanuatu owed the WTO US$170,000 in unpaid fees. [45] The government’s total annual expenditure is just US$60 million. Once a member there are the costs of participation[46] and the burden of implementation (notably standards and quarantine) with threats of enforcement if they ‘fail’.[47]

That is just for the WTO. At the same time the Islands will have to manage negotiations with the EU for a Pacific REPA before the end of the year that are more extensive than the WTO, including the Singapore issues. Plus, Australia and New Zealand insist that once the REPA negotiations begin, the Islands must enter into parallel negotiations under PACER. Australian Prime Minister Howard has signaled the end game - a full ‘EU-style’ Pacific Economic Community, including a common currency and pooled governance and security arrangements, which of course Australia would lead.[48]

It is time to challenge those countries whose abusive practices are protected by the shroud of secrecy. New Zealand and Australia proclaim a special relationship with the South Pacific. But, as one New Zealand government representative frankly admitted to me: “When it comes to trade, there is no special relationship to the Pacific. They [the negotiators] do a group hug, then put their Geneva hats on.”[49] Australia and New Zealand reportedly threatened to cut off technical assistance to Vanuatu’s agricultural sector, which help fund its diversification programme unless it abandoned rights to use price supports, special safeguard measures and export subsidies, [50] and claimed that ‘Uruguay Round methodologies are not available to acceding countries. The lead came from the top. Former Director General Mike Moore proclaimed in a video-link to the first Trade Policy Course for Pacific Island countries run by the WTO and Forum Secretariat in March 2001,

‘It is my duty as Director-General to ensure you receive all the necessary and possible technical support to accelerate your applications. I will also work to ensure that undue pressure beyond the established rules is not placed on acceding countries’.[51]

Yet, one account says Moore’s Secretariat[52] warned Vanuatu that its accession would be denied unless it gave into US demands and took strong commitments on wholesale and retail trade, after which the negotiators changed course.[53]

There is no tolerance for contestable advice. In October 2003, The Guardian revealed a letter in which a senior British trade official and a London-based New Zealand diplomat discussed plans to monitor a Commonwealth Secretariat official at the Cancun ministerial and the need to ensure his contract was not renewed.[54] The official, Roman Grynberg, had given critical advice to Southern governments about the Doha Round and written numerous papers on the risks that such negotiations posed for the Pacific Islands.[55] He had been intimately involved in Vanuatu’s accession and was blamed for the Islands reluctance to include Australia and NZ in a regional trade agreement. A colleague working in Geneva was also reportedly targeted for giving ‘unhelpful’ advice to the LDCs.

The ‘Dracula principle’ of bringing daylight to bear on such behaviour can only achieve so much. In a recent report prepared a report for Pacific NGOs entitled Big Brothers Behaving Badly, [56] I exposed the tactics of Australia, often backed by New Zealand, which led to the PACER agreement. These included the familiar ploy of bypassing the more informed negotiators to pressure the politicians in the capitals. Small teams of officials were deluged with technical proposals they had no capacity to process. The Pacific response to the aggressive style of Australia and New Zealand was silence, which was interpreted as consensus. There was also full frontal bullying – shouting at, berating and intimidating officials, negotiators and consultants. One New Zealand consultant said:

The public behaviour of the Australian officials at some of the meetings was appalling. … Their private behaviour, at its worst, descended to levels that I regard as totally unacceptable The whole experience was stressful and demoralizing for me, let alone for the Pacific Islands negotiators. There were times that I felt ashamed to be a New Zealander; I was just pleased that I was not an Australian.[57]

Trade Minister Jim Sutton’s countered that Australia and New Zealand had behaved ‘impeccably’, then let forth a stream of personal abuse that proved the point.[58]

Similar attitudes flow through the accessions, although apparently New Zealand’s behaviour has improved since the PACER report was released. But that doesn’t alter the substance. To quote the Samoan’s adviser:

“The unfortunate thing about the United States is they are very arrogant and treat every country the same. … One would expect that Australia and NZ will understand about us more …. If New Zealand should insist that our binding rate should be zero … what happens then is Samoa or the Government will have to decide whether the price of joining WTO is too high – it is as simple as that. Eventually it will be up to the Government to make that decision. If we negotiate, we have a mandate but if what the country is asking of us is outside of the mandate and we cannot negotiate, then it’s time off. … We are going there with our eyes open. That is why we are not rushing into things.”[59]

In other words, the power politics may backfire. The Pacific Islands have nothing to gain and everything to lose from joining a club that has the potential to devastate their economies, cultures and societies, and create enormous instability and turmoil in an already unstable region. Once they enter the WTO, they will be trapped within an economic paradigm of global markets that is being pushed onto the Pacific by the World Bank,[60] Asian Development Bank (ADB)[61] and IMF,[62] and that is profoundly anti-development and anti-democratic. Those who advocate this model on behalf of the institutions see this as the real benefit of WTO accession. By “locking in” such reforms internationally, WTO accession provides governments with a defence mechanism against future policy backsliding or “de-liberalization” in response to domestic protectionist pressures’.[63] ‘Sensible’ governments would realize the need for reforms; ‘super-sensible’ governments would implement reforms that exceed WTO requirements.

Grynberg, by contrast, questions the inappropriateness of these policies for the Islands and doubts they are stable or strong enough to weather the severe political and economic consequences of the very long and difficult transitions that these policies would require. [64] Others of us are convinced that there is already enough evidence that this paradigm has failed the people of the Pacific.[65] It is not a question of whether these Islands can afford to say ‘no’ to the WTO. They cannot afford not to.


Adhikari, R. and N. Dahal, (undated) ‘LDCs’ Accession to the WTO: Learning from the Cases of Nepal, Cambodia and Vanuatu’, South Asia Watch on Trade, Economics & Environment (SAWTEE), Kathmandu, Nepal

ADB (2004), ‘Discussion Paper. ADB Pacific Strategy 2005-9: Responding to the Priorities of the Poor’, Manila: ADB

AID/WATCH (2004) Press release: ‘Downer puts ‘Governance’ before sustenance in aid budget’, 11 May 2004

AUSAID (2003) AUSAID Seminar on Trade and Devvelopment, Sydney 17 November 2003

Bosworth, M and R. Duncan (undated) ‘Current Status of the WTO Accession Process and the Experience of ESCAP Acceding Countries’, ESCAP

Charveriat, C. and M. Kirkbride (2003) Cambodia’s Accession to the WTO. How the law of the jungle is applied to one of the world’s poorest countries’, OXFAM International http://www.cancun2003.org/en/web/216.html;

Choudry, A. (2002) ‘Killing me Softly’, ZNet Commentary 3 August 2002 http://www.zmag.org/sustainers/content/2002-08/03Choudry.cfm

CNN (2001) ‘Pulled out of WTO accession process’, 13 November 2001, CNN.com/2001/BUSINESS/asia/11/13/Vanuatu.sope.biz

DFAT (2000) Australian Government Department of Foreign Affairs and Trade, ‘The Government’s Key Market Access Wins for Agri-Food (Mid 1996 – 25 February 2000)’, www.dfat.gov.au/ma/pf/mawins4.html

DFAT (undated), Australian Government Department of Foreign Affairs and Trade , ‘WTO accessions and how Australia stands to benefit’, www.dfat.gov.au/trade/negotiations/accession/;

Evans, M et al. (2001) ‘Globalization, diet and health: an example from Tonga’, 79(9) Bulletin of the World Health Organization 856

FAO (undated) ‘Adjusting the changes in the global trading environment’, in FAO and SIDS: Challenges and emerging issues in agriculture, forestry and fisheries, www.fao.org/DOCREP/006/Y5203E/y5203e01.htm

Finger, M. and Schuler (2000) ‘Implementing the WTO Round Commitments: The Development Challenge’, The World Economy, 511

Gay, D. and R. M. Joy, (undated) ‘Vanuatu’, ESCAP

Government of Fiji (2001), ‘Health of Fijians more important than NZ threats’, Government Press Release, Suva, 15 March 2001 www.fiji.gov.fj/press/2001_03/2001_03_15-01.shtml

Government of Samoa (2003) ‘Country Programme outline for Samoa’ (2003-2007), Apia

Government of Tonga, (2001) ‘Report from Tonga’s First Working Party on its Accession to the World Trade Organization that was held in Geneva, Switzerland from 23 to 27 April 2001’, www.pmo.gov.to/aud1grp.html

Government of Vanuatu (2004) ‘WTO After Cancun’ – the perspective of Vanuatu’, powerpoint presentation

Grynberg, R. (undated) ‘The Pacific Island States and the WTO: Towards a post-Seattle Agenda for the Small Vulnerable States’, Forum Secretariat: Suva.

Grynberg, R. and R.M. Joy, (2000) ‘The Accession of Vanuatu to the WTO: Lessons for the Multilateral Trading System”, 34(6) Journal of World Trade p.159

Grynberg, R, V. Ognivtsev and M. Razzaque (2002) Paying the Price for Joining the WTO. A Comparative Assessment of Services Sector Commitments by WTO Members and Acceding Countries, Commonwealth Secretariat: London, p.41

Hayashi, M. (2003) ‘Arrested Development: Vanuatu’s Suspended Accession to the World Trade Organization’, Case Study prepared for the International Commercial Diplomacy Project: Geneva;

IMF, (2002) ‘The IMF report on the 2002 Article IV Consultation with Vanuatu did urge a ‘reinvigorated effort at WTO accession’, www.imf.org/external/np/sec/pn/2002/pn02134.htm

ITC, (2004) ‘Tonga: National Export Strategy: Scope, Focus and Process’, January 2004

Kelsey, J. (2004) Big Brothers Behaving Badly, Suva:PANG www.pang.org.fj

Lewis, P. (2002) ‘Negotiating with Unequal partners: Small States in the New Global Economy”, Foundation for Development Cooperation Symposium, University of Queensland, South Pacific Futures, July 2002 (draft paper)

Moore, M. (2001) ‘WTO/FORSEC Trade Policy Course for Pacific island Countries, Fiji 5-9 March 2001

O’Fa, S. (2004) ‘Tonga’s perspective – Post-Cancun’, Trade Policy Unit, Ministry of Labour, Commerce and Industries, Government of Tonga

Retzlaff, M.T. (2002) ‘Samoan Leader Discusses U.S. Role in Foreign Politics’, Georgetown University 2002 www.thehoya.com/news/100102/news4.htm

Sharma. S (2003) Media Statement, ‘IMF-World Bank-WTO Close Ranks Around Flawed Economic Policies’, Institute for Agriculture and Trade Policy, 12 May 2003

Slatter, C. (2003) ‘Will Trade Liberalization Lead to the Eradication or the Exacerbation of Poverty?’ CID Trade Forum Proceedings: February 2003, Wellington: Council for International Development

Slatter, C. (2004) The Politics of Economic Restructuring in the Pacific with a case study of Fiji, PhD thesis, Massey University, New Zealand

Stoler, A. L (2003), ‘The Current State of the WTO’, Workshop on the EU, the US and the WTO, Stanford, March 2003

UNCTAD, (2003) WTO Commitments by Cambodia, Nepal and Vanuatu – Comparative Table, 18 September 2003/VO/MH/DITC, UNCTAD, p.26

‘Vanuatu’s Suspended Accession’, (undated) www.commercialdiplomacy.org/case_study/vanuatu2.html, Annex Table 2

‘Vincent Chronicle No 14 – Our Social Security’, 31 July 2003, www.news.vu/en/opinion/Chronicles/269.shtml

World Bank (2002) Embarking on a Global Voyage: Trade Liberalization and Complementary Reforms in the Pacific, Pacific Islands Regional Economic Report, World Bank: Washington

* Professor Jane Kelsey (LLB Hons), BCL(Ox), MPhil(Camb), PhD, of ARENA and the University of Auckland, New Zealand, paper to WTO Public Symposium ‘Multilateralism at the Crossroads’ 27 May 2004

[1] Article XII of the Marrakesh Agreement Establishing the World Trade Organisation states: ‘Any State or separate customs territory possessing full autonomy in the conduct of its external commercial relations or for the other matters provided for in this Agreement and the Multilateral Trade Agreement may accede to this Agreement, on terms to be agreed between it and the WTO’.

[2] Retzlaff (2002)

[3] Dhaka Declaration of the Second LCD Trade Ministers’ Meeting 2003 (WT/L/521)

[4] Grynberg and Joy, (2000) p.172

[5] Decision of the General Council on Streamlining Accession of the LDCs, dated 10 December 2002 states: ‘WTO Members shall exercise restraint in seeking concessions and commitments on trade in goods an d services from acceding LDCs, taking into account the levels of concessions and commitments undertaken by existing WTO LDC Members’; and ‘Acceding LDCs shall offer access through reasonable concessions and commitments on trade in goods and services commensurate with their individual development, financial and trade needs, in line with Article XXXVI.8 of GATT 1994, Article 15 of the Agreement on Agriculture, and Articles IV and XIX of the General Agreement on Trade in Services’.

[6] Paragraph 42 of the Doha Declaration states that: Accession of LDCs remains a priority for the Membership. We agree to work to facilitate and accelerate negotiations with acceding LDCs. We instruct the Secretariat to reflect the priority we attach to LDCs’ accessions in the annual plans for technical assistance. The draft Ministerial Texts for Cancun said: ‘We continue to attach great importance to concluding accession proceedings as quickly as possible and, in particular, to accelerating the accession of least-developed countries. In this regard, we reaffirm the guidelines to facilitate the accession of LDCs adopted by the General Council on 10 December 2002’.


[7] see FAO (undated)

[8] The Samoan government reports that village studies show 78% of families in urban villages have one waged worker, compared with 37% in other locations: Samoa (2003). Gay and Joy (undated) estimate that 80% of Vanuatu’s population depend on subsistence farming, with the cash economy centred in two towns

[9] Samoa receives about 20% of revenue from tariffs, while approx 46% of the Tongan government revenue is from customs duties and the Port and Services Tax.

[10] Tonga 2002: merchandise exports US$9 million; merchandise imports US$70 million; Samoa 2002 exports ST$46,284; imports ST$454,227

[11] Vanuatu depends largely on copra, cocoa, cattle, forestry, with fishing, offshore financial services and tourism; Tonga on agriculture (squash, vanilla), tuna fishing, tourism; Samoa on fish, beer, taro and garments.

[12] All three islands have been accused of ‘harmful tax competition’ by the OECD and have taken some regulatory steps in response.

[13] It is believed that more Samoans and Tongans now live outside the countries than in them.

[14] Tonga, for example, received $US5.5 million from Australia and $NZ2.3 million from New Zealand in aid. The 2004 Australian budget has injected A$432 million into the AUSAID budget; A$208 million will be spent on police and military operations in Solomon Islands and Papua New guinea, most of which will boomerang back to Australian government agencies. AIDWATCH (2004)

[15] The Australian, 25 August 2003

[16] Vanuatu is one of three Pacific Island countries that has also chosen not to join the regional free trade agreement among the islands (PICTA) or PACER with Australia and New Zealand, even though the Parliament has passed the necessary legislation.

[17] Government of Vanuatu (2004). The IMF has been pressing for this; IMF (2002)

[18] Vanuatu’s extensive services commitments covered professional services; basic and value-added telecom, environmental, wholesale, retail, insurance, banking. hotels and restaurants. primary, secondary, higher, adult and other education, sewage, refuse disposal, sanitation and similar, general construction for buildings.

[19] Apparently, a letter was circulated by the General Council on the Vanuatu accession in early May 2004 but it’s content has not been made public.

[20] Charveriat and Kirkbride, (2003); Adhikari and Dahal, (undated)

[21] 15 WTO members and observers attended Tonga’s first Working Party meeting: Australia, New Zealand, Japan, India, Mexico, European Commission (on behalf of the 16 Members of the EU, US, Canada, Hong Kong China, and Observers: Chinese Taipei, WIPO, UNCTAD, World Bank and IMF. Government of Tonga (2001)

[22] Interview with Tuala Falani Chan Tung, Sunline, April 2004

[23] Recently, for example, the New Zealand Trade Minister has confirmed that export interests are the sole consideration in its requests for education services. Written parliamentary question 06455(2004) 25 May 2004

[24]Vanuatu’s Suspended Accession (undated) ; Charveriat and Mary (2003)

[25] DFAT (undated) is reasonably coy about the position, but makes no reference to the position of LDCs; actual achievements are described in DFAT (2000)

[26] For similar issues in relation to the Caribbean, see Lewis (2002)

[27] Hayashi (2003); Grynberg and Joy (2000); D. Gay and R. M. Joy (undated) ‘Vanuatu’, UNESCAP: Bangkok; UNCTAD (2003)

[28] This is a politicised issue. In June 2003 Opposition leader Willy Jimmy expressed doubts that resurrecting the accession was in the national interest.

[29].O’Fa(2004); Interview with Tuala Falani Chan Tung, Sunline, April 2004

[30] O’Fa (2004): he suggests that any potential benefits will depend on the policy reforms that accession puts in train.

[31] O’FA (2004); Interview with Tuala Falani Chan Tung, Sunline, April 2004

[32] Hon Jim Sutton, ‘NZ signs WTO accession agreement with Tonga’, 8 March 2004

[33] Tonga has introduced a tax reform bill but it will be difficult to implement.

[34] ITC (2004)

[35] Grynberg and Joy (2000) fn 9

[36] Evans (2001)

[37] Government of Fiji (2001)

[38] A ban on imported, often low quality, chicken to promote an infant industry of organic chicken became a politically charged issue and seems not to have been enforced. ‘Ban on imported chickens never respected’, 19 September 2003, www.news.vu/en/news/national/667.shtml

[39] Choudry (2002)

[40] Gay and Joy (undated), p. 299, 296

[41] Grynberg reports that the WTO objected to measures by PNG and Solomon Islands to move away from exports of unprocessed raw materials as an undesirable departure from comparative advantage, leaving them to export unprocessed forest and marine products while other countries processed them. He observes ‘It is difficult to imagine a policy prescription that is more odious to Pacific island policy makers’. R Grynberg (undated)

[42] Vanuatu’s post-Independence Constitution says “All land in the Republic belongs to the indigenous custom owners and their descendents’. Investors have 75 year leases and this seems to cause few real problems.

[43] Commentator Vincent Boulekone explains that customary land tenure is also seen as the main source of social security protection, including ‘pensions’. ‘Our people will be welcomed by their ancestral villages where custom and solidarity remain strong, at least outside the urban zones. But the question is: what is going to happen if, as recommended by the WTO and other international organizations, all the community lands have been registered for the profit of a few individuals in each clan and tribe? The ‘unproductive persons’ will have no option, after many years of work, but to remain in urban zones, and we all know what this would mean regarding social and ethnic conflicts. Just as in Africa, or in the Solomon Islands, the deterioration of life, even the possibility of wars, will inevitably cause civil unrest following the take-over of power by a dominant population from other islands.’

[44] According to Tonga’s Trade Policy Unit: ‘As is to be expected, Tonga has found the accession process to be cumbersome and tedious with human and institutional constraints prolonging the exercise. The true extent of the work involved was however not appreciated by Tonga at the beginning of the process. The extensive workload has been compounded by the fact that reform required for WTO accession has coincided with whole scale governmental reform.’ O’Fa(2004) Ahikari and Dahal report that Nepal was required to answer some 365 questions, 24 on economy, economic policies and foreign trade, 178 on the framework for making and enforcing policies affecting foreign trade in goods and services, 114 on trade-related intellectual property rights regime and 48 on trade-related services regime. Adhikari and Dahal, (undated) p.3

[45]World Bank economists have estimated that implementation of quarantine, standards and customs systems can cost the whole years’ development budget of a least developed country. M Finger and Schuler,(2000). They warn that poor implementation may result when governments do not feel a sense of ownership and ‘attempts to force implementation through the WTO settlement mechanism would likely reinforce the impression that the WTO rules are imperially imposed from the outside, for the benefit of the outside’, p.513

[46] One former US official observed ‘I think it is crazy to force a country like Vanuatu to spend years negotiating accession to the WTO when we already know that at the end of the day, Vanuatu won’t be represented in WTO meetings in Geneva.’ His solution was to formalize the imbalance of power by a two-tier WTO. Stoler (2003)

[47]One AUSAID paper puts the figure for implementing WTO related reforms at US$400 million, but that sounds excessive. (AUSAID, 2003) Australia and New Zealand are obliged under PACER to fund a Regional Trade Facilitation Programme but signing of the Memorandum of Understanding has been deferred twice now because of major disagreements over the amount they will provide. In July 2003, Australia announced A$500,000 ‘to assist small nations, including Pacific Island states to develop sufficient institutional capacity to further their trade interests at the WTO’. Australia had already provided initial funding of A$176 million in 2002 for the Agency for International Trade Information and Cooperation (AITIC), As Shefali Sharma observed in 2003 ‘No amount of technical assistance in implementing policies that, in effect, handicap and shackle developing countries in the WTO can improve gains towards development’.

[48] That goal has recently been endorsed by the ADB (2004.

[49] Kelsey,(2004), p.30

[50] The right to use Special Safeguard Measures under Art 5 of the Agreement on Agriculture (AoA) must be reserved at the time of accession. Art 15 of th e AoA exempts LDCs from commitments to reduce price support.

[51] Moore (2001)

[52] The Secretariat’s mandate to work for existing WTO Members leads Grynberg et al to suggest it has a conflict of interest in accessions, Grynberg et al (2002)

[53] Hayashi (2003) One informal source suggests the Secretariat played an even more direct role. Grynberg and Joy also note the conflict of interest for a Secretariat that is there to serve its existing members.

[54] The Guardian, 12 October 2003

[55] R. Grynberg (undated); Grynberg et al (2002)

[56] Kelsey (2004)

[57] Kelsey (2004), p.16

[58] ‘Sutton Attacks Kelsey Personally’, 5 April 2004, www.scoop.co.nz

[59]Interview with Tuala Falani Chan Tung, Sunline, April 2004

[60]World Bank (2002)

[61] Outlined most recently in ADB (2004)

[62] In Vanuatu, accession was strongly linked to the Comprehensive Reform Programme the ADB insisted on in 1998. Gay and Joy (undated) p.287

[63] Bosworth and Duncan (undated), p.10

[64]‘What is not accepted is that some island states may be so small, isolated and vulnerable that it is difficult to imagine what combination of internal adjustment policies would induce substantial domestic or foreign investment. Many SVEs suffer from very high operating costs stemming not from policy induced measures but from the inherent nature of small, isolated and physically dispersed economies’. Grynberg (undated

[65] These are comprehensively documented in Slatter (2004); see also Slatter (2003)

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