November 1997, Volume 4, number 9
What on earth is the Multilateral Agreement on Investment and why should I care about it?
The acronyms and legalese of trade treaties seem deliberately designed to be boring and confusing. But don't ignore the fine print: The corporate lobbyists love this stuff, and we need to understand it. Here are our translations.
The North American Free Trade Agreement between the United States, Mexico and Canada, which took effect on Jan. 1, 1994, makes it easier to move goods between the three countries by reducing certain "trade barriers." These barriers, however, may include critical food-safety standards and other laws that protect public health and the environment. While NAFTA included tough enforcement powers to eliminate these trade barriers, it provides only toothless side agreements to protect the environment and workers.
The General Agreement on Tariffs and Trade, the global big brother of NAFTA, attempts to eliminate certain "trade barriers" (including environment and food-safety laws) by punishing nations with laws that limit trade.
The World Trade Organization, with 130 member nations, was established on Jan. 1, 1995, to enforce GATT. The goal of the WTO is to allow frictionless movement of goods through a single world market. WTO spokesman Hans-Peter Werner says that it's up to WTO officials to "interpret what, legally, is the right of governments."
The Multilateral Agreement on Investment, negotiated in secret by 29 of the world's wealthiest nations, would give corporations new rights to invest wherever they wish without enforcing any responsibilities to the communities they invest in. It would, in some instances, allow foreign investors to sue for compensation if their property values were hurt by land protection or pollution laws in a given country. The fast-track authority President Clinton is asking Congress for includes the right to
implement the MAI.
Through fast-track legislation, Congress delegates to the president its constitutional authority over trade agreements. Members of Congress cannot offer amendments and can only vote yes or no on the agreement the president makes with other countries. Proponents argue that fast track is necessary to assure our trading partners that "special interests" won't pick apart finished trade agreements. In practice, that means that business interests load the trade agreements with provisions that foster trade at the expense of workers, public health and the environment.
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