Free Trade

The most important thing to learn about “Free Trade Agreements” is that it is not “free” and “trade” is not its most important feature. It is not free because it has high human and environmental costs and essentially only gives freedom to the powerful. Its trade element is limited because most Free Trade Agreements are about government rules on intellectual property, competition, services such as water and electricity, State purchases and investment rights with trade in goods being a small component.

Theoretically, free trade agreements are proposed as a way to “liberate” investment and trade by bringing down any tariffs and barriers to commercial transaction, but in reality they are much more about ensuring domination of domestic markets by industrialized countries.

They are of particular significance to Bolivia because they entrench a “free market” politics that has been applied since 1985 that has had huge social costs, generated little wealth for the vast majority of people and damaged the environment. At a time of growing demands for alternatives, Free Trade Agreements would prevent change as each agreement is backed by a binding legal mechanism that can lead to countries being sued for non-compliance.

Bolivia has some experience of “free trade” because these policies were enforced as part of IMF Structural Adjustment Programmes that Bolivia was required to comply with in order to get loans and debt relief. These had the effect of destroying campesino livelihoods as cheap imports made it impossible to sell in local markets. Foreign Investors were given strategic resources at rock-bottom prices and protected by law.

One such company was the US multinational Bechtel who under a Bilateral Investment Treaty sued Bolivia in 2000 when the people of Cochabamba threw out the company after it had taken over their water and vastly increased water rates.

More recently, Bolivia has been under pressure to support the Free Trade Area of the Americas (FTAA) and then the Andean Free Trade Agreement pushed by the United States.

Fundación Solón has not just been active in questioning this dominant ideology but also active in supporting and encouraging social movements to formulate alternative proposals. We actively facilitate the work of the Bolivian Movement for Sovereignty and Solidarity-based Integration of the Peoples, the principal movement that opposes Free Trade Agreements.

We are conscious that our main weakness is our lack of utopias, the false belief that there are no other paths and the loss of confidence in humanity to determine its own future. However we believe in the desire for transformation and the capacity of human beings and therefore in the capacity to construct alternatives.

An alternative model

So what would an alternative model of integration look like if it is constructed from below, from the heart of civil society. In a series of workshops preparing for the Constituent Assembly in 2004 and 2005, the Movement developed some of the following ideas and fundamental principles.

We are looking for a Just and Solidarity based Trade based on the integration of peoples, not agreements that put trade commercial exchange above the environment, health, climate change, labour and cultural rights and human rights treaties.

An alternative model contains unequal rules for an unequal world, respecting the rights of countries to follow the development path that suits them, privileging the smallest economies and positively discriminating in favour of micro-industries and small-scale farmers who are adversely affected by current trading. It refuses to allow for patents on life forms.

A just and solidarity.based trade respects the sovereignty of nations and peoples and does not impose economic, political or military conditions that threaten the exercise of democracy and human rights. In just trade, the State has the right to regulate basic services based on social needs and without profit. The State also has the right to control strategic sectors of the economy via State monopolies.

Trade agreements must be negotiated transparently and with the involvement of civil society, particularly vulnerable groups who can be affected by trade.

This alternative is not anachronistic or other-worldly; simply reclaiming the right of nations to follow the same model of protection that allowed the richest nations in the North to develop and protect their economy and society.