Greed Is Good
Greed Is Good
Remember the summer of 1992? The Conservatives had just been re-elected, George Bush senior was in the White House, Nelson Mandela was negotiating the end of apartheid - and sustainable development hit the headlines. Meeting at the Earth summit in Rio de Janeiro, the world's governments pledged to avert an impending collision between Earth's ecology and the global economy.
As the world prepares for next month's world summit on social development (WSSD) in Johannesburg, the Rio rhetoric is back on the airwaves. Northern governments are treating us to painful cover versions of the old sustainable development classics, and marketing them with more hype than that surrounding the launch of Will Young. Meanwhile, the US and the EU are desperately seeking to pre-empt any discussion of a global economic system that is perpetuating the vicious cycle of poverty and environmental degradation.
The widening gap between rhetoric and reality that has transformed sustainable development into an irrelevant buzz phrase now threatens to turn the WSSD into tragic farce.
Nowhere is that gap more visible than in the UN-prepared statement for adoption in Johannesburg. Three-quarters of the text has already been agreed, most of it of such vacuous inanity as to make a trainspotter's diary look exciting by comparison. The remainder, dealing with issues such as trade and finance, has become the site of a pitched battle between southern governments, environmentalists and development agencies on the one side, and the EU and the US on the other.
The issue at the heart of the divide can be summarised in a single word - globalisation. When the Earth summit took place in 1992, surging flows of trade and finance were already transforming the world, but the "G" word was never even mentioned in Agenda 21, the call to action adopted at Rio. The WSSD now provides an opportunity to align the management of globalisation with the principles of sustainable development.
For the high priests of globalisation, the 10 years since Rio have been an unmitigated triumph - living proof of the benign power of markets. They point out that world output has risen by 50%, with trade and investment driving economic growth. The fact that 1 billion people are still living in poverty - the same number as a decade ago, despite the rising tide of prosperity - is treated as evidence of the need for more growth, and more open markets. Gross and widening disparities in wealth that leave 15% of the world's population controlling four-fifths of global GDP are viewed as a distributional irrelevance.
In this Panglossian bubble, ecological costs can be viewed in a different light. The crazed, carbon-based energy system fuelling globalisation is destroying our ecosystem, and current growth models are based on unsustainable production and consumption systems that are depleting forests, oceans and fresh water.
Nothing better illustrates the tensions between trade and sustainable development than the management of world trade. While the ink was drying on the 271 pages of broad principles outlined in Agenda 21, northern governments and corporate lobbies were shaping the Uruguay Round agreement, complete with the 26,000 pages of binding law overseen by the World Trade Organisation (WTO). The provisions extended beyond tariffs to intellectual property, agriculture, the regulation of foreign investment and even basic services. Sustainable development was added to the preamble as an afterthought.
Many of the WTO's rules flatly contradict the Rio accords and conflict with multilateral environmental treaties. Moreover, the new system has institutionalised deep imbalances in power between rich and poor countries, skewing the benefits of trade towards the rich world. But the multilateral trade system highlights an imbalance in power at the heart of globalisation. The holy trinity overseeing globalisation - the IMF, the World Bank and the WTO - has teeth and muscle, sustainable development has the vague principles of Agenda 21.
For all the flamboyant rhetoric about a "development round", the current WTO talks are intensifying the tensions between trade and sustainable development. The EU is doing its bit for big business in the negotiations on services, demanding that poor countries privatise water systems under the auspices of transnational companies. It has not even bothered with an assessment of the consequences for public health, or the environment.
In the intellectual property negotiations (Trips), Europe and the US are shoulder to shoulder behind corporate self-interest. WTO-sponsored enforcement of patents is being used to extend corporate control over seeds (jeopardising the Convention on Bio-Diversity), to enable drugs companies to inflate the cost of life-saving medicines in poor countries, and to raise the cost of new technologies - including those needed to make the transition from inefficient carbon-based energy systems.
Of course, the WTO has rules against subsidies - well, some of them. The Bush administration can adopt with impunity a farm bill providing an $18bn-a-year top-up to the corporate welfare trough for assorted agribusiness interests, spelling social and ecological disaster for developing countries. Heavily subsidised exports will destroy the local and international markets on which millions of smallholders depend, with devastating consequences for poverty.
While rich countries use their control over IMF-World Bank loan conditions to frogmarch poor nations into rapid import liberalisation, the principles of free trade are applied more selectively at home. Industrialised countries impose import tariffs on developing countries that are four times higher than they apply to each other, denying the latter's citizens a fairer share of the benefits of globalisation.
Of course, increased export opportunities will create tensions. As with any production, there is a danger that ecological costs will be ignored in the rush to generate economic wealth. But this highlights the need to bring export prices into line with real ecological costs, and to adopt a global tax on aviation fuel as part of a strategy on global warming.
Last month, at a preparatory meeting in Bali, African governments insisted that the WSSD communiquÃ© should include commitments by northern governments to improve market access, review current approaches to import liberalisation, and support market interventions to raise commodity prices. They also called for a commitment to increased aid to achieve agreed goals on poverty and the environment, recalling that Agenda 21 had included a promise by rich countries to increase their development assistance to the 0.7% GNP target set by the UN.
In the event, aid was cut by one-third over the next decade, to 0.2% of GNP. The EU and the US have responded in time-honoured fashion. They insist that the place to discuss trade is the WTO, rejecting any reassessment of current IMF-World Bank market liberalisation. On aid, the US maintains that the commitments made at the Monterrey summit of financing for development represent the last word, even though it remains at the bottom of the aid donor league table.
All of which raises an obvious question: namely, what is going to be discussed at the WSSD? Both economic superpowers appear to see the event as an opportunity to exchange vague generalities about unsustainable consumption, while admiring the transnational companies lining up to parade their green credentials on the Johannesburg catwalk.
In the age of globalisation, we cannot afford to tolerate such reckless irresponsibility.
· Kevin Watkins is senior policy adviser at Oxfam.