Debt and trade activists: No to aid for unfair trade!

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Joint Press Release, Manila: September 19, 2007

Debt and trade activists staged a picket at the Asian Development Bank (ADB) Manila office Wednesday and stressed that the “Aid for Trade” being pushed by World Trade Organization (WTO), international financial institutions (IFIs) especially ADB, and the powerful G-8 nations is “nothing but a bribe” or a “dangling rotten carrot” in front of developing countries. The protest coincided with the two-day regional review meeting sponsored by the WTO, ADB and the Philippine government, in Manila. Dubbed “Mobilizing Aid for Trade: Focus Asia and the Pacific,” the meeting aims to discuss “how to empower less developed economies and small states to benefit from global trade.” DB President Haruhiko Kuroda and WTO Director General Pascal Lamy kicked-off the conference on September 19.

Carrying placards that say “No to Aid for Unfair Trade,” various progressive organizations exposed that it is through the nexus of debt domination and exploitative trade that IFIs, rich governments and global corporations continue to condemn the poor countries to poverty and deprivation.

“ADB and WTO are acting like philanthropic institutions when they talk of ‘Aid for Trade.’ But this initiative is more about aiding unjust trade rather than helping poor countries build their capacity to develop. It’s a win-win solution for WTO chief Lamy and ADB President Kuroda. They get to promote their ambitious trade liberalization agenda and project themselves as pro-poor philanthropists!” stressed Joseph Purugganan of Stop the New Round! (SNR) Coalition.

“With the world already burdened by odious and illegitimate debt mechanisms, bribes are being used to break the deadlock of the stalled WTO negotiations in Hong Kong – called ‘Aid for Trade’ – with the United States, European Union, and Japan offering such a carrot. By dangling his rotten carrot in front of developing countries, the rich and powerful nations hope to slam open the closing doors to profits from their goods and services from the poor people of the world,” said Jubilee South – Asia-Pacific Movement on Debt and Development (JS-APMDD). Meanwhile, Josua Mata of the Alliance for Progressive Labor echoed that the ‘Aid for Trade’ is nothing but a grand plan to bribe the Global South to accept the lopsided Doha development round.

“We don’t need more ‘aid’ or loans, we need fairer trade. Instead of aid, we need the flexibility of using trade for development, not the one-size-fits-all formula peddled by WTO,” he said.

The Freedom from Debt Coalition stressed that the people are not deceived by this ‘Aid for Trade’ initiative. “The reality is majority of the aid comes not in the form of grants, but loans—loans that would only put the people of the South deeper in debt and abject poverty,” said Francis Isaac of FDC, also a member of NGO Forum on the ADB.

“The loans sharks, masquerading as donor agencies, use aid and loans or debts as leverage to further the privatization,” said Bukluran ng
Manggagawang Pilipino.

ODA Watch explained that ‘Aid for Trade’ is a ‘tied aid.’ The privatization-enabling conditionalities are attached to aid-supported projects such as the construction of big dams and hydropower facilities which have displaced entire communities, dislocated livelihoods, devastated indigenous peoples and cultures, and irreversibly destroyed the environment.
Rice Watch and Action Network (R1), in a statement, recalled the ADB’s Grain Sector Development Program (GSDP) loan to the Philippine government in 2000, adding that it was tied on the condition that the government will privatize the National Food Authority (NFA) and will remove its intervention in palay trading and marketing and lift the Quantitative Restriction on rice importation.

Aid for trade intends to encourage the beneficiary countries to make trade a greater priority and to encourage aid donors to scale up trade
related official development assistance.

“The government may have terminated the second and third tranches of the GDSP loan due to the farmers’ unrelenting protest. However, the loan ayment is already included in the country’s debt servicing budget,” said Jessica Reyes-Cantos of R1.

Organizations that joined the protest:

Stop the New Round! (SNR) Coalition – Philippines, Freedom from Debt Coalition (FDC), Rice Watch and Action Network (R-1), Jubilee South – Asia-Pacific Movement on Debt and Development (JS-APMDD), Bukluran ng Manggagawang Pilipino (BMP),Alliance of Progressive Labor (APL), Kilusang Mangingisda (KM), NGO Forum on the ADB, and Trade and Advocacy Group (TAG).

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