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Introduction
I would like to start by expressing my appreciation to the Research
Institute for European Affairs, Vienna University of Economics and
Business Administration and the Federal Economic Chamber of Austria for
their invitation to contribute a paper and to participate in this
Conference. For me it is a privilege to participate in this meeting and I
look forward to our discussions.
I think the idea that the regulatory framework of globalization should
have a set of universally agreed human rights regarding working conditions
or labor standards is by now widely shared, and this is, in itself, a
remarkable feature of the new realities in the global economy. However,
the question of whether, and if so, how to link labor provisions with
trade agreements has been and remains one of the most controversial.
The paper I prepared for this Conference has five main parts, and I would
also like to follow this structure and divide my intervention today in
five parts:
1) First, as background I would like to comment on some fundamental issues
about the relationship between global governance and development.
2) Second, some comments on the evolution of international regulation of
labor issues
3) Third, I am going to enumerate and briefly assess the main arguments in
favor of including labor provisions in trade agreements.
4) Fourth, I would like to review the main reasons why most developing
countries are opposed to link trade agreements with labor standards,
particularly if it involves restrictions to market access
5) And finally, I am going to look into three recent models of labor
cooperation agreements negotiated on the side of trade agreements in the
Americas. There are some lessons to be learned from them.
I. Global Governance and Development
So let me start by reminding you of some of the fundamental questions that
are being posed about globalization, and which are relevant to the
trade-labor interface, indeed that provide the background for the central
concerns of this conference:
• First, is it correct that global trade and market governance have
developed more quickly than global social governance? Is there an
imbalance between the economic and social pillars of the global governance
system?
• Second, if globalization is a strongly technology-driven process, and we
are going to have more globalization whether we like it or not, then what
are the appropriate rules and institutions for international governance?
And who defines these rules? And how participatory is the process, both in
terms of nation states and in terms of sectors or NGOs within nations?
• Third, what should be the role of the WTO in international governance
vis-à-vis other international institutions? Specifically, should the WTO
agenda be expanded to include new areas of international and domestic
regulation such as labor and the environment? Is this expansion of the
agenda in the WTO and centralization of the power to make and enforce
rules desirable? Or is decentralization and specialization in the
allocation of power for rule making in functional areas better as a global
architecture? As I will explain in a few minutes, in Doha, some of these
questions received a very specific answer that should settle some of these
issues in the next few years.
For the moment let me just say that these are all legitimate and important
questions. However, if the objective is to promote development and design
development-friendly international policies, institutions and rules then
there is some risk in taking these questions as your starting point. The
risk is associated with the fact that there is a certain bias in these
questions towards reasoning from the perspective of an industrial country
consensus about the modern market economy and its institutions. I think a
special effort must be made to have as a starting point a development
perspective. This is important because where you stand in terms of the
trade-labor nexus depends to an important degree on your views about
development and its fundamental determinants.
From a development perspective there are two debates that are particularly
relevant.
• One is the issue of the nature of the linkages between increased trade
and market access, growth and poverty. Research shows clearly that growth
matters for poverty reduction, and that trade matters for growth. Faster
growth is associated with faster poverty reduction, and economic
contraction is associated with increased poverty. For poverty to increase
with economic growth, there would have to be a drastic worsening of income
distribution, and this is not generally the case in most countries. But it
is also equally clear that growth by itself does not necessarily improve
income distribution, and that this requires a complex array of
accompanying social policies.1
The point that stands out clearly is that development requires growth and
that increased market access and expanded trade is one of the major
contributions that the world trading system can make to growth and poverty
reduction.
• The second debate is about the role of rules and institutions in
development. The international community has re-discovered that
institutions matter for development, but what kind of institutions? I
think institutionalist economists are right in arguing that the state and
the market can be combined in many different ways, that there are many
different models of the mixed economy that can promote growth. As Dani
Rodrik has noted in a recent paper on Development Strategies for the Next
Century: “There is no single mapping between a well-functioning market and
the form of non-market institutions required to sustain it. This finds
reflection in the wide variety of regulatory, stabilizing and legitimizing
institutions that we observe in today’s advanced industrial societies… We
need to maintain a healthy skepticism towards the idea that a specific
type of institution – a particular form of corporate governance, social
security system, or labor market legislation, for example- is the only
type that is compatible with a well functioning market.” (Rodrik, 2001,
p11) This point about institutional diversity is a healthy warning against
a simplistic importation of international rules and standards that might
not fit the specificities of developing countries.
Let me now turn comment for a couple of minutes on the evolution of
international and regional regulation of labor issues.
II. International and Regional
Regulation of Labor Issues
As you know, there is a long tradition of international coordination of
labor law around the ILO. The 1990s saw a growing international consensus
on a number of core labor rights that led to the 1998 ILO Declaration on
Fundamental Principles and Rights at Work that binds the 175 ILO members.
The core labor rights are:
1. freedom of association and the effective recognition of the right to
collective bargaining,
2. the elimination of all forms of forced or compulsory labor,
3. the effective abolition of child labor, and
4. the elimination of discrimination in respect of employment and
occupation.”
However, one thing is reaching a consensus based on general rights or
values, and quite another to translate core labor rights into
operationally uniform and enforceable labor standards.
In a recent paper Drusilla Brown (2001) analyzes some of the difficulties
of defining common labor standards as well as the complex relationships
between labor standards and economic efficiency. The author concludes that
“Taking steps to reduce forced labor, child labor, and discriminatory
behavior, or to support free association and collective bargaining will
often have a mixture of effects… We cannot make a general statement that
universal labor standards derived from commonly held moral values will
always produce positive economic outcomes. The effect on economic
performance and the lives of workers and their families of legally imposed
labor market constraints of the sort contemplated by labor rights
activists cannot be presumed to be positive, but instead must be
empirically investigated on a country-by-country basis.” (p 97). The point
here is that although from a rights perspective there is nearly universal
consensus on core labor rights, adopting uniform labor standards in
operative terms is controversial.
As regards labor cooperation programs in the Americas, the thirty-four
countries in the Western Hemisphere have a fairly good record of ratifying
ILO conventions (Table 2). The countries also have a tradition of
cooperation on labor issues, which has been strengthened by the Summit of
the Americas process.
Ministers of
Labor of the hemisphere meet every two years. At their meeting in Viña del
Mar, Chile, in 1998 the Ministers of Labor agreed on a Plan of Action, and
established two working groups: one on Globalization of the Economy and
its Social and Labor Dimensions; and another on Modernization of the State
and Labor Administration.
Ministers
identified priority areas and have a number of initiatives to make
progress in each area, including: the role of the Ministries of Labor,
employment and the labor market, vocational training, labor relations and
basic workers’ rights, social security, health and safety, enforcement of
national labor laws and administration of justice in the labor area, and
social dialogue.
The
Inter-American Conference of Ministers of Labor met again in Washington DC
in February 2000 and the last meeting took place last October 17-19 in
Ottawa, Canada. In this last meeting Labor Ministers established two
working groups: one to examine the labor dimensions of the Summit Process
and improve hemispheric cooperation on labor issues. The other group has
the objective of strengthening the capacity of labor ministries to enforce
labor legislation.
III. Assessment of the Case for Inclusion of
Labor Provisions in Trade Agreements
So with these comments and information as a background, let me turn to the
question of what are the arguments that have been put forward to justify
the inclusion of labor provisions in trade agreements? These arguments can
be grouped in four categories: common sense arguments; moral arguments;
economic; and institutional arguments.
Common Sense and Trade-Relatedness
The basic common sense argument for linkage says that since trade and
labor issues are intimately related, there should be no reason to oppose
linkage. Although widely used in political discourse, particularly by
trade union leaders, and perhaps appealing to the intuition, this is not a
good enough basis to make decisions in this area. For instance, trade and
income distribution issues are also related. Should there be an income
distribution clause in trade agreements? I think a common sense approach
does not take us very far. Now, departure from common sense can take two
directions. One is a pragmatic view: trade-related is anything governments
decide to define as trade-related. This realpolitik view has some merit,
and according to many it was precisely this that led to the inclusion of
IPRs in the Uruguay Round. The other direction is analytical and Keith
Maskus (2000), for instance, has developed an interesting framework to
analyze trade-relatedness.
Moral Arguments
The second category of arguments is moral. The typical moral concern says
that: “We should not do business with countries that violate labor or
human rights”. This idea poses a complex set of issues. First, I think a
distinction should be made between the rationale for sanctions against
regimes that systematically violate labor and human rights as a matter of
policy, and the rationale for using market access restrictions as a lever
or stick to deal with labor standards in the context of economic
integration among countries with shared economic and political values but
in different stages of development. These are two completely different
realities and the corresponding policies should also be different.
Second, if it is accepted that trade is good for growth and living
standards, and if the moral concern is about the well being of the
majority of the poor in developing countries, then one must conclude that
limiting trade does not help people in developing countries, it actually
punishes them. This is not an argument against including trade provisions
in trade agreements per se, but one against using a trade sanctions
approach.
A related consideration is that, in the case of child labor, for example,
less than 5% of child laborers in developing countries are employed in
export industries, 95% of the problem lies in the non-tradable sectors.
Therefore, even if morally well intended, a sanctions approach to
compliance with labor standards fails to have any effect on the
non-tradable sectors and the general conditions of underdevelopment that
are actually at the root of the child labor problem.
Economic Arguments.
The third category of concerns behind the pressures to include labor
provisions in trade agreements is economic. There are four basic sets of
economic issues:
1. The race to the bottom argument,
2. The idea that to compete with countries where low-wages prevail is
unfair competition
3. The notion that trade liberalization without harmonization of labor
standards is bad for wage dispersion and income distribution in the north,
and
4. The concern about job dislocation and displacement produced by
competing imports.
Let me briefly comment on each one of these issues.
Race to the bottom
The race to the bottom refers to the fear that in the absence of
international coordination, countries will have an incentive to lower
their own standards to be more attractive to foreign investment or to gain
a competitive advantage. Notwithstanding how appealing this argument may
look intuitively, there is simply no evidence to support it. A review of
the relevant literature suggest the following:
• As regards export performance one of the principal findings of the
well-known OECD 1996 study was that there is no evidence that countries
with low core labor standards enjoy a better global export-performance
than high-standards countries. And the 2000 update of this study states
that this finding has not been challenged by new evidence. A study by
Aggarwal (1995) concludes that comparisons across more export-oriented and
less export-oriented sectors indicate that core labor standards are often
lower in less export-oriented or non-trade sectors.
• As regards investment, studies of investment location decisions of
multinational companies show that these decisions are influenced by many
factors of which critical ones are political and macroeconomic stability,
quality of infrastructure, logistics and of labor skills, rather than low
quality of labor standards.
• In addition, the 2000 OECD study concludes that: “With the notable
exception of China, countries where core labor standards are not respected
continue to receive a very small share of global investment flows. There
is no evidence that low-standards countries provide a haven for foreign
firms.” (OECD, 2000, 13).
• As regards wage levels, the evidence is clear that wages in Export
Processing Zones tend to be higher than average wages in the rest of the
economy.
Thus, there is no conclusive evidence that export performance or FDI flows
are correlated with low labor standards of low wages. In fact, labor
standards and wages are higher in export sectors than in non-traded
sectors. Even in cases where there might be an incentive to lower
standards, democracy, accountability, strong local institutions and
international cooperation are probably the best deterrent for any country
to engage in such race.
Low wage competition is unfair competition
Let me now turn to the idea that to compete based on low-wages is unfair
competition. This argument rests on two implicit assumptions: (a) that
low-income countries have discretion to define the level of wages, and (b)
that a competitive advantage based on low wages is illegitimate and
consequently unfair. Neither of these propositions is good economics or is
supported by solid evidence.
The level of wages in an economy is determined by the relative factor
endowments, the skill profile of the labor force, the general standard of
living, technological conditions and the growth of productivity over time.
In other words, it is closely linked to the stage of development of a
country. So except on the margin, it is not a variable that the government
can establish by decree to gain a comparative advantage. Differences in
factor endowments and their relative prices have always been part of
legitimate advantages in trade. The 2001 Communication from the European
Commission on Promoting Core Labor Standards recognizes this by adopting
the position that the comparative advantage of countries, particularly
low-wage developing countries, must in no way be put into question.
(European Commission, 2001).
Impact of trade with low-wage economies on industrial economies
The third set of economic concerns is linked to the perception that
increased trade with low-wage economies, has contributed to wage
dispersion and income inequality in the North, particularly by hurting
employment and income of unskilled workers. It is a fact that since the
early 1980s the United States has experienced a fall in real wages of the
lowest skilled workers, measured either in real terms or relative to wages
of high-skilled workers; a fall in the relative employment of less-skilled
workers; and, as a result, an increase in the share of total labor income
going to high-skilled workers.
Many volumes and papers have been written on these issues. Two main
factors are widely cited as possible explanations of these changes:
international competition from low-wage countries and skill-biased
technological change that has increased the demand for skilled workers. As
a recent volume and survey of this literature by the National Bureau of
Economic Research concludes: “A large amount of research during the past
two decades has sought to evaluate both explanations, with the result that
… skill-biased technological change is often thought to be more
important”. (Feenstra, 2000, p 3).
A variation of this literature analyses not just the differences in the
level of wages but the associated question of whether wages are related to
labor standards. No robust relationship is found between labor standards
and the level of wages. A recent survey concludes that in general, the
link from low labor standards in low-income countries to the wage of
unskilled workers in industrialized countries is not strong. (Drusilla
Brown, 2001, p 99).
In conclusion, the notion that trade liberalization without harmonization
of labor standards is bad for wage dispersion and income distribution in
the North, is not well supported by the available evidence.
Job dislocation and displacement
Finally, as regards the job dislocation effect, it is clear that trade and
the shifting pattern of comparative advantage can indeed produce job
displacement and dislocation. In fact, from a Schumpeterian perspective
this is essential for the process of “creative destruction” that drives a
healthy process of economic transformation and provides vitality to
capitalist economies. The right response to this effect is not to resist
these changes with protectionist responses but rather to facilitate
adjustment via trade adjustment assistance policies, including income
support, retraining programs, workers relocation and other safety nets
mechanisms. Of course, there is a complex political economy dynamics
behind any such process and countries must be able to afford these
programs. In addition, it must be recognized that the WTO and trade
agreements have mechanisms such as transition periods, safeguards against
import surges, anti-dumping, and others that can be used to help workers
and industries to adapt to the new competitive environment.
Institutional Arguments and Issues
Let me now turn to the institutional argument for including labor
provisions in trade agreements and in the WTO. This is eminently
pragmatic. It is the idea that the ILO has no “teeth”, that is, no
enforcement power, while the WTO and trade agreements do. Several
questions emerge here: Is the enforcement capacity of the ILO really as
weak as sometimes portrayed, and if so, can it be improved? Can the WTO
really be a better enforcer than the ILO? Which institution could be more
effective in local-capacity building in this area?
On the first question, the view of the Commission of the European
Communities for example, is that “The ILO has in recent years enhanced
very substantially its means for promoting respect for core labour
standards” (Commission, 2001, p 13). There has been an important
clarification in the position of the Commission over the past two years.
While in Seattle the Commission seemed to be interested in involving the
WTO in Labor issues, the 2001 European Community proposal for promoting
labor standards is based on strengthening the ILO’s role.
The EU proposal (Commission, 2001) is quite different from some of the
mainstream positions in the U.S. debate on these issues. The proposal has
a number of basic tenets:
• rejection of any sanctions-based approaches;
• the principle “that the comparative advantage of countries, particularly
low-wage developing countries, must in no way be put into question”;
• the idea that “poverty, poor governance and extensive informal sectors
are often the main cause of the weak implementation of core labour
standards in developing countries”;
• and the notion that “sustained economic growth can contribute to the
respect and effective application of labour standards and of the social
regulatory framework and vice versa”.
Based on these premises the EU initiative proposes an approach to promote
core labor standards and improve social governance that “comprises
instruments and actions within different policy fields”. A central pillar
of this integrated strategy is making the ILO a more effective enforcer by
giving more weight to observations in reports; giving greater publicity to
the supervisory mechanism; improving the effectiveness of complaint
procedures; and consideration of positive incentives.
But there are also other elements in the proposal: increased multilateral
technical assistance, including the ILO; launching a forum for
international dialogue; increasing trade incentives through the
generalized system of preferences; addressing the issue in bilateral
relations through assistance and capacity strengthening; supporting
private and voluntary schemes for the promotion of core labor standards
through social labeling and industry codes of conduct.
IV. Why are Most Latin American Countries
Opposed to a Sanctions-Based Approach?
Now, why are most LAC countries opposed to include labor provisions in the
WTO and in regional trade agreements, particularly under any approach
involving trade restrictions or sanctions?
To be brief,
let me just enumerate the six types of reasons I identify for this
opposition:
1. The fear
that such inclusion will distract attention and energies away from the
main market access negotiating priorities of developing countries.
2. The
perception that beyond the morality-driven human rights groups, the
pressures to include labor provisions emanate from politically powerful
lobbying groups, concerned about competitiveness, and interested in
defending protection and privileges.
3. Various
issues related to stage of development differences, particularly the
problems with the strict application of uniform labor standards in very
different labor market conditions.
4. Questions
concerning the logic of trade negotiations, in particular, the fact that
given the enormous asymmetries in market size and relative importance as
trading partners, only countries with large markets could threaten with
credibility and actually produce damage, in many cases disproportionate
damage, by closing their markets to others. Thus accepting a link to
market access is seen as a way of institutionalising unilateralism in a
multilateral context. No win-win outcome is perceived in this.
5. The fifth
source of opposition is related to the questions: Are trade sanctions the
best way to achieve results in improving labor standards or other social
conditions? Are there superior ways? Many see institutional deficiencies
as the main obstacle and therefore consider cooperation through technical
assistance and capacity building as first-best instruments to achieve
results. Institutional deficiencies have been in fact one of the major
difficulties for developing countries to implement some aspects of trade
agreements, particularly in resource-intensive areas, which suggests that
it is not enough to write a trade provision to ensure compliance. As the
World Bank Global Economic Prospects Report 2002 points out, trade
agreement implementation requires to step up very substantially global
cooperation outside of the WTO and outside of trade agreements.
6. Finally,
there are arguments related to the architecture of the global trading
system that many developing countries share but are part of a much wider
debate. Trade negotiators and many experts are concerned about overloading
the WTO, in particular, the dispute settlement body with disputes that are
rather about labor or environmental issues than about trade. Many believe
that the WTO has neither the expertise nor the legitimacy to adjudicate
these disputes and that asking it to arbitrate in such matters undermines
its credibility and diverts attention from its first priority, opening-up
markets and enforcing free trade rules. I am personally quite attracted to
the idea of having a more decentralized system in the allocation of global
regulatory responsibilities, where each agenda is pursued by a separate
responsible agency, with appropriate coordination between them.
But the point
is that for all these reasons the developing countries have been resisting
the inclusion of labor provisions in the WTO and in trade agreements
generally, particularly under any approach involving trade restrictions.
The outcome of Doha represents a success for the developing countries on
this issue and a disappointment for certain groups in the US and the EU.
In Doha the
labor and environmental issues took different roads: while there is now a
strengthened mandate to negotiate certain environmental issues,2
on labor issues in Doha Ministers reaffirmed the Singapore position that
the ILO is the competent body to set and deal with labor standards and
limited themselves to “take note of work under way in the ILO on the
social dimension of globalization” (Doha Declaration, paragraph 8). So it
is to be expected that at least for the next few years, and specifically
for this round of multilateral trade negotiations, the Doha Declaration
put to rest the contentious aspects of the trade-labor nexus issue as a
major divider between the developed and developing worlds in multilateral
negotiations.
V. Regional Innovation on Trade and Labor
Issues
Given this outcome in Doha, and building on existing trends, however, it
is probable that the labor issue will be retaken at the regional level,
particularly at least in the Americas.
Despite general opposition to linking, some countries in Latin America
have agreed to include labor provisions in the regulatory framework of
reciprocal trade agreements. Three models of labor cooperation agreements
have emerged in the Americas, all of them in the form of side agreements
to three trade agreements: the NAFTA (1994), the Canada-Chile Agreement
(1996) and the Canada-Costa Rica Agreement (2001). The first two
agreements share many characteristics and procedures; the last one is more
unique, simpler and broader at the same time.
The last section of the paper compares these three labor cooperation
agreements (LCA) in terms of their objectives; scope; cooperation
activities; institutional mechanisms; procedures for consultation,
evaluation and dispute resolution; and implementation and enforcement.
Let me mention just a few key points:
1. The objective of all three agreements is the promotion of compliance
with and effective enforcement by each Party of its own labor law, they do
not establish minimum or common standards for domestic law.
3
2. Scope of application is one of the most important differences between
these agreements. The three agreements cover a broad list of labor rights
listed in an Annex to each agreement. However, only the political
consultations and evaluation process covers this complete list, the
independent review panel or “arbitral panel” process for dispute
resolution is much more narrow in scope in the North American Agreement on
Labor Cooperation (NAALC) and the Canada-Chile LCA. The NAALC and the
Canada-Chile agreement limit the scope of the arbitral panel to the
Party’s technical labor standards on occupational safety and health, child
labor or minimum wage. In contrast, the “review panel” process of the
Canada-Costa Rica LCA has competence to review issues pertaining to all
the rights recognized in the ILO Declaration on Fundamental Principles and
Rights at Work, 1998, which means that it has competence over a much
broader set of issues. In an interview with a high official in the
Canadian Ministry of Labor I was told this was one of the main features
Canadian Trade Unions had found most attractive in exchange for the
NAFTA-minus nature of the Canada-Costa Rica LCA, in that it has no
trade-sanctions.
3. The three agreements commit the parties to wide ranging cooperation in
specific labor areas and instruct direct coordination between the labor
authorities in each party.
4. Another difference is that the NAALC as well as the Canada-Chile
Agreement LCA have a long and complex procedure for consultations,
evaluations, and resolution of disputes. (Box 1). The Canada-Costa Rica
LCA simplifies these procedures. (Box 2).
5. An interesting innovation in the Canada-Costa Rica LCA is that the
Panel is asked to “take into account (in its recommendations) the existing
differences in the level of development and size of the economies of the
Parties”. No such provision is found in the other two agreements.
6. Enforcement is the other major difference between agreements. In the
NAALC and the Canada-Chile LCA, the panel may impose a monetary
enforcement assessment or fine, no greater than 20 million US dollars in
the NAALC and US $ 10 million in the Canada-Chile LCA. In the NAALC where
a Party fails to pay the fine, the other Party “may suspend NAFTA benefits
in an amount no greater than that sufficient to collect the monetary
enforcement assessment”. In the Canada-Chile LCA, in contrast, no
suspension of trade benefits –trade sanctions-- is contemplated. Instead
jurisdictional procedures ensure the payment of fines. The Canada-Costa
Rica LCA has neither monetary enforcement –fines– nor suspension of trade
benefits. It is only established that the party “may take reasonable and
appropriate measures, exclusive of fines or any measure affecting trade,
but including the modification of cooperative activities (art. 12), to
encourage the other Party to remedy that persistent pattern, in keeping
with the panel’s determinations and recommendations” (Art. 23, 5)
That is, the Canada-Costa Rica agreement introduces a new approach based
exclusively on cooperation and technical assistance to promote compliance
and effective enforcement of national labor law.
I do not think that these innovations in RTAs in the Americas are
necessarily relevant in the multilateral context, particularly in light of
the outcome of Doha on labor issues. However, they have been very
influential in the debates on Trade Promotion Authority in the US Congress
and in the negotiations to create a Free Trade Area of the Americas.
Let me conclude by stressing the broad global consensus that exists around
the view that the regulatory framework of globalization should have a set
of universally agreed human rights regarding labor conditions. At the
global level, the post-Doha agenda settled this issue in favor of
allocating global regulatory responsibilities in the ILO. However, as I
suggested, how this issue will play out in regional governance,
institutions and trade agreements is still an open question.
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NOTES:
(*)
Director, Trade Section, Organization of American States (jsalazar@oas.org).
The views expressed are those of the author and should not be attributed
to the Organization of American States or to its member states. This
Lecture draws from the paper “Trade, Labor and Global Governance: A
Perspective from the Americas”, written jointly with Jorge Mario Martínez.
[1] Two bodies of empirical
literature support the general case for the beneficial growth effects
trade and economic openness. One is the recent research that provides
evidence about the positive relationship between trade and growth. The
other is the literature analyzing various integration and trade
liberalization scenarios in Latin America using multi-country Computable
General Equilibrium (CGE) models. On the former see Levine and Renault
(1992), Sachs and Warner (1995), Sala-i-Martin (1997), Frankel and Romer
(1999), Irwin and Tervio (2000), Dollar and Kraay (2000). Rodriguez and
Rodrik (2000) and Rodrik (2001) are skeptical about the robustness of some
of these results regarding the relationship between trade openness and
growth. Jones (2000), however, focusing on trade policy variables,
concludes that trade restrictions are almost invariably harmful to
long-run growth, although the magnitude of the effect is uncertain. For
Rodrik “The appropriate conclusion to draw … is not that trade protection
should be preferred to trade liberalization as a rule. The point is simply
that the benefits of trade openness should not be oversold” (Rodrik, 2001,
p 39).
[2] The Doha Declaration contains a
mandate to negotiate three specific issues: (1) the relationship between
WTO rules and trade obligations set out in multilateral environmental
agreements (MEAs); (2) procedures for information exchange between MEA
Secretariats and relevant WTO committees, and the criteria for the
granting of observer status; and (3) the reduction or elimination of
tariff and non-tariff barriers to environmental goods and services. There
is also mandated discussion in the Committee on Trade and Environment on:
(1) clarifying WTO rules in relation to the effects of environmental
measures on market access; environmental provisions under the TRIPS
agreement such as the patenting of life forms and the relationship of
TRIPS with the U.N. Convention on Biodiversity; and eco-labelling.
[3] The three agreements have an
annex where the following labor principles are listed: (1) Freedom of
association and protection of the right to organize; (2) The right to
bargain collectively; (3) The right to strike; (4) Prohibition of forced
labor; (5) Labor protections for children and young persons; (6) Minimum
employment standards; (7) Elimination of employment discrimination; (8)
Equal pay for women and men; (9) Prevention of occupational injuries and
illnesses; (10) Compensation in cases of occupational injuries and
illnesses; (11) Protection of migrant workers.
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