No to WTO, No to New Round, Turn Around!

Lee Changgeun

<Korean People's Action Against Investment Treaties and the WTO New Round>

A>The government must retract its position supporting the 'market principles,' 'logic of competition,' and 'logic of economics' and accept as its central focus the democracy of Korean society and the furthering of the Korean people's basic rights in the course of preparing for the New Round.

We must remember the government's promise after giving away the agricultural products market at the Uruguay Round. Promises that the industry would improve and that the benefits would be returned to the citizens of Korea, and that this would benefit the entire nation in the long run turned out to be false as time proved that the only ones to benefit from the negotiations were the chae-bol. The livelihood of countless farmers were destroyed and the redistribution of benefits have not occurred. The current government, much like before, is promising that the country is on the right path toward recovery from the IMF crisis, and that we must continue to push forward with IMF's reform program. The government's position on the New Round is along the same lines. However, the government must face up to the reality of the results that the IMF's reform program has brought to the people of Korea. It has brought on the boom of speculative investment in the stock market, countless workers have been put out to the streets, and public services have been reduced in the name of privatization. The government must admit that the quality of life for the people of Korea have gone down. The government has forced market principles in the sectors of public health and education, announcing that it would do away with small schools in the rural areas and that public health centers would be subject to structural adjustment programs. This is a violation of the right to health and the right to an education which is guaranteed in the Korean Constitution. If the government continues to uphold its 'principles of the market' in preparing for the New Round, it can only bring the serious violation of the principles of democracy and the destruction of the people's basic rights that we have fought for so long.

B> The government must withdraw from its position of supporting 'more liberalization' in the form of negotiations of the New Round, with new fields such as investment, competition, and government procurement transparency, within the WTO system.

The government currently supports the comprehensive free trade negotiations form of the New Round. It has even stepped up as the missionary for the start of the comprehensive free trade negotiations, already having turned in it's opinions on the new fields scheduled to be negotiated within the WTO negotiations. "It is time to free ourselves from the stereo-type of trade negotiations equalling the opening up of our markets. It is important to support our corporations entrance into foreign markets by actively eliminating trade blocks and standardizing multi-lateral investment agreements, thereby increasing stability and market predictability."(Lee Si-Hyoung, Ministry of Foreign Affairs) However, what the governments is hiding is the fact that this position only serves the economic interests of international corporations, without any consideration for the livelihood and the quality of life of the people, or social development. As we have stated earlier, many developing countries have stated concerns about the fact that the Uruguay Rounds have not brought them the benefits they were promised. They are opposed to the new fields being brought into the WTO negotiations at the New Round, and have pushed for talks in which existing treaties are reviewed and reformed. We believe that these problems of 'unequal treaties and unequal redistribution of wealth' are not just the problems of developing countries. The liberalization of Korean markets in previous treaties have only contributed to the accumulation of capital for the chae-bol, and have led to the steady decrease in the conditions of the lives of workers and farmers, the environment, social benefits, and basic democratic rights. The fact that special laws designed to save farmers, the biggest casualties of the Uruguay Round, have yet to take effect is symbolic of this fact.

C> We demand the delay of the inauguration of the New Round, and we also demand a total reevaluation and reexamination of the existing WTO treaties with the full participation of 'citizens, social movement organizations and trade unions', especially its effects on democracy, the environment, public health care, human rights, labor rights, women's rights, and the development of developing countries.

We remember the inauguration of the WTO 5 years back, with its fancy slogans of 'international redistribution of wealth' and 'international expansion of the opportunity for employment.' After 5 years, however, the results have been the exact opposite. Wealth was concentrated to the TNCs, and poverty expanded. Jobs became harder to find also. The TNCs have remarkably increased production by 26% while decreasing the number of employees by 4% abroad during the years 93-96. Korea hasn't been an exception. Among many examples, Mando Machinery layed off 1000 of it's workers after being sold to foreign companies. We confirm that the 'free trade and investment system' of the WTO and it's promise of increased employment is not being kept.

The fact that many of the developing countries have already expressed the inequalities in previous WTO treaties, and countless national and international social movement organizations have demanded the indefinite delay of the New Round in itself is proof of the many problems of the WTO system. Therefore, we are against any action that increases the jurisdiction and authority of the WTO, and demand the delay of any negotiation which seeks to do so. Instead, we demand the total reevaluation and reexamination of the latent effects of inequality in the system with the full participation of citizens, social movement organizations, and trade unions.

D> We point out that the government's position on the issue of liberalization of foreign investment and the protection of foreign investments (in other words the 'multi-lateral agreement on investment) solely stands for the interests of national and international corporations and has no consideration for the livelihood and rights of the majority of the people of Korea. It stands on the wrong premise that 'the introduction of foreign capital is the only to economic growth.'

According to the government's proposal on the 'trade and investment issue' the government's position is as follows; *This negotiation's purpose must be to conclude the multilateral agreement on investment within the WTO system, * With the exception of short-term capital investment, the negotiations must focus on foreign direct investment * Solution of conflicts must be in accordance with the WTO's process. We realize that this proposal suggests in its content a much lower degree of liberalization than the MAI talks at the OECD negotiations. However, in reality, not only is it very difficult to discern between foreign direct investment and short-term speculative capital, but we must question wether 'investment' by foreign investors is truly beneficial to us. After the IMF crisis, foreign investors now make up more than 20% of the national stock market, and it is tough to believe that they are in it for the long run. The fact that analysis by the stock exchange shows a decrease in the average holding period for foreign investors (from 22.3 months in 96 to 9.3 months in 99) supports this statement. The stock exchange analysis also states that in August transactions occurred at 3,4 day intervals. Foreign investors have sold over 2 billion dollars worth of stocks this year. This analysis shows that the Korean stock market is currently a 'casino' to foreign investors. Secondly, Korea is in the process of talks with the U.S. for a bilateral investment treaty, and because of this, even though the degree of liberalization within the WTO negotiations may be lower, Korea must protect foreign investors as the bilateral U.S.-Korea investment treaty standards. Currently, the U.S.-Korea BIT states that investment includes short-term speculative capital, and that investors have the right to sue countries. Therefore, it is our belief that the WTO negotiations and the BITs would both result in the furthering of the rights of foreign investors, and thereby seriously infringe upon the basic democratic rights of the people of Korea. We demand a stop to the preparations for the New Round.