Globalisation – Fair For All? Archive Article.
December 8, 2008

RADIO 2CBA FOCAL POINT COMMENTARY BROADCAST ON FRIDAY OCTOBER 29 1999 ON RADIO 2CBA FM.

World trade is growing faster than national economies. In other words, countries are doing more trade with each other as the years go by – and are doing so at a faster rate than their own national economic growth. But is everyone benefiting from all this trade?

The current world trade system goes back to the end of World War II. If generals always prepare to fight the last war, so diplomats always prepare to avoid having to fight the last war. In 1945, the diplomats wanted to learn from the economic lessons of the 1930s, which gave rise to Hitler. They wanted to avoid another depression.

Economic reform was therefore a major objective for the United Nations created in 1945. Western governments such as Australia said that more should be done to encourage of free trade. The argument was that protectionism and the high tariff barriers in the 1930s made the depression worse.

Therefore, international organizations like the General Agreement on Tariffs and Trade and the World Trade Organization have been created to encourage the lowering of tariff walls and the end of protectionism.

All the major Australian political parties have been great supporters of the free trade process over the years. This has seen the loss of many jobs in many inefficient Australian factories but also the growth of efficient Australian factories and the influx of cheaper goods which have been a benefit to Australian consumers.

Looking to the big picture, an impact of the globalized trading order is the potential conflict between trading policy and human rights policy.

Workers’ rights in developed countries such as Australia are being jeopardized in the interests of making money. Thus, workers in many Third World countries are working in very unsatisfactory conditions. For example, China runs camps for political prisoners operating as factories for goods sold to developed countries, such as Australia.

One response is to restrict the importation of products from such countries until they lift their human rights standards.

But such a response may become illegal under the World Trade Organization treaty because these measures could be seen as “non-tariff barriers to trade”.

For example, China may try to claim that any “human rights” restrictions are simply a way of keeping out goods that would undercut the prices in developed countries.

But there is a great risk that the free trade negotiations will result in a levelling down – rather than a levelling up – of human rights standards.

This is a matter that needs to be watched. Free trade is fine objective but it should not come at the expense of Australian workers. Ideally, we should only have free trade with countries that permit free trade unions.