Reference:

April 30 edition of the Telegraph-Journal (New Brunswick, Canada)

Janice Harvey (e-mail address at the bottom)


M.A.I. is M.I.A.

by Janice Harvey

Looking for an issue to raise when federal candidates come knocking during this election campaign? Try the MAI, or Multilateral Agreement on Investment on for size. Never heard of it? Join the club. Most Canadians are in the dark on this one. Yet it has the potential to fundamentally alter your relationship with your federal representative for several government terms into the future, possibly longer. Despite its signficance, the MAI is definitely MIA as far as the Liberal election platform is concerned.

So what is the MAI and what difference does it make to me in New Brunswick, you ask? Spearheaded by Canada, the U.S., Japan and the European Union, the Multilateral Agreement on Investment is currently being negotiated by the 29 member nations of the OECD, all industrialized countries that harbour transnational corporations (let's call them TNCs). Once finalized, it will serve as a template for the World Trade Organization (WTO) to adopt, essentially imposing its investment infrastructure on all member nations of the WTO.

The premise of the MAI is that global investors (read: TNCs) want legal protection for their money when they choose to invest it in a foreign country. Against what must it be protected? Any obligations a host country may wish to impose on that foreign investment. The MAI would prohibit any level of government from imposing job creation requirements, local hiring quotas or procurement rules, requirements to re-invest profits into research and development, or special taxation rules to capture a share of exported profits -- in short, anything that would restrict profit- making or taking -- on foreign companies investing in, say, Canada.

Also prohibited would be preferential treatment for domestic companies. Subsidies would be available equally to foreign companies; government tenders would be open to all comers; foreign ownership restrictions could not be imposed. Transnational investors would be granted the unrestricted right to buy, sell, and move businesses and other assets wherever they want, whenever they want. National, provincial and state borders would disappear among the 29 OECD countries where the movement of capital is concerned. Governments would not be allowed to entertain any economic or social development policy that might constrain foreign investment.

Furthermore, parties to the negotiations by virtue of their presence, are expected to put a freeze on any future policy changes that would impose obligations on foreign investment until the MAI is finalized. And they are committed to roll-back any existing policies so deemed within a certain time period. If any government tried to maintain or implement such a policy, transnational corporations could file a suit directly against that government before an international tribunal (an "investor-to-state" dispute rather than the conventional "state-to-state" trade dispute), with a binding outcome. Where existing international agreements are in place (such as NAFTA), "the MAI should avoid conflicting obligations and allow better treatment of the investor to prevail", according to an OECD committee working on the agreement.

The Director General of the WTO, Renato Ruggiero, described the undertaking bluntly: "We are writing the constitution of a single global economy...". As such, it guarantees unlimited rights and no obligations to global investors, removing any perogative of elected governments to influence their investments. This treaty will do nothing less than legally elevate unaccountable vehicles of private capital to the status of government.

If this sounds to you like a massive shift in power from democratically elected governments to unaccountable, obscenely rich and ever-more powerful corporations, you'd be right. But in our outrage at the audacity, not only of the TNCs behind the pact but also of Canadian bureaucrats and politicians promoting this wholesale sell-out of national and provincial sovereignty, we must also be realistic. The MAI is simply the next logical step after NAFTA. US corporations already have much of the access now being demanded by corporations in Japan, Germany, and the U.K, for example. Once tainted, how can we now stand up and claim propriety?

I'll tell you how. A majority of Canadians opposed the free trade agreements with the US and believed Jean Chretien when he promised to re-negotiate NAFTA. We have nothing to be ashamed of if we now put down our collective foot and say no to the total corporate take-over of Canada. And we wouldn't be alone.

Initial efforts to get a multilateral investment agreement (MIA) off the ground within the WTO (based on a paper submitted by Canada and Japan) failed because of opposition from non- industrialized nations on the grounds that it would impinge on national sovereignty and their ability to pursue economic development within their countries. They rightly point out that the treaty would remove their ability to channel foreign direct investment (FDI) where it is needed most within their countries. Nor would they be able to nurture their small and medium enterprises or safeguard their natural resources, the engines of job creation and economic development, and protect them from predation by large foreign companies.

According to India's Minister of State for Commerce, investment policy addresses complex matters of national importance such as regional disparities, inequalities, employment, environment and social justice. These vary from country to country, and in the same country from time to time. "We are concerned that a multilateral investment framework would take away the right of national governments to regulate and channel FDI in light of national development objectives."

Sitting here in New Brunswick, I long to hear those words from one of our own politicians. I long for a candidate who will analyze our jobs crisis in the context of governments' capitulation to the financial markets dominated by huge transnational corporations -- soon to be supra-national corporations under the proposed MAI. Keith Helmuth's essay "Double-crossed by the Invisible Hand", published in this paper last Saturday, should be required reading for all political aspirants. In it he describes the ascendency of the financial economy over the real economy. Now 50 times larger than the real economy (which produces goods and services we all need), the financial economy is where speculative transactions are made not for any social or community good but purely for the sake of generating profit for shareholders. The monopolization of money investments by the financial economy and governments' tailoring of economic and social policy to suit such investors, has starved the real economy of jobs.

The MAI takes us so much further down that road that we might never conceivably return until we are driven to a social and political revolution at a global scale. While the corporate take- over treaty is being negotiated behind closed doors and across the Atlantic, rest assured its implications will be sorely felt by people in New Brunswick. The Liberals have no intention of making the MAI an election issue. That's why it is important that you do. If you want more information, contact me by e-mail at "waweig@nbnet.nb.ca".


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