What free trade?

By Bukka Rennie
November 26, 2003

How many of us can recall that when we first entered the world market as exporters of steel, the United States of America posed serious objections? They objected to our presence as steel exporters on the grounds that ISCOTT (the Iron and Steel Company of Trinidad & Tobago) was State-owned and therefore, heavily subsidised, and that we were dumping steel unfairly on the US market.

The Steel producers of the USA kicked heavily against the very miniscule penetration of the US market by ISCOTT. They kept insisting that T&T should not produce "steel" but instead should forestall the process at the stage of "sponge iron" and the USA will buy all the "sponge iron" that T&T could ever produce.

Dr Eric Williams went ballistic. ISCOTT and the production of steel represented to him a major breakaway from the traditional, exploitative "international division of labour" that existed from time immemorial, between the metropolitan epicenters and the undeveloped peripheral areas of the non-white so-called Third World.

According to this international division of labour, we were supposed to remain forever "hewers of wood and drawers of water", producers of primary products, cheap minerals and raw materials, while they, the metropolitan epicenters, enjoyed the value added from refining and processing, the surplus results of which became extremely high-priced items to be consumed willy-nilly by countries such as us.

Eric Williams and the technical people around him, wished to break this vicious cycle of impoverishment and undevelopment and launch this country onto a new path and a new direction.

We possessed natural gas in huge commercial quantities to power a modern steel plant with the help of Japanese technology, while the US plants were still in the process of re-tooling and moving away from coal as energy, and so they felt more than ever the necessity to protect their own.

"What do they want us to do?" Eric Williams responded angrily, "sit down here in Trinidad and Tobago and pitch marbles!"

Once he took that position it meant that everything would be done to keep "steel" from Trinidad & Tobago out of the US market. We had to turn to the poor regions of Europe such as Spain to sell our steel.

ISCOTT could not survive in this manner since the US represented our biggest and closest market. Privitisation, therefore, became an urgent priority and necessity. ISCOTT became ISPAT.

Today, so many years after, Trinidad and Tobago stands fully vindicated. In March 2002, the Bush government imposed yet again a 30 per cent tariff on imported steel and the countries of the European Union appealed to the World Trade Organisation that arbitrates on the rules and regulations of global free trade. The EU also threatened in retaliation to impose a 100 per cent duty on some US import, and the WTO, mindful of possible implosion, has since ruled the US 30 per cent tariff on steel as illegal and has legislated that the tariff be removed immediately.

Yet the big bully, always the one to insist that all other countries desist from all forms of protectionism, is refusing to budge.

Scott McClellan, spokesman for the Bush Regime had this to say: "...the steel safeguards the President imposed were to provide our domestic steel industry an opportunity to adjust to import competition... to give our domestic industry an opportunity to restructure and consolidate and become stronger and more competitive..."

Imagine that! When we hold the same view in a desire to protect new industries in their infancy, industries fighting for the very first time to see the light of day, not industries which have already made huge profits worldwide and are merely re-tooling or restructuring, we are condemned by the USA.

The scenarios are as different as chalk and cheese. The rest of the world must stand up to these contradictions. And if we feel the situation with steel is bad, the farm trade is ten thousand times worse.

Food is the biggest weapon in the war that is global trade. Both the US and the European Union are guilty of subsidizing their farmers to the tune of some US$300 billion annually, as some analysts indicate, which in fact, is more that the combined annual aid from the Metropolitan epicenters to the entire developing world in which starvation and malnutrition reap havoc.

Our major task today as a nation and as a region, is to break out of that stranglehold. By now after all the years, we must have learnt something from the sugar and banana experience. Going before the whole wide world, cap in hand, begging for preferential treatment and guaranteed market is no longer a plausible option, that was a relic of colonial relations.

That is not a hallmark of today's trading relations. The poor and the marginalised must rally across the regions of the world to break the power of the Metropolitan epicenters. Already the Latin-American farmers are calling for such a unity. They are saying that the "free-trade" policies of the US must be fought to the finish and in this regard, the US must be made to face a loss, trade-wise, as effective as the military loss in Vietnam.

The battle is taking shape aggressively to decide by January 2005, the parameters for the Free Trade Area of the Americas that involves some 34 countries, an entire population of some 800 million from Alaska to Chile and Argentina, and that is estimated to have a turnover of goods and services to the tune of some US$11 trillion. How are we in Caricom, just 1.8 per cent of that 800 million, to fare come 2005? Caricom has to pull together tightly if we are to manage what lies ahead in our own interest. We seem to lack the will to nurture political mobilization.

Why do our governments, bar none, fear rallying the mass movement to deal with the issues of the Caricom Single Market Economy and the parameters of the FTAA?

If we rallied the people in the 60s to deal with the question of political Independence, then why can the people not be rallied today to deal with the question of genuine free and mutually beneficial trade, the right to sovereignty and the right to socio-economic development in the interest of all to the very last person. Why?

The history tells us that once political mobilisations take center stage, wanton crime, ill-discipline and slothfulness suddenly disappear. Where is the courage and the vision?