It soon becomes obvious if you read the 'Economic Report of the President 2002' that there is a coherent US strategy in place to move the world on services, including financial services, but the concept now is 'global integration of services' (see Ch. 7 of the report on 'SUPPORTING GLOBAL ECONOMIC INTEGRATION', link below).
The US will engage the IMF, WB and WTO, among other organizations in a consistent, coherent, even bullying manner to get what it wants, but if it overburdens the WTO, it has 'bilateral' strategies in place to get what it wants.
And you have to think the US wants this move awfully bad, since the stock markets in the US have een pretty much running in place for two years. As you read this stuff (I recommend going to the links and reading the entire contents if you have time), note how this move toward making the agenda 'integrated services' is explicitly linked to the developing countries (and O'Neill's recent language echoes this, though he said similar things last June as well).
--------------------------- Pt. I '3 Key Outcomes of Doha Ministerial' ---------------------------
http://www.focusweb.org/publications/2001/learning-from-doha.html (full article well worth reading btw)
Learning from Doha By Walden Bello
(Composite article based on the author's two presentations at the meeting of the "Our World is not for Sale Coalition," Brussels, Belgium, Dec. 7-9, 2001.)
Three Key Outcomes
Three outcomes of Doha must be emphasized:
- Doha put the World Trade Organization (WTO) back on its feet after the disaster in Seattle. C. Fred Bergsten, a prominent partisan of the WTO, once said that the WTO is like a bicycle: it collapses if it does not move forward. By agreeing on a declaration giving momentum to new negotiations for liberalization, the Doha meeting got the bicycle upright and moving again. Mike Moore, the director general, was not exaggerating when he thanked the ministerial for "saving the WTO."
- What resulted from Doha may not be a new round in the sense of immediate negotiations on a wide range of issues, but it was a major step toward further liberalization. First of all, the Doha declaration affirmed ongoing negotiations on certain existing agreements, such as agriculture and GATS (General Agreement on Trade in Services) and opened negotiations to review other existing agreements, like the anti-dumping agreement. Second, it launched negotiations for new agreements, for instance, on industrial tariffs. Third, and perhaps most ominous, by putting them as the centerpiece of the declaration, Doha gave momentum to the eventual launching of negotiations to bring new, non-trade areas within WTO jurisdiction. These are the so-called "new" or "Singapore issues" of investment, competition policy, government procurement, and trade facilitation.
- Doha was a clear setback for the developing countries, most of whom had wanted to focus the ministerial and its aftermath on resolving outstanding issues of implementation from the Uruguay Round, of which there are at least 104 according to the Group of 77. The declaration simply acknowledged these concerns and outlined a vague process for their resolution. Indeed, even in key areas of implementation specified in the text, such as agriculture and textiles and garments, the developing countries came out as losers. The European Union managed to water down the Cairns Group's demand that there be a quick phase-out of agricultural export subsidies, and the US and other developed countries did not commit to an early removal of quotas on textile and garment imports of critical importance to the developing countries.
------------------------------------------------- Pt. II 'US goals in language of WTO' ------------------------------------------------
http://www.wto.org/english/thewto_e/minist_e/min01_e/mindecl_e.htm#services
Services
15. The negotiations on trade in services shall be conducted with a view to promoting the economic growth of all trading partners and the development of developing and least-developed countries. We recognize the work already undertaken in the negotiations, initiated in January 2000 under Article XIX of the General Agreement on Trade in Services, and the large number of proposals submitted by members on a wide range of sectors and several horizontal issues, as well as on movement of natural persons. We reaffirm the Guidelines and Procedures for the Negotiations adopted by the Council for Trade in Services on 28 March 2001 as the basis for continuing the negotiations, with a view to achieving the objectives of the General Agreement on Trade in Services, as stipulated in the Preamble, Article IV and Article XIX of that Agreement. Participants shall submit initial requests for specific commitments by 30 June 2002 and initial offers by 31 March 2003.
Relationship between trade and investment back to top
20. Recognizing the case for a multilateral framework to secure transparent, stable and predictable conditions for long-term cross-border investment, particularly foreign direct investment, that will contribute to the expansion of trade, and the need for enhanced technical assistance and capacity-building in this area as referred to in paragraph 21, we agree that negotiations will take place after the Fifth Session of the Ministerial Conference on the basis of a decision to be taken, by explicit consensus, at that session on modalities of negotiations.
------------------------------------------ III. 'Nothing Less than US Domination of Global Integrated, Networked Services' -----------------------------------------
http://www.itworld.com/Tech/2418/IDG011102WTO/
Approaching the meeting, the U.S. is among nations that is pushing electronic commerce to be a major part of any new trade round. U.S. Trade Representative Robert B. Zoellick told the Council on Foreign Relations in Washington, D.C., on Tuesday that e-commerce, along with manufacturing, services and agriculture, will be a priority for the U.S., according to his prepared remarks.
"The WTO rules also need to be updated to tap the potential of high-tech innovations and e-commerce," he said. "Transactions over networks are providing enormous growth opportunities for any service that can reach customers electronically -- be it retailing, financial, information, or entertainment services. The opportunity for developing countries is vast -- providing them with new, more efficient means to reach global markets for products and services in which they have a competitive advantage."
------------------------------------------ Global Integration in the Master Plan -----------------------------------------
Notice here how the US's goal of global integration of services--that is, liberalization to suit the US--is explicitly linked with 'solving the problems' of the developing world.
http://w3.access.gpo.gov/usbudget/fy2003/pdf/2002_erp.pdf
CHAPTER 7. SUPPORTING GLOBAL ECONOMIC INTEGRATION ....... 251
Economic Report of the President - - - - - - - - - - - - H. Doc. 107-158 [From the online service of the U.S. Government Printing Office] [wais.access.gpo.gov]
CHAPTER 7
Supporting Global Economic Integration
Following extract taken from above.
Advancing International Financial System Reform The need for continued reform of the international financial system has generated a rich debate. Clearly, the benefits of global economic integration must be made available to all the world's citizens, and the support of the official sector is key to ensuring the smooth operation of the global trading and financial systems that underpin continued integration. At the same time, it must be recognized that official sector resources are finite and do not come out of thin air. Resources may be provided in the form of loans to developing economies, but these resources still come from public funds. As such, they are obtained from taxpayers across the globe and have an opportunity cost in terms of other governmental priorities. Both of these considerations argue for a careful assessment of costs and benefits when designing and using the international financial system.
With these ideas in mind, a set of principles for the IFIs can be identified. First, all of the above arguments and examples point to the need to differentiate between those countries that are temporarily illiquid and those that are insolvent. Although this distinction can be difficult in practice, it is crucial for good stewardship of official sector resources. Shortening the maturity of official loans may help make this distinction. Some observers have claimed that short maturities for official loans are too constraining, arguing that it is hard to help an economy by extending a loan that must be repaid in 12 to 18 months. However, if it is clear that such a loan is unlikely to be repaid, then it is more likely that the economy is insolvent rather than just illiquid. An illiquid economy should be able to regain access to capital markets in this period of time; an insolvent economy will not be able to. Insolvent economies require more drastic treatment, such as a restructuring of debt obligations coupled with limited and longer term official sector lending once the restructuring is well under way.
Official funding can also be leveraged with private sector involvement. Future design changes to the international financial system must continue to focus on incentive mechanisms that encourage involvement of the private sector. Financing that is dedicated to encouraging a voluntary restructuring is one example of such a mechanism. Such financing can serve as a catalyst in returning a troubled economy to a sustainable footing.
In the first half of the 1990s, a set of International Development Goals were developed from agreements and resolutions adopted at world conferences hosted by the United Nations. The goals found a new expression in the Millennium Declaration of the United Nations in September 2000. Most of the world's poorest countries, particularly those in Sub-Saharan Africa, are falling well behind in achieving these International Development Goals in basic education, health, and poverty reduction. The President has called for a bolder move away from loans toward grants for the poorest countries. This approach, coupled with the progress under the HIPC initiative, holds the promise of higher living standards for the least fortunate, as it would facilitate productivity-enhancing investments without adding to their debt burden. In addition, grants to the poorest economies should be targeted toward those basic needs, such as education and health, that are vital to a growing and vibrant economy. In particular, grants can lead toward a redirection of resources to combating scourges such as HIV/AIDS that tear at the very fabric of society.
Consistent with the Administration's efforts to shift the MDBs' emphasis toward grants for low-income countries is its continued efforts to make these institutions more efficient and more focused on productivity growth in developing countries as a core objective. Careful selection of programs and a greater attention to results are the two key principles underpinning the U.S. MDB reform exercise. This means that the MDBs must do a much better job in sharpening the focus of their activities, concentrating on basic development work and working collaboratively among themselves and with other donors to ensure a development framework that is consistent and efficient. The United States has also accorded particular importance to a comprehensive review of the pricing of MDB loans, to explore the possibility of greater differentiation of lending terms. Price differentiation is crucial to achieve greater lending selectivity based on differences in the development impact of individual operations and in borrowers' income per capita and creditworthiness, with preferential treatment for priority core social investments.
Finally, tying official support to efforts at creating trade can dramatically leverage any financial assistance provided to illiquid economies. As this chapter has made clear, trade is a powerful engine for economic growth and improvements in living standards. If assistance packages allow an economy both to regain access to capital flows and to invigorate trade flows, all of the developing world will share in the improvement of world living standards.
Conclusion
International flows of resources, goods, and services have played an increasingly important role in the world economy. The citizens of the United States, living in one of the most open economies in the world, have seen their well-being improve dramatically with this increased economic integration. So have the citizens of many other countries that were willing to open their borders to flows of goods, services, and capital. The gains from trade are the result of an improved allocation of resources. A more efficient global allocation of productive inputs such as capital and labor translates into an increase in global output and consumption.
To ensure that economic integration continues, constant attention must be devoted to the institutional infrastructure that supports market-based exchanges of goods, services, and capital. The past year has witnessed signs of a slowing global economy, as well as violent threats to the freedom that is essential to a well-functioning economic system. These dangers make it more important than ever to ensure continued progress toward the free flow of resources and output across national borders.
It is therefore critical that the United States remain an active leader in the continued liberalization of trade in goods and services, both on a bilateral and on a multilateral basis. At the same time, the United States must continue to encourage efforts to strengthen the international financial system that supports production-enhancing cross-border flows of capital. Strong U.S. leadership on both these fronts will help safeguard and enhance both our own economic prospects and those of the rest of the world.
--------------------------------- Compiled, commented on and posted by Charles Jannuzi