The Language of World Trade Politics: Unpacking the Terms of Trade [1 ed.] 1138479837, 9781138479838

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The Language of World Trade Politics

Outcomes in major multilateral trade negotiations are conventionally explained as resulting from interests weighted by (trading) power. Offering a different overview of the concepts we use to talk about the international trade regime, this edited collection puts the ideational foundation of world trade politics centre stage, and critically examines the terms in which we make sense of world trade politics. The concepts used to make sense of world trade politics are often employed strategically, making some aspects of reality visible and others invisible. Reflecting upon ten key concepts from ‘trade’ itself to ‘protectionism’ and ‘justice’, this book poses two broad questions: first, how and by whom have the meanings of different terms used to describe, challenge and defend world trade politics been constructed? Second, how have the individual terms changed over time, and with what consequences? The editors and contributors draw on a broad range of theoretical approaches, from post-­structuralism or cognitivism to normative theory, shedding new light on why certain trade issues and agendas win out over others, who benefits from the current system of trade governance, and what contemporary challenges the World Trade Organization faces. In doing so, the book speaks to a growing and diverse constructivist literature in International Political Economy. This book will be of interest to scholars, students and policy professionals working within International Relations, International Political Economy and economics. Klaus Dingwerth is Professor in Political Science with a Focus on the Political Theory of the Globalized and Digital Society at the University of St. Gallen, Switzerland and a Non-Resident Fellow at the Global Public Policy Institute (GPPi). Clara Weinhardt is a Lecturer in International Relations at the Hertie School of Governance and a Non-­Resident Fellow at the Global Public Policy Institute (GPPi).

RIPE Series in Global Political Economy Series Editors: James Brassett University of Warwick, UK

Eleni Tsingou

Copenhagen Business School, Denmark

and Susanne Soederberg Queen’s University, Canada

The RIPE Series published by Routledge is an essential forum for cutting-­edge scholarship in International Political Economy. The series brings together new and established scholars working in critical, cultural and constructivist political economy. Books in the RIPE Series typically combine an innovative contribution to theoretical debates with rigorous empirical analysis. The RIPE Series seeks to cultivate: • • • •

Field-­defining theoretical advances in International Political Economy Novel treatments of key issue areas, both historical and contemporary, such as global finance, trade, and production Analyses that explore the political economic dimensions of relatively neglected topics, such as the environment, gender relations, and migration Accessible work that will inspire advanced undergraduates and graduate students in International Political Economy.

The RIPE Series in Global Political Economy aims to address the needs of students and teachers. Transnational Capital and Class Fractions The Amsterdam School Perspective Reconsidered Edited by Henk Overbeek and Bob Jessop The Language of World Trade Politics Unpacking the Terms of Trade Edited by Klaus Dingwerth and Clara Weinhardt Power in North-­South Trade Negotiations Making the European Union’s Economic Partnership Agreements Peg Murray-­Evans For more information about this series, please visit: www.routledge.com/RIPESeries-in-Global-Political-Economy/book-series/RIPE

The Language of World Trade Politics Unpacking the Terms of Trade

Edited by Klaus Dingwerth and Clara Weinhardt

First published 2019 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 711 Third Avenue, New York, NY 10017 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2019 selection and editorial matter, Klaus Dingwerth and Clara Weinhardt; individual chapters, the contributors The right of Klaus Dingwerth and Clara Weinhardt to be identified as the authors of the editorial matter, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing-­in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-­in-Publication Data A catalog record has been requested for this book ISBN: 978-1-138-47983-8 (hbk) ISBN: 978-1-351-06466-8 (ebk) Typeset in Times New Roman by Wearset Ltd, Boldon, Tyne and Wear

Contents



List of illustrations Notes on contributors Acknowledgements List of abbreviations

  1 Terms of trade: introduction

vii viii xi xiii 1

K laus D in g wert h and C lara W ein h ardt

  2 Trade

22

M att h ew E a g leton - ­P ierce

  3 Protectionism

32

Gary W inslett

  4 Foreign direct investment

50

L ukas  L insi

  5 Multilateralism

64

M att h ew L ouis B is h op and V albona M u z aka

  6 Democracy

80

K laus D in g wert h

  7 Civil society

97

M ic h ael S tran g e

  8 Coherence F elix A nderl

115

vi   Contents   9 Development

132

C L A R A W E I N H A R D T A N D A n g ela Geck

10 Environment

152

E mily L yd g ate

11 Justice

176

C lara B randi



Index

193

Illustrations

Figures 8.1 Coherent with what? 8.2 Coherent with whom?

125 126

Tables   4.1 Where in Europe are the US multinationals?   8.1 Forms of coherence   9.1 Developing country categories in statements at GATT sessions of contracting parties and WTO ministerial conferences 11.1 Mapping justice-­based arguments 11.2 Discursive dynamics and meaning-­makers

57 123 144 177 181

Contributors

Felix Anderl is a Research Associate in International Relations at Goethe University Frankfurt where he focuses on the interaction of protest movements and international organizations, especially in the fields of economic governance and development.  Matthew Louis Bishop has been Senior Lecturer in International Politics at the University of Sheffield, UK since 2016. Previously, he worked at the University of the West Indies in Trinidad and Tobago, and has held visiting positions at universities in the UK (Warwick, as Transatlantic Fellow), the Netherlands (Institute of Social Studies and the Royal Netherlands Institute of Southeast Asian and Caribbean Studies) and China (Wuhan). Matthew is also the founding managing editor of the Caribbean Journal of International Relations & Diplomacy. His primary area of research interest is the political economy of development, with a particular focus on small states in general, and the Caribbean specifically. He also works on trade politics, democ­ratisation, rising powers, and international drug policy. He is the author of two books: The Political Economy of Caribbean Development, and, with Jean Grugel, Democratization: A Critical Introduction, both published by Palgrave in 2013; and the co-­editor, with Peter Clegg and Rosemarijn Hoefte, of Post-­Colonial Trajectories in the Caribbean: the Three Guianas (Routledge, 2017). Clara Brandi is Senior Researcher and Project Leader at the German Development Institute/Deutsches Institut für Entwicklungspolitik (DIE). As an economist and political scientist, she works on global governance questions, trade and international normative theory, focusing on sustainable development and the linkages between trade and the environment with a special interest in the role of developing countries and rising powers. She has published a number of journal articles, book chapters and policy briefs on these and related topics. She completed her PhD at the European University Institute, a Master’s in Economics from Albert-­Ludwigs-Universität Freiburg and an MPhil in Politics from the University of Oxford.

Contributors   ix Klaus Dingwerth is Professor in Political Science with a Focus on the Political Theory of the Globalized and Digital Society at the University of St. Gallen, Switzerland. His research interests lie at the intersection of global governance and political theory, with his current research focusing on the legitimation of international organizations in general and the rise of a democratic legitimation narrative in particular. His books include The New Transnationalism: Transnational Governance and its Democratic Legitimacy (Palgrave Macmillan, 2007), Postnationale Demokratie (VS Verlag, 2011, with M. Blauberger and Ch. Schneider), and International Organizations under Pressure (Oxford University Press, forthcoming). Matthew Eagleton-­Pierce is a Lecturer in International Political Economy at the School of Oriental and African Studies, University of London. His primary research interests lie at the intersection between political economy and sociology, including the politics of world trade, the history of neoliberalism, and the conceptual analysis of power and legitimacy. He is the author of Symbolic Power in the World Trade Organization (OUP, 2013), a book which explores how the thought of Pierre Bourdieu can shed new light on trade diplomacy; as well as Neoliberalism: The Key Concepts (Routledge, 2016), a guide to the vocabulary of contemporary capitalism. He previously taught at the University of Oxford, the London School of Economics, and the University of Exeter. Angela Geck is a Research and Teaching Associate at the Institute of Political Science, University of Freiburg. Her research deals with discourses, practices and power structures in international institutions. In her PhD, completed in 2015, she analysed practices of strategic arguing in WTO negotiations and their linkage to north-­south power relations. Currently, she works on institutional dynamics in the fields of climate change and human rights. Valbona Muzaka is Senior Lecturer in International Political Economy at the European and International Studies Department, King’s College London, UK. Her research interests include issues related to the governance of intellectual property rights, trade and global public health, as well as the knowledge economy, development and the emerging economies, especially India and Brazil. She is the author of a book on the politics of intellectual property rights and access to medicines, The Politics of Intellectual Property Rights and Access to Medicines (Basingstoke: Palgrave Macmillan, 2011) and of a number of journal articles and book chapters on these and related topics. She is currently completing a new book on the politics of biotechnology and access to medicines in India and Brazil. Lukas Linsi is a Post-­Doctoral Research Fellow at the University of Amsterdam. His research interests cover the role of narratives in international economic affairs, the politics of statistics and the political economy of executive remuneration. He completed his PhD at the London School of Economics in 2016 and was previously a Visiting Scholar at Harvard’s Weatherhead Center for International Affairs.

x   Contributors Emily Lydgate is a Lecturer in Law at the Law School of the University of Sussex. She specialises in the legal dimensions of international trade, and in particular its interaction with environmental governance and regulation. Emily is a fellow of the UK Trade Policy Observatory and has consulted at the United Nations Environment Programme Economics and Trade Branch. She has published articles in the Journal of World Trade, World Trade Review and Journal of International Economic Law. Michael Strange is Reader in International Relations at the Dept. of Global Political Studies, Malmö University. He has authored Writing Global Trade Governance – Discourse and the WTO (Routledge, 2013), and his research has appeared in journals including Critical Policy Studies; Politics; International Journal of Public Administration; Global Discourse; Alternatives: Local, Global, Political; Journal of Civil Society; Media, Culture & Society; and, Geopolitics. He is a regular reviewer for journals including European Journal of International Relations, International Political Sociology; and, Third World Quarterly. He has a background in institutional analysis of both the European Union and the World Trade Organization, and he is a co-­ founder of the IPE Öresund network. His research covers both trade governance, civil society, social movements, and transnational forms of legitimacy and democracy. Clara Weinhardt is a Lecturer in International Relations at the Hertie School of Governance and a Non-­Resident Fellow at the Global Public Policy Institute (GPPi). She previously held positions as postdoctoral researcher at the Bremen International Graduate School of Social Sciences and at the University of St. Gallen. She has also been a Research Associate at GPPi’s Innovation in Development programme. Her research interests combine questions of global governance with theoretical approaches to international negotiations, with a particular focus on the issues in the areas of trade and development. Her empirical research focuses on EU–Africa relations, and emerging countries, especially China. She completed her PhD in International Relations at the University of Oxford; her work appeared among others in International Studies Quarterly and the Journal of Common Market Studies. Gary Winslett completed his Ph.D. in Political Science at Boston College in 2016 and was a Max Weber Postdoctoral Fellow at the European University Institute in 2016–2017. In 2018, he joined the Political Science department and International Politics and Economics Program at Middlebury College. His research focuses on the political economy of international trade and specifically on the intersection of trade and domestic regulations pertaining to the environment, consumer safety, labour standards, and intellectual property. He also researches the political economy of the relationship between the tech industry and the U.S. government.

Acknowledgements

It has been a while since our idea for this book first emerged after a workshop we hosted in St. Gallen in spring 2015. Titled ‘Thinking about Trade: Cognitive Approaches to World Trade Politics’, the workshop explored how the ways we imagined, understood and made sense of world trade politics were, at the same time, forces that shaped how actors behaved in world trade politics. While the two of us had not approached the workshop with an edited volume in mind, the many discussions over coffees, lunches, dinner and drinks led us to see some value in a different kind of product: a book that maps the mind maps we use to make sense of world politics; that provides insights into how thinking about trade has developed over time; that values essays as a form of writing in the social sciences; and that could itself be of value to the efforts of lecturers as well as students tackling conventional questions of world trade politics from a slightly different angle. This book is the outcome of these discussions and the longer process of writing, rewriting and editing to follow. We hope it delivers on the promises listed above. Like with any academic project, however, it took more than just us to get it started, let alone cross the finishing line. In brief, this book could not exist without the support numerous individuals and institutions have offered. Starting with individuals, our biggest thanks goes to the contributing authors. Some of them were part of the initial workshop; others joined the project at a later stage when we were looking for experts on a particular ‘term of trade’. All of them had many other commitments besides their contribution to our volume. And yet, they not only signed up to write one-­word titled chapters along the lines we suggested, but also responded carefully and – most often – quickly to several rounds of comments from us as well as to the recommendations we received from two anonymous reviewers. Hence, this book is the product of its contributing authors as much as it is ours. Institutionally, the Swiss National Science Foundation (SNSF ) helped with a mobility grant that allowed Clara to visit St. Gallen for two months and prepare, among many other things, the workshop that led to this volume. Our collaboration was further facilitated by a subsequent grant from the University of St. Gallen’s Basic Research Fund where Stefan Graf was particularly helpful in figuring out how to make things possible. The Global Democratic Governance Profile

xii   Acknowledgements Area at the University of St. Gallen provided funding for the initial workshop, with Hilde Engelen lending a hand in the organisation of the workshop itself. Finally, the University of St. Gallen (in Klaus’s case), the University of Bremen, and the Hertie School of Governance (in Clara’s case) provided the institutional environments in which an edited volume like ours could thrive. We gratefully acknowledge the support of all these bodies. Beyond the authors and facilitators, we are grateful to all those who have commented on earlier drafts of the book or its parts. At the initial workshop, Carolyn Deere-­Birkbeck, Regina Hack, Juan Sebastian Palacio, Ellen Reichel, Henning Schmidtke, and Silke Trommer provided valuable comments on the papers that were presented. Subsequently, Felix Berenskoetter provided written comments on our framework chapter. In addition, two anonymous reviewers commissioned by Routledge carefully read the entire manuscript and made thorough and very constructive recommendations that helped us to further hone our arguments. In the final stages of making this book, Pieter Rhynhart provided valuable research assistance. Finally, at Routledge, we encountered much enthusiasm and support for our ideas. We thank Rob Sorsby for his guidance throughout the process; Eleni Tsingou, James Brassett and Susanne Soederberg for taking our volume under the wings of the RIPE Series in Global Political Economy; and Claire Maloney for her advice in the final stages of preparing our manuscript. Berlin and St. Gallen in March 2018

Abbreviations

ACP group AEHT AEU AfDB BEA BPM CITES

African, Caribbean and Pacific group of countries Amazon Europe Holding Technologies Amazon EU Sarl African Development Bank US Bureau of Economic Analysis Balance of Payments Manual Convention on International Trade in Endangered Species of Wild Fauna and Flora CPB Cartagena Protocol on Biosafety CSOs Civil society organisations CTE Committee on Trade and Environment CUSTA Canadian–United States Free Trade Agreement DFQF Duty-­Free Quota-­Free DG Director-­General DG Trade European Commission’s Directorate General for Trade DMD Doha Ministerial Declaration EEC European Economic Community EGS Environmental Goods and Services EIF Enhanced Integrated Framework EMIT group Group on Environmental Measures and International  Trade EPA U.S. Environmental Protection Agency EU European Union FAO Food and Agriculture Organization FTAs Free trade areas G20 Coalition of developing countries pressing for ambitious reforms of agriculture in developed countries G77 Group of 77 developing countries GATS General Agreement on Trade in Services GATT General Agreement on Tariffs and Trade GDP Gross Domestic Product GI Geographical indications GSP Generalized System of Preferences

xiv   Abbreviations ICSTD

International Centre for Trade and Sustainable Development ILO International Labour Organization IMF International Monetary Fund IP Intellectual property ISD Investor–state dispute ISO International Organization for Standardization ITO International Trade Organisation LDCs Least Developed Countries MDGs Millennium Development Goals MEAs Multilateral environmental agreements MFN Most-­favoured nation MNC Multinational Corporation NAFTA North American Free Trade Agreement NGO Non-­governmental organisation NIEO New International Economic Order NPR Non-­product-related NTBs Non-­tariff barriers OECD Organisation for Economic Co-­operation and Development OIE World Organization for Animal Health PPMs Processes and production methods RTA Regional Trade Agreements S&D Special and Differential Treatment SIDS Small Island Developing States SPEs Special Purpose Entities SSM Special Safeguard Mechanism TBT Technical Barriers to Trade TPP Trans-­Pacific Partnership TRIPS Agreement Agreement on Trade-­Related Aspects of Intellectual Property Rights TTIP Transatlantic Trade and Investment Partnership UNCHE UN Conference on the Human Environment UNCTAD United Nations Conference on Trade and Development UNEP United Nations Environmental Program UNFCCC United Nations Framework Convention on Climate Change US United States USTR United States Trade Representative WIPO World Intellectual Property Organization WTO World Trade Organization

1 Terms of trade Introduction Klaus Dingwerth and Clara Weinhardt

Introduction Each year in fall, before they embark on their journey to warmer places, migratory birds congregate in large numbers in the Northern hemisphere. For some species, the sites at which they gather remain fixed over the years; other kinds are more flexible, thus allowing them to choose among several places that offer a set of specific qualities the birds cherish. Once the birds arrive, however, the scenes resemble each other: gatherings of pre-­migration flocks are not only very lively, but also full of sound. Chirping and tweeting is heard all over the place, with some birds quacking aloud while others intone a finer melody. In a way, the meetings of the international trade policy community are not so different. Throughout the year, that community also meets regularly, with meetings including quite some posturing and comparing status. Towards the end of each year, moreover, the world trade calendar brings together the entire community in one place. Its members meet to take stock, negotiate and formulate an agenda that will lead them, not to a warmer place, but into a more prosperous future. For a long time, the place of their gathering has been fixed. Traditionally, meetings took place in Geneva, the city that hosted the secretariat of the General Agreement on Tariffs and Trade (GATT) from the latter’s establishment in 1947. Once the old GATT gave way to the new WTO in 1995, the rhythm of the meetings changed from annual to biennial. The places of meetings have also become more diverse; but they, too, need to fulfil certain criteria. While birds appreciate wetlands, coastal zones or isthmuses, the trade policy community requires the proximity of an international airport, a large enough congress centre and effective guarantees for the physical security of the delegates. But most importantly, like the gathering site of a pre-­migration flock, meetings of the international trade policy community include a lot of chirping and tweeting, with some delegates raising their voices while others seek to gain attention by weaving a subtler argument. Granted, the analogy is a bit of a stretch. But the same could be said of some of the analogies and metaphors the trade policy practitioners use to argue their case. To do so, they claim that a ‘conclusion of the Tokyo Round [is] absolutely essential to the future health of the world trading environment’ or that, on the

2   Klaus Dingwerth and Clara Weinhardt whole, ‘the system had withstood the shocks to which it had been subjected’. They hold that the GATT is ‘the guardian of free trade’ and the export sector an ‘engine of growth’ for GATT members. And they maintain that the world economy is ‘at a crossroads’, that ‘dark clouds are on the horizon’ or that GATT members need to ‘stem the tide’ when protectionist pressures mount.1 Of course, we all know that the world trading environment can neither be ‘sick’ nor particularly ‘healthy’ in a literal sense; that the export sector is an ‘engine’ only in a figurative way and that ‘dark clouds on the horizon’ are a code for something else, namely the prospect of something unpleasant happening. But if this is so, why would the delegates of GATT members wish to use figurative language at all when seeking to defend the interests of the countries they represent? This question is puzzling indeed when seen from the perspective of conventional approaches that explain world trade politics as resulting from interests weighted by power. If interests and power were all that counted, there would be no need to package one’s interests in imaginative language. Game theorists might account for linguistic tricks as tools to deceive the other side about one’s true intentions, or as a means of publicly tying oneself to a position in a negotiation; but they would not see language as a key dimension of trade politics itself. In this volume, we take a different route. We start from the assumption that language, to use yet another image, is the vehicle we use to make sense of trade politics in the first place: it is the means through which we come to imagine international trade and its regulation. Language, however, does not only matter where it is used in a figurative sense to conceive of ‘one kind of thing in terms of another’ (Lakoff and Johnson, 1980, p. 5). In contrast, many of the chapters in this volume show that language matters as a means to define – and institutionalise – ‘what is’ and to draw boundaries (Boltanski, 2011). Based on this assumption, we use this book to unpack the terms of trade in a more literal sense, namely by examining the concepts through which we have come to make sense of world trade politics.2 In which different ways is ‘multilateralism’ used and understood in trade politics? Which images and which other concepts do speakers invoke when they say that ‘progressive liberalisation’ is a prerequisite for ‘inclusive growth’? Which roles do these and other concepts play in the politics of world trade? And how and where does contestation over the terms of trade, literally understood, take place? Finally, the concepts we use to make sense of trade politics are not merely descriptive but also normative. They define not only ‘what is’, but also ‘what has value’ (Boltanski, 2011). Thus, if someone says the WTO is ‘not democratic’, competent speakers will recognise that the statement communicates a description as well as an evaluation: the WTO is not democratic, but it should be! Actors thus often use a specific term of trade strategically to make sense of world trade politics in a particular way: concepts make some aspects of reality visible and others invisible, thereby giving specific meanings to the phenomena that surround us. At the same time, while many things may be said, not all of them will

Terms of trade: introduction   3 be equally persuasive to a target audience. Instead, the concepts trade policy (and other) actors have built in the past constitute a social structure that shapes how world trade politics may be represented, what prior beliefs we have about it and, finally, which policies can be imagined, made and publicly justified. In short, a further aspect of our initial analogy may be more to the point. For as bird flocks gather at their pre-­migration sites, their chirping and tweeting remains incomprehensible to most of us, except maybe a few ornithologists. Nonetheless, we can assume that the birds themselves can ‘decode’ and ‘make sense of ’ the same chirping and tweeting and put it to use in coordinating their communities. In the trade world, too, the language that trade policy practitioners use is full of jargon and often unintelligible to outsiders. Which layperson, for instance, could decipher and correctly interpret a statement of US trade diplomats that asserts that ‘ “non-­violation” complaints are fully appropriate under the [Agreement on Trade-­Related Aspects of Intellectual Property Rights (TRIPS Agreement)]’ (WTO, 2015, p.  37)? For those on the inside of the world trade discourse, however, terms like ‘non-­violation complaints’, ‘special and differential treatment’ or the ‘Singapore issues’ are not only full of content and history, but they also fulfil important and often very specific functions as reference points in a broader discourse. It is these forms of content, histories and roles in which we are ultimately interested in this book. In terms of their content, the terms of trade we examine are linked to particular sets of ideas, ideologies and beliefs that underpin social order. In terms of their histories, the meaning of specific terms of trade are not fixed. Instead, they may change depending on the discursive and historical context and on the power the actors who seek change can summon behind their position (see Berenskoetter, 2016a, pp. 9–11). Finally, in terms of their roles, the terms of trade we examine reflect and reify social realities by shaping what kinds of action are conceivable and desired. Set against this background, the individual contributions in this volume respond to three broad questions. First, how and by whom were the meanings of different terms used to describe, challenge and defend world trade politics originally constructed? Second, how have the meanings as well as the roles of the concepts we use to make sense of world trade politics become contested? And third, how did the changing ‘terms of trade’ create some possibilities for actions while closing the door on others? In their efforts to answer these broad questions, our contributing authors study concepts primarily in their socio-­ political function rather than as analytical categories that are part of an academic discourse. As a result, they pay attention to the ways in which political actors contest and reconstruct the changing meanings of a concept over time, and how new interpretations shift the boundaries of what is politically possible. The answers they give provide a fresh perspective on world trade politics. They shed light on how we have come to think about the trade regime the way we do, on why certain trade issues and agendas win over others, on who benefits from the ways trade governance is discursively structured, and ultimately also on why multilateral trade talks have come to a halt.

4   Klaus Dingwerth and Clara Weinhardt In larger perspective, our book contributes to a growing body of literature on ‘concepts in world politics’ (Adler-­Nissen, 2012; Berenskoetter, 2016b; Mhurchuú and Shindo, 2016). In very general terms, we build on this literature in our effort to trace ‘ongoing attempts to challenge (reimagine) the possibilities of state-­based international relations’ (Mhurchuú and Shindo, 2016, p.  2). More specifically, we contribute to this strand of writing by reconstructing particular instances of concept invention, concept fixation and concept transformation (Berenskoetter, 2016a, p. 10). Doing so in relation to world trade politics naturally links our effort to others in the field, notably Matthew Eagleton-­Pierce’s (2016) Neoliberalism: Key Concepts and Erin Hannah, James Scott and Silke Trommer’s (2015) collection Expert Knowledge in Global Trade. We go beyond this literature, however, by focusing specifically on how a set of concepts have been or become central terms of trade in recent decades. In doing so, we follow Koselleck (2011, p. 32) in selecting what we see as key terms of the world trade regime for pragmatic reasons. Yet, while all terms examined in this volume play a central role in the socio-­political language that has come to characterise our conceptions of world trade politics, our list is neither conclusive nor exhaustive. Notably, concepts like ‘trade’ and ‘protectionism’ have been at the core of the world trade regime for a long time, whereas other concepts like ‘democracy’ and ‘environment’ have gained prominence only recently. As a result, the dynamic nature of the terms of trade becomes an important part of what we seek to unpack in this volume. Finally, a focus on language does not imply that material interests and power do not matter in trade politics. Such a claim would be silly. What we do claim, however, is that material interests and trading volumes are not all that matters, and that one important form of power lies in the ability to define the terms of trade. If these terms shape how we imagine trade politics, they are not merely analytical lenses; and if actors are aware of the power of words, they will seek to employ them to make sense of world trade politics in particular ways: to make some aspects of reality visible and others invisible, to make some aspects seem problematic while normalising others, or to make some responses appear reasonable while others remain ‘incomprehensible’ (Suchman, 1995, pp. 582–584). In other words, because the terms of trade shape the ‘arena of political possibilities’ (Wilkinson, 2009, p.  600), the language in which world trade politics is made and imagined reflects but also recreates hierarchies and power relationships.

What concepts do Concepts, Gregory Murphy (2002, p. 1) states in his Big Book of Concepts, are ‘the glue that holds our mental world together’. Concepts, and the way they relate to each other – be that in classificatory schemes or in ‘chains of equivalence’ – shape how we perceive the world. It is in this sense that Nicholas Onuf can argue that, ‘ruled by language and its rules, we make rules and instantiate rule, thereby making the world what it is for us’ (Onuf, 2013, p. xv). Yet concepts do not only provide the basis to make sense of the world for us. In contrast,

Terms of trade: introduction   5 language also plays a role, as Onuf (2013, p. xviii, emphasis added) further elaborates, in making the world ‘seem more or less the same for everyone’. As a consequence, language is inherently linked to power in the sense that ‘the world thus made will always work to the advantage of some at the expense of others’ (Onuf, 2013, p. xv). It is these three basic ideas – language as a means of world making for us, language as a means of world making for everyone, and language as a means of structuring power – that broadly inform our volume. Language and world making for us Without concepts, we could not organise our sensual impressions, let alone begin to reason. So, concepts are a basic ingredient for making sense of the world. In brief, ‘by relating certain phenomena to each other and keeping others apart, concepts fulfil the central function of ordering and structuring our perception of the world’. Moreover, by allowing us to generalise, they are also ‘fundamental to individual and collective learning processes’ (Dingwerth and Pattberg, 2006, p. 186). That is a relatively simple idea, but since ‘our conceptual system is not something we are usually aware of ’ (Lakoff and Johnson, 1980, p.  3), we tend to underestimate how much it shapes how we see the world. Basically, concepts and conceptual schemes respond to questions such as ‘What is X?’ or ‘What is X a case of?’, but the role of language also goes further in that it allows us to draw analogies – responding to questions such as ‘What is X structurally similar to?’ – or establish metaphorical links between phenomena, responding to the question like ‘In terms of which other thing could X be conceived?’. The latter aspect has been emphasised in the work of Lakoff and Johnson (1980) who argue that many of our concepts are ‘metaphorically structured’: we conceive arguments in terms of war, time in terms of money, ideas in terms of objects, and words as containers of such objects. This is not to say that we sometimes say that ‘time is money’ but rather that, in our everyday talking about time, we make use of a long list of expressions that follow the logic of ‘time is money’ – for instance when we ‘invest’, ‘spend’ or ‘give’ time. As a result, Lakoff and Johnson (1980, pp. 7–9) argue, our concept – and hence our understanding – of time is systematically structured in terms of another concept, namely money. In the social realm of politics, the contributions to Terrell Carver and Jernej Pikano’s (2008) Political Language and Metaphor underline the relevance of metaphors in domestic as well as international political debate, while Michael Marks’ (2011) analysis of International Relations theories reveals how our understanding of international politics is influenced by metaphorical constructions. Language and world making for everyone Lakoff and Johnson (1980, p. 3) use language as ‘an important source of evidence for what the [conceptual system that we use in thinking and acting] is like’. Accordingly, their primary focus is on how language in general – and metaphorical structures more specifically – helps us to make sense of the world. Social

6   Klaus Dingwerth and Clara Weinhardt scientists, in contrast, have mainly been interested in how language structures the world for the members of a given community or for those forming part of a common social order. The label under which much of this work falls is, of course, ‘social construction’. Ian Hacking’s (1999) The Social Construction of What? not only reveals how long the list of things said to be ‘socially constructed’ has become in recent years, but also what the common structure of arguments about social construction looks like. According to Hacking (1999, p. 12), a key assumption shared by many works is that ‘In the present state of affairs, X is taken for granted; X appears to be inevitable’, with the work then demonstrating how X is, in fact, contingent rather than inevitable. ‘The economy’, he thus holds, could be examined as a social construct: Every day we read that the economy is up or down, and we are supposed to be moved to fear or elation. Yet this splendid icon, the economy, was hard to find on the front pages of newspapers even forty years ago. Why are we so unquestioning about this very idea, ‘the economy’? One could argue that the idea, as an analytical tool, as a way of thinking of industrial life, is very much a construction. (Hacking, 1999, p. 13) Or, he imagines, social constructivist researchers could unmask the idea of a ‘deficit’ by showing how it was ‘constructed as a threat, a constraining element in the lives of many, an instrument of the hegemony of capital’ (Hacking, 1999, pp. 13–14). The important aspect here is that once the term ‘deficit’ functions in this way within a social order, it becomes a vehicle for collective world making that makes certain forms of behaviour more plausible, more appropriate or even more imaginable than others. These insights on how language, and the meanings constructed through it, are central to any social order also apply to the realm of global governance. As Bjola and Kornprobst (2010, p.  1) remind us, ‘global (in)action amidst collective problems is not just interest-, issue- or inspiration-­ driven, but – on a more fundamental level – shaped by the argumentative processes that define what the actors’ interests, global issues and political imagination are in the first place’. In a related fashion, Luc Boltanski’s pragmatic sociology of critique takes the uncertainty which results from the fact that ‘each individual can only have one point of view on the world’ (Boltanski, 2011, p. 59, emphasis in the original) as its starting point. The means to cope with (rather than overcome) such uncertainty are institutions. Boltanski understands institutions as primarily semantic, hence comprising definitions as well as classificatory schemes. On this account, institutions constitute ‘the means it seems necessary to employ to reduce [uncertainty], or at least to diminish the unease it creates, and to get something to hold together even minimally – that is to say, for there to be some reality’ (Boltanski, 2011, p. 61, emphasis in the original). The way in which institutions accomplish this feat is by fixing the relationship between states of affairs (which Boltanski

Terms of trade: introduction   7 calls ‘the world’) and symbolic forms (which Boltanski calls ‘reality’): institutions state ‘what is’ and ‘what has value’ (Boltanski, 2011, pp.  69–70). As a result, a strong institution in Boltanski’s use of the term is one that provides for a particularly ‘robust reality’ – a ‘reality’ that is unlikely to be questioned. This might be because the ‘reality’ formulated by an institution is so taken for granted that alternative ways of seeing the world are either hard to imagine or fail to persuade a sufficiently large audience. Or it might be because the fixing of meaning that is associated with institutions produces costs for those who, willingly or not, ignore the ‘reality’ thus constructed. Applied to the world of global governance, these insights point to the arbitrary nature of some of the ways in which international institutions ‘fix’ a particular reality – and the consequences such a fixing may have. Nelson and Katzenstein (2014, p.  379), for example, point out how the financial crisis of 2008 was made possible by the economic conventions the actors adopted to cope with uncertainty. Banks and credit rating agencies relied on deeply flawed concepts when modelling risks because their risk-­management models ‘offered the illusion that irreducible uncertainty could be transformed into manageable risk’. But language is not only about ‘fixing reality’. It is also essential for creating specific realities, notably through ascribing the status that an object or person holds. Such status ascriptions go hand in hand with certain understandings of ‘what is good, right and permissible to do to others’ (Bjola and Kornprobst, 2010, p. 12), thereby contributing to world making for everyone. For instance, the collective ascription of a status as a ‘benevolent hegemon’ in international politics leads to a reality in which it is permissible for the hegemon to carry out state interventions. This contrasts with a view of the world in which the hegemon is ascribed the status of a ‘tyrant’. Language thus shapes which status actors or objects hold within a social order, and it constitutes the most basic frame of reference in which actors interpret and appraise choices they and others make (Kratochwil, 1989, p. 11). Language and power This latter point provides a natural link to questions of power. For constructivist scholars ranging from feminists to Foucauldians, it has always been self-­evident that their studies about the ‘social construction of X’ were essentially studies of power. Yet, other strands of writing tend to associate power more readily with its material dimension – for example, as the ability to get one’s will by physically threatening or economically incentivising others to behave in a certain way. As a result, those adhering to theoretical traditions other than constructivism have occasionally found it difficult to notice how studies of ‘webs of meaning’, rather than of the relative size of armies or treasuries, could shed light on the question of power. It may thus be useful to spell out that link, if only to avoid the impression that our volume, while possibly comprising some interesting stories, ultimately says little about how power is exercised in global trade governance.

8   Klaus Dingwerth and Clara Weinhardt As a starting point, notions such as ‘productive power’ (Barnett and Duvall, 2005) or Bourdieu’s ‘symbolic power’ (Bourdieu, 1991) that have been central to critical IR scholarship draw our attention to the link between language and power. Fixing meanings is not merely a linguistic exercise. Instead, ‘discourses are sites of social relations of power because they situate ordinary practices of life and define the social fields of action that are imaginable and possible’ (Barnett and Duvall, 2005, p. 56) – an insight which draws on Foucault’s analysis of how discourses normalise particular actor positions (Foucault, 1972, pp. 50–55). A particular meaning of trade, for instance, defines not only which social activities count as trade, but also what the identity of a ‘trader’ entails, and whose knowledge matters in shaping trade relations. Drawing on Bourdieu, Eagleton-­Pierce (2013, p. 49) argues that political language – ‘as a pre-­eminent symbolic system’ – is essential to creating and maintaining power relations in world trade politics (see below). Such understandings of the link between power and language often focus on semantic constructions, and the ways in which they create ‘orders of justification’. In a way, Boltanski’s work already entails the claim that semantic institutions are closely connected to power because they define what is and what has value. By implication, then, those who have a capacity to affect, shape or even control semantic institutions wield significant power. Yet power, unless its exercise is effectively masked, is usually subject to ‘the requirements of justification’ (Boltanski, 2011, p.  2). Accordingly, those who hold power will usually seek to defend the underlying asymmetries as legitimate. These defences draw on as well as inform what Rainer Forst has labelled ‘social orders of justification’: orders that are, once more, discursively structured. Like Boltanski, Forst holds that power is rooted in accepted justifications – that it takes, as he calls it, a primarily ‘noumenal’ form (Forst, 2015, p. 65). To have power, then, means to be able ‘to influence, make use of, define occupy or even seclude’ the realm of accepted justifications for others (Forst, 2015, p. 66, our translation). This ability is primarily, though not exclusively, rooted in language, hence turning the ability to shape language into a fundamental source of power in social orders. The role of language in world trade politics In the mainstream literature on world trade politics, language plays only a marginal role.3 Amrita Narlikar, Martin Daunton and Robert Stern’s (2012) Oxford Handbook of the World Trade Organization, for example, provides a comprehensive overview of what the World Trade Organization (WTO) does, how it goes about fulfilling its tasks, its institutional evolution, agency in the WTO, and how it might contend with some critical challenges. An ideational perspective, however, is not systematically covered, leaving little space for a critical examination of the role of language in shaping central terms of world trade politics. Tellingly, while the Handbook’s section on ‘Normative Issues’ deals with fairness, labour standards, human rights and the link between trade and environment, it remains silent on the normative underpinnings of the very terms that

Terms of trade: introduction   9 define the core of the world trading system – including the language used to define ‘free trade’, ‘multilateralism’ or ‘regulatory measures’.4 On ‘free trade’, the handbook, for instance, simply assumes that ‘the case in favour of free trade is theoretically clear and empirically rich’ (Narlikar et al., 2012, p. 2). This omission reflects a general tendency in the mainstream literature to conceive of world trade politics primarily in terms of interests weighted by power (see Hoekman and Kostecki, 2009). A growing constructivist body of literature on International Political Economy (for an overview, see Abdelal et al., 2010), however, has begun to acknowledge the importance of discourses and the ideas embedded therein for trade governance. While the existing literature does not yet provide a systematic overview of key ‘terms of trade’ and their contested nature, it touches upon several insights about the role of language that the different contributions of this volume build on in diverse ways. First, constructivist scholars highlight that the historical evolution of the world trading system cannot be understood without regard to the dominant economic ideas and paradigms that have prevailed over time. What John Ruggie (1982) referred to as ‘embedded liberalism’ – a liberalism that grants governments some policy space at the domestic level to reduce the social costs of trade openness – has become a powerful reference point in thinking about the social purpose and legitimation of the post-­war trading order. More recently, Andrew Lang shows from a legal perspective how the concept of ‘neoliberalism’ gradually replaced the ‘embedded liberalism’ compromise from in the 1970s onwards (Lang, 2011; see also Eagleton-­Pierce, 2016). These shifts in economic thinking transformed the purpose of the world trading regime itself. Instead of balancing the social welfare state with the gains in free trade, the pursuit of ‘progressive growth’ increasingly became an end in itself. Neoliberal ideas thus led to a re-­imagination of the nature of politics, as it made it increasingly illegitimate for governments to intervene in the economy to reduce the social costs of trade liberalisation (Lang, 2011, p. 7). Language mattered for this transformation to take place, because neoliberal narratives provided a new understanding of the government’s most efficient way to regulate the economy – an understanding that became dominant ‘by appealing to scientific generality’ (Blyth, 2002, p.  148). The constructivist literature also points out some of the key ‘norm entrepreneurs’ (Finnemore and Sikkink, 1998) that helped to establish these new economic ideas in the discourses on trade. They range from business foundations such as the Scaife Funds and the Olin Foundation in the US (Blyth, 2002, p. 159), the members of the so-­called Chicago school (see Chwieroth, 2010) to international economic institutions such as the International Monetary Fund (Best, 2013) or the World Bank (Moretti and Pestre, 2015; Weaver, 2010). Some authors among this strand of the literature also point out that the dominance of neoliberal economic ideas in the trade discourse limits the power of actors who seek to move global trade politics in an alternative direction – one that is not easily reconcilable with the core tenets of neoliberalism. In the early to mid-­1990s, so-­called ‘non-­trade values’ were introduced into the debate about

10   Klaus Dingwerth and Clara Weinhardt trade politics. In particular, civil society actors claimed that the GATT and the newly built WTO undermined member states’ efforts to protect ‘the environment’, keep ‘food safety’ standards intact or secure adequate ‘labour standards’ (O’Brien et al., 2000). Yet, as Lang (2011) claims, the neoliberal turn imposes severe constraints on re-­imagining trade in ways that may include non-­trade values. For instance, the language of ‘coherence’ that came to dominate the relationship between the trade regime and trade-­related issue areas such as the environment or human rights shifted debates to questions of institutional design (Lang, 2011, p. 130; see also Anderl, this volume). Others point out how the ‘liberal and legal epistemic foundations’ made it more difficult for NGO actors to push for more just and sustainable trade policies (Hannah, 2011, p. 181), or emphasise the biases inherent in the terms associated with economic liberalism. For instance, government regulation is discredited as a ‘non-­tariff trade barrier’, while the term ‘neoliberalism’ is notably absent in the discussions at the WTO’s largest annual outreach event, the WTO Public Forum (Hopewell, 2015, p.  1139). Yet, not all scholars regard the language of world trade politics as a constraint on the power of certain actors. Cho (2014, p. 689), drawing on a ‘thin’ version of constructivism, emphasises that the WTO’s legal norms are important for establishing a  shared language among its members, which in turn facilitates interaction by creating ‘certain stabilized standards or expectations’. Second, constructivist-­leaning scholars shed light on the techniques actors use to change the dominant ways of talking about trade, often to counteract a marginalised position they find themselves in. Matthew Eagleton-­Pierce (2013), for example, draws on Pierre Bourdieu’s notion of symbolic power to explore the strategies Southern countries adopt in their pursuit of a more equitable trading order. He shows not only how seemingly technical or neutral terms are in fact highly political, but also reveals how developing countries make use of framing and mimicry – a technique of either social adaptation or subversive appropriation of an opponent’s argument – to legitimate their demands for ‘asymmetrical market opening’ in the WTO’s negotiations over agriculture. Mlada Bukovansky (2010, p.  88), in turn, examines Southern countries’ attempts to delegitimise the position of Northern countries as a ‘hypocrisy of the strong’ in which Northern countries are depicted as unwilling to cut their own domestic trade-­distorting subsidies on agriculture, while they demand others to further liberalise their markets. Similarly, Jane Ford claims that developing countries (re)defined their identity in ways that became more compatible with the community of ‘multilateral traders’, thereby enabling them to discredit the arguments of Northern countries. This worked, notably, by ‘[adopting] the language of liberal economics to de-­legitimate attempts to incorporate labour and environmental standards in the trading regime’ (Ford, 2003, pp. 5 and 8). In the context of free trade negotiations, Del Felice (2014) shows how NGO actors strengthened the West African side’s opposition to signing a free trade agreement with the economically much stronger European Union through discursive processes of politicisation.

Terms of trade: introduction   11 In contrast, actors can also employ discursive strategies to sustain dominant power positions they already maintain. Rorden Wilkinson’s (2009) work thus shows how developed countries have strategically used a particular discourse on the concept of ‘crisis’ of the multilateral trading system to put pressure on developing countries. Based on a ‘crisis’ discourse, the latter were asked to make stronger concessions to avoid the alleged possibility of collapse. The use of metaphors, such as trade as a ‘bicycle’ that needs to be kept in motion, can also legitimise the ways in which the multilateral system already functions while diverting attention away from the outcomes it produces (Wilkinson, 2014). Moreover, Siles-­Brügge (2013, p. 599) shows how the European Commission’s Directorate General for Trade strategically employed narratives on globalisation to legitimise neoliberal economic programmes that were controversial at the level of member states and their societies. Finally, some constructivist-­leaning scholars have begun to focus more explicitly on the role of ‘experts’ and ‘expertise’ – including its strategic use – in shaping the discourses of global trade politics. Drawing on Bourdieu’s field theory, Hopewell (2015, p. 1139) argues that mastering the technical language of trade is a key ‘expertise’ for trade actors if they want to be regarded as credible. Hannah, Scott and Trommer (2016) assess in detail the structures that shape the monopoly over knowledge that trade experts hold, how expert knowledge in turn shapes trade policy making, and what tensions it leads to as actors seek to challenge the status quo. Third, the ‘thick’ constructivist literature that makes use primarily of post-­ structuralist methodologies shows how concepts are constitutive of world trade politics. Mortensen emphasises that legal classifications within the WTO project introduce a ‘rights’ discourse into global trade politics, which ‘provide[s] a structuring space, or communicative framework, in which actors debate over what is legitimate’ (Mortensen, 2012, p.  82). For instance, the reliance on customs classifications from the World Customs Organization has structured the field of trade in renewable energy in ways that legitimised the use of subsidies, despite opposition from developing countries. Michael Strange (2013) advocates for a theoretical perspective that reveals the discursive character of the WTO. It allows us, he argues, to examine ‘how something like “trade” can be articulated – and rearticulated’, including how language (re-)creates the boundaries of the world trade regime (Strange, 2013, p.  15). Empirically, his study shows that trade liberalisation was initially understood as a ‘weapon of the free world’ (Strange, 2013, pp. 41–42). Over time, it turned into a tool for development or an instrument against protectionist pressures, which had implications for the kinds of actors that were understood to be part of the trade regime. Accordingly, what trade is defined as being good for also determines who will be able to say how trade should be regulated. As a result, just how discourses about the terms of trade are fixed over time defines not only the realm of possible actions (see Epstein, 2008), but also who counts as a legitimate actor in world trade politics at a given point in time (see also Strange, this volume).

12   Klaus Dingwerth and Clara Weinhardt

How concepts change We have seen that concepts are important tools of world making. They render certain forms of behaviour plausible and create hierarchies by structuring the realm of accepted justifications. Yet, as the notions of invention, fixation, transformation, and disappearance suggest, concepts as well as the semantic fields they are part of are in constant flux (Berenskoetter, 2016a). While the meaning of words can be fixed, concepts by definition comprise ‘an abundance of meanings’ (Koselleck, 2011, p.  20).5 They are never truly fixed, and their dominant interpretation may change over time. With this volume, we therefore seek to shed light on the different ways in which the terms of trade change, how these changes come about, and how they matter. As all chapters show, to uncover how concepts change requires us to pay attention to the linguistic and socio-­political contexts in which contestation occurs. New concepts as well as new meanings of concepts are necessarily built in relation to existing ones which they can either replace, compete with or complement. First, some meanings of concepts – or entire concepts – may be dropped because the discourses in which they are embedded become marginalised. Initially, for example, trade was portrayed as a powerful tool for peaceful cooperation. This discourse receded to the background when other meanings like sustainable development became more central to the concept. Second, concepts may also come to mean new things as novel discourses emerge. The concept of ‘protectionism’ is a case in point. Initially referring to conventional tariffs or quotas as barriers to trade, it came to denote a broader range of ‘barriers’, including less tangible ones like labelling requirements or food safety standards (Winslett, this volume). Third, concepts may be linked in new ways. When calls for ‘democracy’ became more prevalent in the recent decades, the WTO Secretariat justified its decision-­making procedures by linking the concepts of ‘democracy’ and ‘consensus’ in new ways. This linkage allowed it to argue that its decision-­ making culture based on consensus made it the ‘most democratic’ of all international economic organisations (Dingwerth, this volume). Similarly, there are different ways to interpret the assertion in WTO treaties that trade and environment are ‘mutually supportive’ (Lydgate, this volume). How meanings change over time is, however, not arbitrary. As the authors demonstrate, the linguistic fields in which concepts are embedded reflect specific socio-­political contexts. Material changes in the ‘world’ may mean that concepts become obsolete or acquire new meanings. That the concept of trade has been broadened from the 1970s onwards was partly a result of the changing nature of trade, notably the turn towards ‘beyond the border’ regulation (Eagleton-­Pierce, this volume). Similarly, the far greater number of countries with more diverse interests operating in a context of shifting power relations in the world trading system means that the concept of ‘multilateralism’ has come under strain in the world trading system (Bishop and Muzaka, this volume). Likewise, the rise of new powers like Brazil, India and China has led to contestation of the binary distinction between developed and developing countries in the world trading

Terms of trade: introduction   13 system, including the differential rights they have access to (Weinhardt and Geck, this volume). In sum, it is therefore important to recall that both drivers of change – material and discursive changes – go hand in hand. With regard to the concept of trade itself, we see for instance changing forms of capitalist exchange interacting with the norms, values and beliefs of trade experts to generate new understandings of the thing called – and regulated as – ‘trade’ over time (Eagleton-­Pierce, this volume). In addition, our conceptual apparatus can also change because actors translate, reinterpret and reframe existing concepts or invent new ones – a phenomenon that Ronald Krebs and Patrick Jackson (2007) have aptly described as a contest of ‘twisting tongues’. All chapters therefore emphasise the role of meaning makers as ‘change agents’. The chapter on ‘democracy’, for instance, pits the WTO Secretariat and civil society actors against each other in a discursive struggle over how to define what makes the WTO more democratic (Dingwerth, this volume). Similarly, developed and developing country representatives make different claims about what it takes for the world trading system to be ‘just’ (Brandi, this volume) or ‘development-­oriented’ (Weinhardt and Geck, this volume). There can be, however, limits to the reinterpretation of concepts for strategic purposes. For instance, the chapter on ‘coherence’ shows that the term is probably the wrong argumentative instrument for a radical critique of the key norms of the world trading system (Anderl, this volume). Moreover, some of the chapters that follow draw attention to how scholars themselves are implicated in the ways in which concepts change. As the chapter on foreign direct investment illustrates, the failure to make transparent the criteria that both scholars and policy-­makers rely upon when referring to ‘Foreign Direct Investment’ reproduces the biases inherent to different measurement techniques that underpin the concept (Linsi, this volume). As scholars, we are also providers of and – often unconscious – diffusing agents for ‘specific ways of imagining worlds’ (Mhurchuú and Shindo, 2016, p. 7). Finally, the chapters show that while all concepts become contested over time, which leads to changes in the meanings attached to them, their degree of contestation varies. Walter Bryce Gallie (1956) prominently put forward the thesis that many concepts that relate to human relations are ‘essentially contested’. Their contested nature is linked not only to particular characteristics of concepts, such as being ‘open’ in character (Gallie, 1956, p. 172), but also to the inherent difficulty of fixing the meaning of concepts that relate to human behaviour rather than the natural world. As John Gray (1977, p. 339) has argued, ‘the major part of what makes a concept essentially contested is that criteria for its correct application embody normative standards’. The concept of ‘justice’ in the world trade regime is an example (Brandi, this volume). As universal agreement on its meaning is unlikely in ‘a social environment marked by profound diversity’ (Gray, 1977, p.  337), contestedness is inherent to the concept itself. Yet, as the chapter on ‘coherence’ (Anderl, this volume) reveals, even concepts that are less directly linked to normative standards become focal points for contestation, for instance when actors disagree whether to strive for ‘narrow’ or

14   Klaus Dingwerth and Clara Weinhardt ‘comprehensive’ coherence of trade with other issues (Anderl, this volume). In conclusion, paying attention to the normative standards that our communities associate with a concept allows us to account for different degrees of ‘contestedness’.

Outline of the book Each of the following chapters engages with a specific term of trade. The authors build their arguments on a systematic analysis of texts, ranging from annual reports of the GATT or WTO to international trade agreements, government statements on trade policy issues, and media representations of trade politics. Their analyses reveal the historical as well as the contemporary usage of the respective concepts in international trade politics, and they provide a contextualisation and theoretical reflection of the specific terms of trade they look at. At the beginning of each chapter, the authors provide a critical conceptual history of the specific term in the world trade regime. This overview addresses questions related to the mind maps, the discursive dynamics and the meaning makers of international trade politics. In relation to the mind maps, we ask: What precise role do concepts and ideas play in the world trade regime? How have they come to play these roles? And how exactly do they function in these roles? In view of the discursive dynamics, we examine: How has the meaning of the term evolved historically? How did change become possible? And what prevented change when it seemed possible? Finally, in response to the meaning makers, we ponder: Which trade actors have sought to coin the terms of trade? What explains their successes and failures? And what are distributional consequences of their more successful efforts to change our conception of international trade politics? In the second part of each chapter, authors zero in on a specific aspect of that conceptual history they find particularly noteworthy. While part one of each chapter thus serves to make the volume coherent, part two of each chapter brings the different theoretical perspectives of our diverse set of authors to the forefront. Combining a common ground in part one with a more creative and diverse approach in part two, we hope, makes explicit how we have come to see the politics of world trade in a very particular way, but also to imagine what alternative understandings might possibly look – or have looked – like. The order in which we present our terms of trade follows the logic of the policy field. We first present concepts that are fundamental to the very substance of the world trading system: ‘trade’, ‘protectionism’ and, as an example of an economic concept that relates to but goes beyond the notion of trade, the term of ‘foreign direct investment’. What follows are concepts that speak more directly to the institutional dimension of the world trade regime, its ‘multilateral’ nature and presumably ‘democratic’ decision-­making procedures, as well as the question of whether or not ‘civil society’ counts as an actor that may participate in them. Finally, we focus on concepts that link trade politics to other issues, including ‘development’, the ‘environment’ and ‘coherence’ as a more recent

Terms of trade: introduction   15 master frame. We conclude our examinations with the normative yardstick of ‘justice’ that has been at the heart of public contestations of the world trade regime since at least the Seattle protests in 1999. In Chapter 2, Matthew Eagleton-­Pierce explores three sets of struggles over the meaning and practice of the concept of trade itself. In doing so, he helps to clarify the relationship between changing material forms of capitalist exchange, the representation of such practices through concepts, and the experts who define such meanings in specific social and political contexts. In very general terms, Eagleton-­Pierce presents a two-­fold argument: first, that a historical look at ‘trade’ as a category reveals how it can be treated as a malleable ‘container’ into which different actors can empty their meanings; second, that the privileging of certain interests over others reveals how agendas linked to the concept of ‘trade’ are far from neutral. In Chapter 3, Gary Winslett examines the concept of protectionism. He argues that, since the late nineteenth century, protectionism has generally been understood to mean a curtailment of trade designed to protect domestic businesses from foreign competition. What has changed and, in the process of change also become highly contested, is exactly which trade policies can accurately be labelled protectionist. The chapter traces the concomitant transition in the major barriers to international trade and the mission creep expansion of how protectionism has come to be understood. Moreover, it shows that contestation over the meaning of protectionism has not just grown more contentious but expanded to new fronts, including practices of labelling. In Chapter 4, Lukas Linsi explains and illustrates some of the basic issues related to defining the term Foreign Direct Investment (FDI) as a statistical unit. He outlines how ‘FDI’, although practically existing for centuries, was only really discovered as an economic concept in the post-­war era when an emerging expert consensus saw FDI as different from other cross-­border capital flows. The chapter presents an overview of how the key criteria the International Monetary Fund (IMF ) advocated to be used by national agencies to statistically distinguish FDI from other portfolio capital flows changed over time. Highlighting some of the shortcomings of contemporary FDI statistics, the chapter also raises questions about the extraordinary authority and discursive power of socially constructed economic indicators more generally. In Chapter 5, Matthew Bishop and Valbona Muzaka critically examine the discourse on multilateralism in the world trading system. They argue that multilateralism is both a simple and relatively uncontroversial concept at first sight. Throughout its history, however, its application has waxed and waned, and it has been applied to describe, explain and legitimise a range of quite distinctive institutional arrangements in global governance. As a consequence, conflation of the concept with contemporary arrangements rests on an idealised caricature of the actually existing multilateralism of the past that reifies – in the case of trade – the WTO and constrains our understanding of the challenges the institution faces. The chapter argues that, when critics lament the alleged decline of multilateralism in today’s area of global trade politics, they obscure what is a far more

16   Klaus Dingwerth and Clara Weinhardt troubling concern: the lack of a ‘shared social purpose’ for governing global trade. In Chapter 6, Klaus Dingwerth examines the role that the concept of democracy plays in the world trading system. The chapter starts by reconstructing the process through which democratic values have become a legitimacy standard for the World Trade Organization. The reconstruction shows that, once the democratic frame had gained prominence in the highly visible Seattle protests, the WTO consciously adopted it and successfully re-­defined its core content to match the organisation’s practices. Highlighting the legacy of Seattle, however, the chapter hints that this may have been a Pyrrhic victory. When WTO officials held that the organisation’s voting rules, its consensus-­based decision-­making culture, and its practice of making a wealth of documents available to the public made it the ‘most democratic’ international economic organisation in existence today, they essentially accepted the protesters’ claim that ‘democracy’ was an appropriate normative yardstick for the WTO. Moreover, by building their democratic credentials on the consensus principle, they further reduced the scope for curtailing the latter in an organisation that had grown from 23 to over 160 members, thereby making the achievement of consensus a much more difficult endeavour. In Chapter 7, Michael Strange looks at the concept of civil society, which as a category of actorness has become central to global trade governance. Starting with a mind map of ‘civil society’, the chapter moves towards identifying a history of discursive battles over who or what can legitimately be classified as ‘civil society’. Underpinned by the normative recognition that the ‘civil society’ term has gained in global governance, the outcomes of these battles shaped who or what was recognised as an ‘NGO’ eligible for attendance at major trade summits like Ministerial Conferences of the World Trade Organization. In addition to the processes of normalisation that lead us to think we know what civil society is, the second part of the chapter discusses the processes of politicisation and identity re-­articulation through which once nationally focused groups came to include a perspective on global trade governance within their own campaigning portfolios. In Chapter 8, Felix Anderl discusses the concept of coherence and the ways it has been used in the context of international economic policy making over time. Based on a conceptual discussion of the term as an instrument of internal or external critique, he argues that different actors in the world trade regime refer to very different sets of problems when they publicly employ the term coherence. The WTO Secretariat, business actors, and governments of industrialised states  primarily refer to a narrow concept of coherence that serves to integrate prevailing discourses around trade. Advocacy groups and some governments of developing countries, in contrast, use a more expansive definition of coherence to highlight the externalities trade policies have for other policy goals like development, environmental protection, health or human rights. While Anderl identifies a progressive potential in the focus on trade’s coherence with other public goods, his chapter shows that the dominant understanding is narrow and hence

Terms of trade: introduction   17 conservative. Hinting at the dynamic nature of political discourse, he thus proposes that activists ought to continue their campaign for a broader concept of coherence. In Chapter 9, Clara Weinhardt and Angela Geck examine how the common understanding of development has changed within the world trade system over time. The chapter maps key competing arguments and narratives within the discourse related to the term ‘development’ in the world trade regime and their evolution over time. The authors present two key arguments. First, they maintain that the turn in economic development theory from dependency theory to neoliberalism delegitimised developing countries’ demands for special treatment in terms of both special protection and preferential market access. Second, the increasing contestation of who belongs to the group of developing countries made it more difficult for many countries to claim the special rights that the world trading system guarantees to developing countries. In Chapter 10, Emily Lydgate discusses the use of the concept of environment in the world trade regime. Approaching the issue as a legal scholar, the author highlights the role of language in international law, for instance when governments employ the inherent ambivalence of concepts to maintain flexibility and reach tacit agreement on contentious issues. This functionality of ambivalence might be particularly relevant in the post-­1995 context of a highly legalistic world trade regime. Substantively, the chapter shows that pressures from Member States as well as from civil society have led the WTO to recognise environmental concerns as integral to the WTO’s activities. While this has led to formal inclusion of the environment and sustainable development on the negotiating agenda, the overriding goal of WTO engagement with environmental problems is to identify areas in which trade liberalisation can further environmental goals. This approach is not surprising given the overall aims of the WTO. Yet it circumscribes the extent to which the organisation responds to environmental problems. Rather than confronting conflicts between trade and environment head-­on, environmental problem-­solving becomes an epiphenomenon in the world trade regime. In Chapter 11, Clara Brandi discusses different notions of justice and assesses empirically how actors refer to the term in the context of the world trading system. Based on an analysis of statements made by representatives of GATT/ WTO member states, the chapter argues that justice-­based demands in the trade regime have become less ambitious over time, mostly at the expense of the needs and concerns of the weakest members of the system. Taken together, the chapters display the diverse ways in which language has shaped world trade politics. Looking at the world around us, it is easy to see how these ways continue to be central. On the one hand, a global ‘trade war’ is on the agenda again, with the US Government imposing tariffs on imports from steel and aluminium and announcing protective measures that target China specifically. Public justifications – be they ‘national security concerns’, allegedly ‘unfair trade practices’ or the labelling of Chinese breaches of intellectual property rights as acts of ‘aggression’ – are part and parcel of these recent disputes in

18   Klaus Dingwerth and Clara Weinhardt world trade politics. This shows how global power shifts are negotiated not only at the level of trade policy rules, but also at the level of trade policy discourse where actors seek to legitimise their positions in front of diverse constituencies. On the other hand, we see a rise of populism that comes with a proliferation of simple narratives of ‘us’ – the nation, the people – versus ‘them’ – the elites, foreign countries, migrants. In the realm of trade, this has led to the prominence of economic nationalist voices that promise to ‘put their country first’ and ‘ignore the World Trade Organization’. In view of such challenges, the liberals who have built, promoted and defended the world trade regime as we know it are searching for an equally simple and powerful answer. Whatever their response will be, the language trade policy actors employ will inevitably render some futures more imaginable, more plausible, and more desirable than others and hence prepare the paths societies will eventually embark on. This makes it all the more important to unpack the ‘terms of trade’ and examine the language of world trade politics more closely.

Notes 1 Quotes are taken from the summary records of speeches or from full transcripts of speeches made at GATT Contracting Parties meetings between 1978 and 1989 (GATT Document No. SR.34/2, p.  21; SR.34/3, p.  43; SR.42/ST/3, p.  2; SR.42/ST/13, p.  1; SR.45/ST/9, p. 2; SR.45/ST/16, p. 2; and SR.42/ST/14, p. 2; all emphases added). 2 For the sake of simplicity, we use ‘terms’ and ‘concepts’ interchangeably in the context of this book; this approach contrasts with the existing literature that introduces a distinction not only between ‘concepts’ and ‘words’, but ‘terms’ as an intermediate category (see Koselleck, 2011, p.  20). While such distinctions are analytically useful in many ways, they are less relevant for our book, notably since we accept that both ‘terms’ and ‘concepts’ – which are difficult to disentangle empirically – are central in shaping the world trading system. 3 For an exception, see Moschella and Weaver’s (2013) Handbook on Global Economic Governance, which acknowledges the importance of language to a much greater extent. Yet it remains grounded within a positivist framework that emphasises ideas merely as ‘causal factors’. Moreover, only 5 out of the 22 chapters deal explicitly with the world trade regime. 4 Note that the role of language is indirectly acknowledged in one chapter that mentions disagreement over the idea of liberalisation as a structural context factor (see chapter 26 by Elsig and Dupont) – albeit one that does not fundamentally shape the actors’ conceptualisation of the world trade regime and what it could possibly look like. As a result, limited information exchanges are seen to prevent actors from reaching an agreement (Elsig and Dupont, 2012, p. 593) – rather than the possibility that actors fail to settle on shared ‘mental maps’, including of how the economy works, that allow them to interpret information in similar ways in the first place. 5 We thank Fabian Steininger for providing input on the study of conceptual history.

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2 Trade Matthew Eagleton-­Pierce

This chapter explores three sets of struggles over the meaning and practice of ‘trade’. In doing so, it helps to mind map the relationship between changing material forms of capitalist exchange, representation through concepts, and, more precisely, the experts or figures of authority who define such meanings in particular socio-­political contexts. First, the discussion considers what could be called the classical sense of trade as the physical exchange of commodities. This intuitive meaning, with ancient roots, was the predominant sense from the early development of capitalism through to the twentieth century. Second, the discussion moves forward to explore how, from the 1980s, this original conception of trade was progressively stretched in new directions as a result of the turn towards ‘beyond the border’ regulation. Here, attention is devoted to how ‘trade’, including through the work of lawyers, became associated with services and intellectual property rules, among other key examples. From the 1990s, the meaning of trade was further reconfigured in light of labour and environmental activism, resulting in an influential framing of such (oppositional) forces under the heading of ‘trade and’. Third, the chapter evaluates the recent heightened contestation over trade policy, including arguments from both the political left and political right in the context of capitalist crises. These debates form part of a general trend towards problematising the presumed benefits of trade liberalisation. Overall, the history of the category of trade shows how it can be treated as a malleable ‘container’ into which different actors can empty their meanings, yet the privileging of certain interests over others reveals how agendas linked to the term are not neutral.

Early conceptions of international trade Debates on the meaning and practice of commercial exchange, either internally within a particular jurisdictional space or externally across territories, is a long-­ running theme in the Western tradition. Before the development of classical liberal thought by Adam Smith and his contemporaries, the understanding of trade was shaped by different moral traditions and doctrines. Two legacies of thought can be briefly highlighted here for their salience: medieval scholastic thought and natural law philosophy. In reference to the former, from the twelfth

Trade   23 to the sixteenth century, scholasticism drew upon Christian theology and Aristotelian philosophy to chart a more favourable conception of commerce when compared to early Christian beliefs. For instance, Thomas Aquinas argued that trade did not inevitably lead to fraud, greed, and failures of virtue but, rather, suggested that the moral worth of such activity depended upon the motives and conduct of each trader in question (Aquinas, 1949). Through the thirteenth and fourteenth centuries, scholastic writers who followed in the footsteps of Aquinas continued to embellish his ideas. By the Portuguese and Spanish colonial encounters from the fifteenth century or, elsewhere, in respect to the rise of city-­ states such as Florence and Venice, one can see the emergence of a more positive discourse on international trade in which one only had the potential to be corrupted and that commerce could even be viewed as an ethically neutral pursuit to which all could potentially benefit (Viner, 1991; Irwin, 1996). While the scholastics tended to focus on objective methods for studying moral behaviour from an individual perspective, the philosophers of natural law considered how the state could be organised in accordance with so-­called ‘universal’ principles. One can note here how phrases such as ‘freedom of trade’ began to be articulated and were gradually conflated with the legitimate ‘rights of nations’. In reference to the sixteenth century, for instance, Francisco de Vitoria (1557) argued that ‘freedom’ could be linked to ‘the sovereign’ and, in turn, sought to use such an association to legitimise the Spanish conquest of the Americas: ‘neither may the native princes hinder their subjects from carrying on trade with the Spanish; nor, on the other hand, may the princes of Spain prevent commerce with the natives’. Elsewhere, Hugo Grotius, the leading natural law thinker of the seventeenth century, made similar claims that the ‘right to engage in commerce pertains equally to all peoples’, and that ‘freedom of trade is based on a primitive right of nations which has a natural and a permanent cause; and that right cannot be destroyed’ (Grotius, 1983). In short, the natural law theorists were searching for arguments to justify the freedom to trade across territorial boundaries in the context of the so-­called ‘universal economy’. Yet, to underscore, the actual practices of trade relations were strongly bound up with conquest, piracy, and war. The origins of the phrase ‘free trade’ or, to be more precise, ‘a free trade’ as it was initially expressed, are difficult to locate precisely but seem to first appear in the late sixteenth century. Within this period, in the context of parliamentary debates in England, political figures, merchants, and other advisors debated how to reform royal grants which gave monopolistic rights for certain traders to engage in foreign commerce. The meaning of ‘freedom’ in such calls was not focused on the lowering of tariffs – a primary topic of attention in our contemporary age – but, rather, largely pivoted around who had privileged access to lucrative trade routes (Irwin, 1996; Heckscher, 1934). By the seventeenth century and, in particular, in the eighteenth century, the critics of mercantilist thought grew louder in their opposition. They began adopting a more consistent stance in favour of free trade, testing out ideas and propositions that would serve as sources of inspiration for Adam Smith’s key synthesis in the Wealth of

24   Matthew Eagleton-Pierce Nations (1776). For instance, the French physiocrats were famous for advancing the maxim of laissez-­faire et laissez-­passer (implying freedom to produce and freedom to trade). Although the physiocrats did not devote much analytical attention to international trade per se, they were significant for arguing that self-­ interested motives lay at the heart of many economic exchanges and that unless there was a good reason, one should not intervene in the market. In the discipline of economics, as well as international law, the case for free trade was strengthened by the nineteenth century. Although Smith furnished a classical liberal articulation for commercial exchange, it was David Ricardo (1817), along with James Mill (1821), who composed the famous mathematically­founded justification for trade through comparative advantage: the idea that mutual gains from trade can be realised when nations specialise in producing those goods in which their opportunity cost is lowest. When Paul Samuelson, a leading twentieth century economist, was asked to name one proposition in the social sciences that was both true and non-­trivial, he named ‘the Ricardian theory of comparative advantage’ (Samuelson, 1969, p. 9). From the early theorists, through to the Victorian valorisation of Smith as a liberal godfather, the popular image and professionalisation of economists has thus become closely associated with arguments that defend free trade as a quasi-­law of capitalism (Magnusson, 2004; Howe, 1997). Similar to our current debates, the legitimation of such claims has always been informed by an opposition to a ‘negative Other’: protectionism, a category which had become crystallised in a dichotomy with free trade by the mid-­nineteenth century (see Winslett, this volume). This struggle over the meaning of the notion of trade has, however, never been the sole preserve of economists and lawyers who plot dry calculations of tariff schedules and the like. Rather, within many country settings, the rhetorical and social power of the free trade argument has also been tied to wider visions of national identity, moral virtues, and the cultivation of new consumer identities (for instance, on the British case, see Trentmann, 2008). In other words, while economists and lawyers have been major meaning makers, discourses on trade have always encompassed a range of social actors. This capacity for ‘trade’ to be treated as a vessel into which social agents can enter their own interests, desires, and anxieties helps to explain its ideological dexterity. In this respect, to borrow from the philosopher Paul Ricoeur, we might suggest that arguments around the term have always displayed an ideological ‘surplus of meaning’. While the liberal tradition on commercial exchange contains a consistent ideological morphology, with certain central tenets, the discourse also remains open to multiple readings, revisions, and interpretations. Appreciating the category of trade through this perspective helps, in turn, to explain the journey of the word through recent decades, a theme to which we can now turn.

The conceptual inflation of trade Any conceptual evaluation of the notion of trade confronts the problem of what phenomenon should be included within the category. This question is not a mere

Trade   25 academic point of clarification but, at the same time, it is often intertwined with uneven struggles over the distribution of material and political resources. Historically, as noted, international trade meant the exchange of goods which one could tangibly feel or hold in the hand, from wine, spices, and clothes to cars, computers, and solar panels. In this sense, through most of the twentieth century, international trade was predominately understood through a substantialist mode of thinking. But from the 1970s, the concept of trade has been stretched and applied to other senses. This brings forward the concern for how trade rules both reflect and constitute larger trends in capitalist value creation and, with relevance to one of the themes in this book, the particular meaning makers who have a powerful voice in shaping new discourses. Such developments have often been understood through attention to ‘beyond the border’ concerns whereby ‘trade’ is used as a policy window to promote deeper regulatory agendas. For example, on  such meaning making, one can highlight here how the multilateral trade policy agenda incorporated services and intellectual property concerns into the mainstream. In respect to the former, it is interesting to note the relations between legal classifications and political interests in the history of services trade. Building on the earlier work of William Drake and Kalypso Nicolaïdis (1992), Jane Kelsey (2008) has examined how ‘trade in services’ – an alien notion in trade politics prior to the 1980s – was in part legitimised through the work of institutions such as the OECD which acted as a restricted forum and knowledge producer for developed countries to debate how services could be classified in the GATT system. The point of such enquiries is to trace how ‘trade in services’ had particular roots in the commercial interests of US, European, and Japanese corporations, but was subsequently legitimised through a ‘globalising’ process that was aided by the OECD. Andrew Lang (2009) has enriched the analysis further by showing how this ‘regime of knowledge’ in services was constructed and monitored by interested actors. In particular, he draws attention to the potential for law to ‘close’ opportunities for contestation over time through the work of objectification and officialisation. For example, Lang argues that through the legal codification of particular definitions of the GATS (such as the four ‘modes of supply’ in Article I), as well as the ongoing professional labour of statistical analysis, particular dominant meanings acquire a certain salience and have the potential ‘to reflect and embody shared ways of classifying services’ (Lang, 2009, p. 34). Thus, these types of critical enquiries try to reveal the politicisation of trade knowledge, particularly when such knowledge may appear apolitical or ‘universal’ (also see Lang, 2006 and 2007; Adler and Bernstein, 2005). In relation to intellectual property rules, when reflecting upon the GATT Uruguay Round (1986–1994) negotiations, one needs to note how the US economy was shifting into ‘knowledge’ industries and desired to further promote them internationally. As documented by Susan Sell, intellectual property rules would not have become ‘a trade issue’ without a cluster of major corporations promoting the cause, notably pharmaceutical firms and their lobbies, as well as  Hollywood studios (Motion Picture Association of America) and industry

26   Matthew Eagleton-Pierce associations for music and publishing. The inclusion of intellectual property was the product of a campaign of intense lobbying by the US, supported by the European Union, Japan and other developed nations. Coercive tactics under Section 301 of the US Trade Act of 1974 played an important role in defeating competing policy positions that were championed by developing countries, most notably Korea and Brazil, but also Thailand and India. The US strategy of linking trade policy to intellectual property standards can be traced back to the entrepreneurship of senior management at Pfizer in particular who, from the early 1980s, mobilised corporations in the US and made maximising intellectual property rights a priority of national trade policy (Sell, 2003 and 2010; also see May, 2009). With an eye on mapping and understanding how meaning making is accomplished in the conceptual treatment of trade concerns, we can situate these empirical examples in light of the ‘trade linkage’ debate. For David Leebron (2002), there are two types of linkage claims commonly seen in the trading world: substantive linkage and strategic linkage. The former refers to circumstances whereby an issue is claimed to be ‘linkable’ to trade because there is some coherence between the two sets of norms governing each issue or domain. This may take the form of norms that are either congruent (that is, offering some degree of similarity) or, alternatively, conflictual. For instance, ‘trade and environment’ has often been formulated in conflictual terms; although others have preferred ‘sustainable development’ as a kind of mutual bridging norm. The latter linkage claim – strategic linkage – refers to uses within bargaining environments. Here, we are interested in how an actor may try to link an issue area where they are strong with an issue area where they are weak, often in order to improve their power or resource deficit. Strategic linkage claims are also critical to understanding how trade politics are conducted within negotiations, such as with the WTO or in preferential deals. In a more critical examination of the trade linkage debate, with implications for understanding the uneven effects of discursive configurations, Lang (2007) has argued that the common ‘trade and’ debate does not actually accomplish what it claims to do. At first glance, it appears that trade lawyers are opening up a debate to accommodate voices that may not always have been heard, such as environmentalists or trade unionists. But Lang (2007) suggests that, while lawyers have made significant efforts to engage and evaluate the critiques of these historically marginalised figures, the ‘trade and’ debate has come to ‘legitimise and naturalise precisely those concepts which it ought to be contesting’. Subsequently, he argues that when debates are organised between, on the one hand, ‘core’ or ‘self-­evident’ ‘trade values or understandings’ and, on the other hand, other ‘non-­trade values or understandings’, this does not represent an apolitical, disinterested move on the part of analysts or political agents. Rather, this very conceptual compartmentalisation often reveals how only particular opinions of what is believed to be the liberal trade project become privileged and defended (that is, assigned to the positive category of ‘trade’, rather than the negative category of ‘non-­trade’). ‘Trade values’ do not automatically appear to

Trade   27 be ‘human rights values’ or ‘environmental values’ within this discursive framing. Lang suggests that the results of this conceptual construction can have implications for those actors who critically examine the trading system and advance enquiries that may, indeed, aim to transform it to another state, rather than simply amend or complement it. In short, this analysis aims to address how potentially threatening oppositions to the trading order can be incorporated into the orthodoxy, in the process sapping critique of its most potent elements. However, no trade orthodoxy is capable of adequately pre-­empting and responding to all forms of critique. Protests, miscalculations, or mundane ignorance inevitably blur the deceptively straight lines of orthodox reason. It is with this context that we can turn to the third theme on the modern trade landscape.

The contemporary political contestability of trade When examining the last three decades of global trade regulation, there has been a notable trend towards sharper forms of public criticism, often in relation to developing countries but increasingly developed nations as well. In turn, this has caused renewed problems for how defenders of the system justify policy agendas. This pattern has tended to result in a tarnishing of the rhetoric of trade liberalisation in particular, including more vocal arguments stressing sovereignty, protectionism, and fairness. These ideas have emanated from the political left and right, and sometimes both at once on particular trade questions. From the mid-­1990s, notably within Europe and North America, trade policy took on a more politicised accent or, to be more precise, its inherent political content acquired a wider popular resonance. From 1994, with the signing of the North American Free Trade Agreement (NAFTA) and the establishment of the WTO, public debate over an expanding global trade agenda became increasingly visible within many industrialised countries, such as the US, Canada, the UK, France, Germany, the Netherlands, and South Korea. In 1999, the WTO system, notably the Secretariat and major powers, were shaken by the protests at the Seattle Ministerial when around 40,000 demonstrators registered their opposition to ‘corporate-­led globalisation’, an agenda which they viewed as derived from how international trade policy was designed and prosecuted. Such protests were part of the wider alter-­globalisation movement which featured a significant theme around making trade socially ‘fair’ and sensitive to environmental impacts (McNally, 2002; Smith, 2008). How the case for trade liberalisation has been problematised by particular civil society organisations (CSOs) and public intellectuals needs to be noted here. By doing so, we can return to how critically inclined meaning makers have reshaped the discursive space for argumentation on trade policy and, in some cases, caused difficulties for policymakers and established agendas (Tussie, 2009; Murphy, 2010; Hannah, 2014). For instance, from the late 1990s, CSOs who had a stake in trade debates, such as Oxfam, the World Wildlife Fund, and Greenpeace, sought to increase their investment in research and campaigning, generating substantial attention from public audiences. Oxfam’s Make Trade

28   Matthew Eagleton-Pierce Fair campaign, supported by the report Rigged Rules and Double Standards (Oxfam International, 2002), represents a good illustration of effective, research-­ led activism on trade politics, one which subsequently informed a number of developing country trade delegates in the WTO Doha Round and how other CSOs sought to critique trade reforms. The intervention of particular academics also helped to add legitimacy to these arguments, such as Dani Rodrik’s (1997 and 2017) case for pluralising policy pathways involving trade, particularly around the role for institutions; and Ha-­Joon Chang’s (2002) revisionist history on the high tariff levels used by Western countries at their earlier stages of development in the nineteenth and early twentieth centuries. Since the fallout from the global financial crisis in 2007–2008, popular opposition to new trade agreements has resurfaced in a number of industrialised countries, particularly in the West. This criticism has taken place against the return of ‘patrimonial capitalism’ as Thomas Piketty (2014) has expressed it, including rising intra-­country inequalities, oligarchic forms of governance, and stagnating wages within many Western societies (Milanovic, 2016). In the US, these conditions have informed (or have been cynically exploited for) political purposes in debates on trade policy. Among notable features, one can observe how partisan differences have widened since the beginning of the campaign for the 2016 presidential election. In October 2016, in the context of Donald Trump’s consistent criticism of existing US trade deals, only 29 per cent of Republicans and Republican-­leaning independents agreed that free trade agreements have been good for the US, down from 56 per cent in early 2014. On the same question, however, Democrats have remained committed to free trade agreements and, indeed, registered an increase in support to 67 per cent by April 2017 (Pew Research Center, 2017). For some, the US withdrawal from talks on the Trans-­Pacific Partnership (TPP) and the renegotiation of NAFTA has signalled how Trump governs as a populist plutocrat (Pierson, 2017). What has emerged is a stronger, nationalistic rhetoric on trade – one which is by no means radically new to US politics, as students of Hamilton can attest to – but is distinctive in its coarseness and suspicion of arrangements of ‘global governance’. In sum, these multiple and sustained forms of criticism on trade policy, emanating from both the political left and right, have tended to recalibrate how trade liberalisation has been defended by major international institutions (including the WTO, World Bank, OECD) and within economics generally. On the one hand, theorists have issued more cautious assessments regarding what precisely international trade can accomplish for countries and firms, particularly in terms of the ties between trade, growth, and poverty (Love and Lattimore, 2009; Wade, 2004). For instance, scholars have debated the use of different measurements of openness and encountered problems with evaluating causal relationships. In one prominent analysis, Francisco Rodríguez and Dani Rodrik (2000, p.  266) critiqued the econometrics underpinning some major studies, arguing that the case for the relationship between trade openness and growth was not ‘general’ and ‘unambiguous’, but most likely ‘contingent’ and ‘dependent on a host of country and external characteristics’. Other studies have revealed how the relationship

Trade   29 between domestic trade policy and poverty reduction is highly complex and case specific, making generalisation difficult (Turner et al., 2008). Such conclusions have dovetailed with a broader concern for examining how the consequences of trade policy changes are connected to factors such as industrial organisation, domestic political institutions, and the so-­called ‘sequencing of reforms’. In sum, as a normative baseline, while trade liberalisation continues to be treated in positive terms by many prominent voices in the field, such opinions are now marked by many different shades of grey, certainly when compared to the 1990s.

Conclusion This chapter has discussed how the concept of trade can be understood through three readings: (1) a focus on early historical meanings which helped to fashion a core, substantialist sense, (2) the modern ‘stretching’ of the term from the 1980s in the context of ‘beyond the border’ regulatory agendas, and (3) contemporary debates which have further politicised ideas and agendas under its name. In doing so, the debate helps to probe the links between processes of economic exchange and the changing representation of such dynamics through language. Like a kaleidoscope that radiates out shifting hues with each turn, the meaning of linguistic resources associated with ‘trade’ can be variegated and, at times, unpredictable. This is similar to other master terms of political and economic discourse. Agents with a stake in trade discourse actively produce social reality through the mundane activities of sense-­making, but they do so based on the positions they occupy in an objective space of constraints and opportunities. The cognitive tools chosen, and imposed, issue out of such social spaces (Eagleton-­Pierce, 2013). In other words, the capacity to shape the meaning of master concepts, such as ‘trade’, is never evenly distributed but, rather, some material practices are surrounded by a greater degree of social recognition than others. On this aspect, therefore, the discussion in this chapter has placed a particular emphasis on studying the knowledge producers who have been able to shift the meaning of the term. The marking of the boundaries and content of a trade ‘issue’ is, therefore, always a socio-­political construction in the making.

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30   Matthew Eagleton-Pierce Eagleton-­Pierce, M., 2013. Symbolic Power in the World Trade Organization. Oxford: Oxford University Press. Grotius, H., [1609]. The freedom of the seas, in Van Holk L.E. and Roelofsen C.G., eds. 1983. Grotius Reader: A Reader for Students of International Law and Legal History. The Hague: Asser Instituut. Hannah, E., 2014. The quest for inclusive and accountable governance: Embedded NGOs and demand driven advocacy in the international trade regime. Journal of World Trade 48 (3), 457–479. Heckscher, E., 1934. Mercantilism. London: Allen & Unwin. Howe, A., 1997. Free Trade and Liberal England, 1846–1946. Oxford: Oxford University Press. Irwin, D.G., 1996. Against the Tide: An Intellectual History of Free Trade. Princeton: Princeton University Press. Kelsey, J., 2008. Serving Whose Interests? The Political Economy of Trade in Services Agreements. Abingdon: Routledge. Lang, A.T.F., 2006. Reconstructing embedded liberalism: John Gerard Ruggie and constructivist approaches to the study of the international trade regime. Journal of International Economic Law 9 (1), 81–116. Lang, A.T.F., 2007. Reflecting on linkage: Cognitive and institutional change in the international trading system. Modern Law Review 70 (4), 523–550. Lang, A.T.F., 2009. Legal Regimes and Regimes of Knowledge: Governing Global Services Trade. LSE Law, Society and Economy working paper series, WPS 15–2009. Leebron, D., 2002. Linkage. American Journal of International Law 96 (1), 5–27. Love, P. and Lattimore, R.G., 2009. International Trade: Free, Fair, And Open? Paris: Organisation for Economic Co-­operation and Development. Magnusson, L., 2004. The Tradition of Free Trade. Abingdon: Routledge. May, C., 2009. The Global Political Economy of Intellectual Property Rights: The New Enclosures. Abingdon: Routledge. McNally, D., 2002. Another World is Possible: Globalization and Anti-­Capitalism. Winnipeg: Arbeiter Ring Pub. Milanovic, B., 2016. Global Inequality: A New Approach for the Age of Globalization. Cambridge, MA: Harvard University Press. Mill, J., 1821. Elements of Political Economy. London: Baldwin, Cradock, & Joy. Murphy, H., 2010. The Making of International Trade Policy: NGOs, Agenda-­setting and the WTO. Cheltenham: Edward Elgar. Oxfam International, 2002. Rigged Rules and Double Standards: Trade, Globalization and the Fight Against Poverty. Oxford: Oxfam International. Pew Research Center, 2017. Support for Free Trade Agreements Rebounds Modestly, but Wide Partisan Differences Remain. Pierson, P., 2017. American hybrid: Donald Trump and the strange merger of populism and plutocracy. British Journal of Sociology 68 (1), 105–119. Piketty, T., 2014. Capital in the Twenty-­First Century. Cambridge, MA: Harvard University Press. Ricardo, D., 2004 [1817]. On the Principles of Political Economy and Taxation. New York: Dover Publications. Rodríguez, F. and Rodrik, D., 2000. Trade policy and economic growth: A skeptic’s guide to the cross-­national evidence. NBER Macroeconomics Annual 15, 261–325. Rodrik, D., 1997. Has Globalization Gone Too Far? New York: Columbia University Press.

Trade   31 Rodrik, D., 2017. Straight Talk on Trade: Ideas for a Sane Economy. Princeton: Princeton University Press. Samuelson, P., 1969. The way of an economist, in P. Samuelson, ed. International Economic Relations: Proceedings of the Third Congress of the International Economic Association. London: Macmillan. Sell, S.K., 2003. Private Power, Public Law: The Globalization of Intellectual Property Rights. Cambridge: Cambridge University Press. Sell, S.K., 2010. The rise and rule of a trade-­based strategy: Historical institutionalism and the international regulation of intellectual property. Review of International Political Economy 17 (4), 762–790. Smith, A., 1993 [1776]. An Inquiry into the Nature and Causes of the Wealth of Nations. Oxford University Press. Smith, J., 2008. Social Movements for Global Democracy. Baltimore: John Hopkins University Press. Trentmann, F., 2008. Free Trade Nation: Commerce, Consumption, and Civil Society in Modern Britain. Oxford: Oxford University Press. Turner, L., Nguyen, N., and Bird, K., 2008. An Overview of Ex Ante Tools for Assessing the Impact of Trade Liberalization on the Poor. London: Overseas Development Institute. Tussie, D., ed., 2009. The Politics of Trade: The Role of Research in Trade Policy and Negotiations. Ottawa: International Development Research Centre. Viner, J., 1991. Essays on the Intellectual History of Economics, ed. Irwin, D. Princeton: Princeton University Press. Wade, R., 2004. Governing the Market: Economic Theory and the Role of Government in East Asian Industrialization. Princeton: Princeton University Press.

3 Protectionism Gary Winslett

Introduction The central contestation over the meaning of the term protectionism is less about what protectionism is and more about what exactly constitutes protectionism. Since the late nineteenth century, protectionism has generally been understood to mean a curtailment of trade designed to protect domestic businesses from foreign competition. That definition, generally speaking, is still what people mean when they use the word protectionism. That has not changed. What has changed and what has become highly contested is exactly which trade policies can accurately be labelled protectionist. In the mind maps of trade politics, the role played by the concept of protectionism is to rhetorically delineate those trade policies that are to be considered illegitimate from those deemed acceptable. It came to play that role through the combined meaning making efforts of export-­oriented businesses and government officials who sought to use the term protectionism as a criticism against those trade policies they disagreed with. Their ability to shape how this term has been understood has created a political landscape that favours, in a subtle but nevertheless powerful way, their attempts to reduce trade barriers. The key discursive dynamic surrounding the concept of protectionism is the expansion of what policies are thought of as protectionist and thus which policies international trade institutions have the authority and obligation to constrain. Protectionism has generally been thought of in terms of effect and intent. Does the policy limit trade, and is it meant to give advantage to domestic firms? Over time, as a result of successful meaning maker efforts by export-­oriented businesses, the threshold at which policies are considered to have unacceptably negative effects on trade flows has been lowered. Furthermore, exporting businesses and some government officials have come to portray a number of government measures that have plausible public policy goals as their stated objective to actually be motivated by protectionist intent. The definitional contest over the meaning of protectionism has major ramifications for which trade policies are seen as legitimate, for which political actors’ preferences get written into international trade rules, and for determining the extent to which trade rules may impinge on national sovereignty. Given that

Protectionism   33 reality, an explanation of the rhetorical arc of the term protectionism and the contestation over its definitional contours sheds a great deal of light on the shape and trajectory of global trade politics. This chapter provides that explanation. To do so, I first trace the transition in the major barriers to international trade and the expansion of what policies have been understood to be protectionist from the pre-­General Agreement on Tariffs and Trade (GATT) days to the end of the Tokyo Round. I then explain how export-­oriented businesses opposed to trade-­ limiting policies were able to portray those policies as protectionist in the Uruguay Round and use that round to construct the World Trade Organization (WTO) in such a way that it constrained the use of those policies. I also discuss civil society activists’ attempts to push back against these narratives and how government officials have participated in the social construction of protectionism. Finally, I use an examination of labelling requirements to demonstrate the contours of the political contestation over this crucial term that is at the centre of trade politics.

The meaning of protectionism Protectionism in the GATT (1947–1979) Tariffs and quotas constituted the primary trade barriers in the period before and immediately following the Second World War. Their intent and impact on trade were straightforward and clear. As US President Grover Cleveland pointed out in his 1887 State of the Union Address, along with raising government revenue, giving advantage to domestic businesses was the central point of a tariff (Cleveland, 1887). Similarly, the rhetoric of all of the participants at the 1930 International Conference for a Tariff Truce demonstrates quite clearly that they understood these measures to be intentional barriers to trade meant to protect domestic firms (see United States Department of State, 1930). These measures were meant to block trade and that is exactly what they did. Roughly half of the 25 per cent decrease in world trade during the Great Depression can be attributed to the increase in these trade barriers (Douglas, 2012). It was thus easy to label those policies protectionist. In fact, even those political actors who defended the use of these policies did not dispute that they constituted protectionism.1 Because these policies were widely associated with the counterproductive, beggar-­thy-neighbour responses to the onset of the Great Depression and thus believed to have exacerbated the Great Depression, government officials came to view protectionism as a counterproductive approach to trade that should be curtailed (see e.g. Kennedy, 1962). Over the course of six GATT rounds from 1947 to 1969, tariffs, especially those on manufactured goods, fell to a fraction of what they were in the 1930s (World Trade Organization, 1995). As tariffs receded, non-­tariff barriers such as subsidies and government procurement policies became relatively more important. The intent of these policies and their impact on trade were much less clear than had been the case with tariffs and quotas. Government procurement

34   Gary Winslett policies illustrate why.2 Governments are frequently the primary purchasers of a wide range of goods and services. Government procurement policies that favour domestic firms may act as trade barriers against foreign firms that would seek to provide those goods and services. Superficially then, such policies are discriminatory, but are they protectionist? These policies are widely understood to constitute trade barriers (Trionfetti, 2000; Arrowsmith, 2003). However, if protectionism is conceived in terms of intent, defenders of discriminatory government procurement policies argue that the intent of those policies is not to privilege domestic businesses but instead some other policy goal; the trade discrimination is incidental. For example, defenders of the United States government’s procurement policies in the defence industry favouring domestic firms argue that favouring domestic firms can help ensure security of supply as well as protect sensitive technologies and classified information (McCarl, 2011). Critics argue that these policies are simply disguised protectionism (Saltmarsh and Wayne, 2008). These same dynamics have also occurred on other non-­tariff barriers ranging from subsidies to competition policy.3 In contrast to the defenders of tariffs and quotas, when these non-­tariff barriers became the subject of trade negotiations in the Tokyo Round (1973–1979), the government officials that were the primary defenders of these policies did not rhetorically accept that they really counted as protectionist; conversely, exporting businesses that believed these policies were hurting them, as well as the governments of the states they were based in, held that these policies were just as protectionist as tariffs and quotas.4 The trajectory of this disagreement had three important implications for the term protectionism. First, it did not actually challenge the notion that protectionism was to be viewed with suspicion and that protectionism rather than liberalism bore the burden of proof. Relatedly, the defenders of these policies did not try to reclaim the label protectionist and try to modify it by saying that they were for ‘social protectionism’ or ‘legitimate protectionism’ or some other qualified version of protectionism. Instead they abandoned the label altogether. That even the defenders of policies that curtailed trade seemed to accept the idea that protectionism was to be avoided added to the strength of the term as a rhetorical device for delegitimising policies that inhibited trade. Second, because intent is so very difficult to definitively prove, by making the discourse around protectionism focus on the intent of the policy in question, it set the stage for mutual scepticism and bitter disputes later on. The defenders of a policy that curtails trade can plausibly argue that their motivation is not protectionism and that the trade curtailment is simply a side effect, yet because that trade curtailment is still very real, the opponents of that policy can plausibly claim that the curtailment is the real motivation.5 Third, it meant that the debate over protectionism would no longer be about the overall direction of trade policy but over which policies were or were not protectionist. In this way, it created a subtle but nevertheless powerful discursive context that privileged greater trade liberalisation. That discursive context aided, and was aided by, the rise of neoliberal economic thought. Both privileged commercial aims and worked to discredit

Protectionism   35 government policies that were perceived to stand in the way of those aims. Neoliberalism and the belief that non-­tariff barriers constituted protectionism, rather than a necessary and even benign component of embedded liberalism, went hand-­in-hand. The turn away by developing countries from import-­substitution industrialisation and embrace of export-­oriented growth as a result of the Latin American debt crisis and development successes of East Asian countries only further augmented this ideational background. The Uruguay Round The negotiating outcomes of the Uruguay Round and thus the rules embedded in the WTO reflected the preferences of those actors who were most successful at getting policies they disliked to be socially constructed as protectionist. Export-­ oriented businesses fought to expand the definition of protectionism and thus delegitimise policies that acted as barriers to their commercial aims. Firms across a range of industries including services, finance, and telecommunications were able to socially construct policies that inhibited their trade aims as protectionist (Braithwaite and Drahos, 2000). Businesses heavily reliant on intellectual property (IP) in particular illustrate how firms can effectively shape and expand the mind map of protectionism to promote their commercial interests. Intellectual property and protectionism IP-­intensive businesses, and especially Pfizer, IBM, and Monsanto, were highly effective meaning makers in the early stages of the Uruguay Round. They successfully sought to use the charge of protectionism, and trade policy more generally, to entrench their policy preference in international rules. In the early 1980s, they wanted an international IP-­regime that had two characteristics. First, they wanted developing states’ IP regulations to be raised to match US regulations (Devereaux et al., 2006; Drahos and Braithwaite, 2002). Patent terms should be extended; all classes of products, including pharmaceuticals, should be patentable; and the means to break these patents should be greatly circumscribed (Drahos and Braithwaite, 2002). Second, they wanted this new regime to have strong enforcement capabilities to prevent those developing countries from backsliding or ignoring their own laws whenever it was convenient (Drahos and Braithwaite, 2002). At the time, the primary international organisation for IP issues, the World Intellectual Property Organization (WIPO) had no real means of enforcement and no dispute settlement mechanism (Devereaux et al., 2006; Maskus, 2000). Also, because it only dealt with IP issues, there was no possibility of cross issue linkage (Devereaux et al., 2006). Even worse, from the perspective of these firms, was that it had a one-­country, one-­vote structure, which meant it was dominated by developing states (Sell and Prakash, 2004; Harrison, 2004). IP-­intensive firms argued that developing states’ lower IP-­standards were essentially theft of their intellectual property and amounted to piracy. They also

36   Gary Winslett argued that developing countries’ less stringent IP regulations amounted to protectionism because they assisted those domestic firms engaged in that piracy (Drahos and Braithwaite, 2002). These businesses successfully sold the causal story that intellectual property rights lead to free trade and investment and so promote economic growth (Sell and Prakash, 2004). According to them, linking IP with trade would have several advantages. First, through the US Generalized System of Preferences (GSP) and other preferential trading arrangements, it meant that there was something that could be exchanged for a country agreeing to higher IP regulations.6 Second, the single undertaking of the Uruguay Round meant that states could not pick and choose areas of the agreement to sign. It thus created cross-­issue linkage and so states that never would have countenanced more stringent IP rules in isolation could be bought off with concessions in other areas. Finally, the GATT, unlike WIPO, had a dispute settlement mechanism, albeit a relatively weak one (though it would get strengthened as part of the Uruguay Round). The industry’s lobbying efforts to place IP regulations on the Uruguay Round agenda were considerable. According to one US trade negotiator, Edmund Pratt and John Opel, the bosses of Pfizer and IBM respectively, ‘basically engineered, pushed, and cajoled the government into including IP as one of the topics for the negotiation’ (Devereaux et al., 2006, p. 53). The linkage of piracy with protectionism was highly effective at getting Western government officials to take a very hard line in favour of higher IP standards, as it made it a moral issue with many fewer shades of grey (Weissman, 1996; Harrison, 2004). The framing of lower IP protection as piracy was crucial because it was that framing that served to portray that lower protection as an illegitimate choice that profited domestic business at the expense of foreign business. It was the piracy framing that allowed lower IP protection to be constructed as protectionism. It was this framing that intellectually underpinned US Trade Representative Clayton Yuetter’s statement that he saw ‘no difference at all between stealing the patent for a product and stealing the product itself … thievery is thievery’ and his argument that developing countries’ lower IP regulations were ‘really an indefensible way to run a society. I don’t see how any nation in the world can defend piracy’ (Harrison, 2004, p. 81). IP-­intensive firms’ effectiveness as meaning makers is evidenced by the fact that the business community’s assessment of what IP-­trade policy should be, which was titled ‘Basic Framework of GATT Provisions on Intellectual Property: statement of Views of the European, Japanese, and the United States Business Communities’, became the foundation of the United States Trade Representative’s negotiating position in the Uruguay Round (Drahos and Braithwaite, 2002). Having convinced Western governments, and especially the United States, to think about IP leniency as protectionist attempts to shield pirates, IP-­intensive firms were able to embed their policy preferences in the WTO. All signatories now had to have patents that lasted 20 years. None were allowed to prohibit patents on drugs. The use of compulsory licenses was constrained.7 All states

Protectionism   37 were required to stringently enforce IP regulations. Failure to do any of these could lead to that state being taken before the WTO’s dispute settlement mechanism, which was much more robust than the GATT’s had been.8 Not only was the threshold of what counted as protectionism being lowered, but now because of the new dispute settlement mechanism crossing that threshold came with much more significant consequences. IP regulations were not the only regulations that businesses wanted to prevent from inhibiting trade. Environmental and labour regulations as well as health and safety standards also had the potential to impede businesses’ trade aims by raising their cost of production and/or inhibiting their access to new markets. Businesses would attempt to portray regulatory differences in these areas as protectionist but soon found that the civil society activists most interested in those regulations were highly motivated to oppose that definitional framing. New actors start caring about the meaning of protectionism The new rules brought about by the Tokyo Round, completed in 1979, and the Uruguay Round, completed in 1994, more significantly constrained anti-­ dumping, subsidies, countervailing duties, government procurement, safeguards, and other non-­tariff barriers.9 As a result of these new rules as well as a number of other trends, the differences between states’ domestic regulations on the environment, consumer safety, labour standards, and intellectual property became the most significant barriers to international trade.10 That made the political terrain over what constituted protectionism even more contested. At least earlier non-­tariff barriers had been almost entirely economic in nature and generally only pitted export-­oriented businesses against import-­ competing businesses. Now that a broader range of regulations were part of the trade agenda, civil society groups that had previously been uninterested in trade policy now became engaged in trade politics because trade now affected the regulations by which they were very much motivated. Thus the roster of political actors in trade widened to include environmentalists, consumer advocacy organisations, and labour activists, as well as other NGOs. Environmentalists were concerned that regulations designed to protect the environment could be invalidated by the GATT or other trade institutions if those regulations interfered with trade. They defended these standards by arguing that their purpose was not to give advantage to domestic businesses, but instead to promote a valued public policy goal. Environmentalist organisations such as the World Wide Fund for Nature and the Sierra Club strongly rejected the assertion that they were protectionist (Doyle, 1993; Wu, 1992). Consumer safety advocates also made the same kinds of arguments, asserting that because commercial discrimination was not the motivation animating the regulatory standards they promoted, those standards, even if they inhibited international trade, did not count as protectionism and thus were legitimate.11 Ecological economists Herman Daly and Robert Goodland summarised this argument best saying that ‘protecting hard won social gains from blind standards lowering competition,

38   Gary Winslett that is what we are interested in – not the protection of some inefficient entrepreneur who wants to grow mangoes in Sweden’ (Herman and Daly, as cited in Aaronson, 2001, p. 177). Conversely, businesses charged that the public policy justifications given in defence of these standards were simply fig leaves meant to mask their true protectionist intent. A US Chamber of Commerce representative argued that efforts to link trade policy to labour and human rights standards were simply veiled protectionism (Howard, 1987). When the US Consumer Product Safety Commission ordered a recall of rayon skirts made in India in 1994 and justified it by arguing that the skirts were excessively flammable, the Indian government charged that this was simply a protectionist ploy to curb an increase in textile imports (Rao, 1994). Because the disagreement between these businesses and civil society activists was over the true intent of the regulatory trade barriers, those firms and activists came to believe that the other side was not just wrong but actively duplicitous, which made finding acceptable compromises on these regulatory barriers that much more difficult. In the Uruguay Round negotiations, trade officials had hoped to split the difference between the two sides. They wanted to leave states adequate policy space to address social concerns but did not want that space to be so expansive that states could use specious public health and safety arguments to engage in protectionism. The WTO’s three-­fold test The rules created by these trade officials in the Uruguay Rounds subjected national regulations to a three-­fold test. First, if a state’s regulations matched the recommendations of a designated international non-­governmental organisation such as the International Organization for Standardization (ISO) or the World Organization for Animal Health (OIE), that regulation would automatically be considered WTO-­compliant. Second, if a state’s regulations did not match those recommendations, they had to have a scientific basis. Third, that regulation had to be the least trade restrictive means of achieving the regulatory goal. The WTO was attempting to respect states’ regulatory prerogatives but limit their ability to use regulatory means for protectionist ends. Each stage in this test had important implications for which regulatory trade barriers would be considered protectionist and delegitimised and which would be considered not to be protectionist and thus upheld. The first stage subtly shifted the terms in defining protectionism. Even though the regulations promulgated by ISO and other standards bodies are not legally binding, because they are automatically considered WTO-­compliant and thus not considered protectionist, there is still a powerful incentive to adopt those standards. In other words, the mere threat of a policy being labelled protectionist exerts a centripetal force pushing states’ regulations towards an international centre point. When observers talk about the WTO having power or influence, they often are referring to the WTO’s dispute settlement process. The dispute settlement

Protectionism   39 process receives most of the attention for understandable reasons. The most obvious way in which the WTO influences a state’s policy is when that state amends a policy after a WTO dispute such as when the United States curtailed its subsidies to cotton farmers after a dispute with Brazil. Another way to think about the WTO’s influence however is not just to think about when a state amends its policies after a dispute but also when a state adopts an ISO or Codex  or OIE standard because that is the path of least juridical resistance when  they otherwise would have implemented their own specifically national standards. The centripetal nudge that this first stage delivers is thus frequently underappreciated. It also bears pointing out that many of these international standard setting bodies give far more representation to international businesses than to non-­ business groups. For example, business controls the lion’s share of representation at Codex; the more decisions that can be made at a forum dominated by business, the more influence business has over those regulations (Braithwaite and Drahos, 2000, pp. 407–408). The power of this first stage then is subtle but it nevertheless constitutes a strong mechanism through which the WTO influences how different trade policies are understood and implemented. At first glance, the first step in the WTO’s three-­fold test appears to be an exercise in resolving coordination problems but in fact, it tilts the ideational playing field in favour of the expansive understanding of protectionism promoted by export-­ oriented businesses. The second stage creates an additional constraint on states’ regulations by implicitly asserting that regulatory differences not based on science must be motivated by a desire to give an unfair advantage to domestic firms and thus are simply disguised protectionism and not WTO-­compliant.12 Adding this stage was necessary because sometimes businesses’ complaints about veiled protectionism had considerable merit. One of the most obvious examples occurred when Japan created regulatory barriers on skis (one of the few goods in which foreign companies had a considerable domestic market share) and based their decision on the argument that Japanese snow was special (Rodger, 1986). Still, just because businesses’ complaints were sometimes justified does not mean that all regulatory differences were just veiled protectionism. The scientific justification was meant to help adjudicate between different regulatory trade barriers. This requirement nevertheless provides another centripetal force by assuming that a regulatory barrier has a protectionist intent until proven otherwise. Even when there is scientific basis for the regulatory difference, firms in other states, and their governments, may and often do contend that the scientific justification is nothing more than a fig leaf for a protectionist intent. Even with a scientific justification, the third stage places another constraint by forcing a state to use the least trade restrictive regulatory means possible. Once again, the assumption implied by that rule is that a regulation that is more trade restrictive than absolutely necessary is protectionist. This rule also limits the level of protectionist impact even if protectionist intent cannot be established. If protectionism is defined in terms of intent and impact, the second and third parts

40   Gary Winslett of this test are set up to constrain protectionism as much as possible. The root norm embodied in these rules is that protectionism is bad and must be curtailed. As I discussed earlier, the threshold at which policies are considered to have unacceptably negative effects on trade flows has been lowered. The second and third stage of the WTO’s process effectively lowered the threshold of intent as well because the norm of anti-­protectionism and the institutional backing it has as a result of these rules means that the defenders of a regulatory trade barrier bear the burden of proving that the policy they prefer is not protectionist. The meaning of protectionism and the Doha Round deadlock By the Doha Round, developing countries had become much more significant meaning makers in trade politics and thus, in contrast to the Uruguay Round, developed states were much more limited in their ability to impose their definitional preferences. Disagreements between developing and developed countries over which policies count as protectionism and thus should be curtailed, and which policies do not count as protectionism and thus should not be constrained in the name of trade liberalisation, contributed to the political deadlock at the Doha Round. Developing countries insisted, with considerable justification, that the EU and Japan’s agriculture and textile policies still greatly advantaged domestic producers and that any new multilateral deal had to reduce those protectionist policies (Kharge, 2011). US inflexibility with regard to agricultural policies only compounded the difficulties surrounding this issue. Conversely, developed countries asserted that developing countries’ regulations in four areas – investment, competition, government procurement, and trade facilitation – constituted protectionism (Gallagher, 2008). Once developed countries could not get developing countries to accept regulatory trade barrier reductions in those areas, they refused to offer further concessions on agriculture and textiles (Gallagher, 2008). Not only could the two sides not find a mutually acceptable solution to these issues, they continually disagreed over whether these policies did or did not constitute protectionism. Adding to this disagreement, developed and developing countries became deadlocked over the extent to which large emerging countries could claim the right to special and differential treatment in the same manner as other developing countries (see Weinhardt and Geck, this volume).13 The idea underlying special and differential treatment all along was that though protectionism ought to be curtailed in general, small impoverished countries could be allowed to engage in protectionism on normative grounds given their impoverishment, and in any event, their small economic size meant that their doing so did not constitute any real disruption of global trade. Larger emerging countries’ claims that they too should get to benefit from special and differential treatment was looked at askance by developed countries on both grounds. They were less impoverished than the least developed countries and so the normative case was less obvious. At the same time, their considerable and growing economic heft meant

Protectionism   41 that extending special and differential treatment to them very much would create significant disruptions in global trade. Thus, the parties’ failure to find a mutually acceptable understanding of which trade policies constitute protectionism and which countries could legitimately derogate from the normal injunctions against engaging in protectionism were core reasons why the Doha Round broke down.

New fronts of debates about protectionism and labelling standards Product versus process An additional front in the political contestation over the meaning of protectionism revolved around the precise understanding of what products were to be considered ‘like products’. One of the GATT’s foundational pillars was ‘national treatment’, the idea that a state could not treat imported and domestic goods differently. The legal language used by the GATT and later the WTO is that governments are not allowed to discriminate against ‘like products’. Just as the wrangling over the meaning of protectionism grew more contentious and more complex, so too did the fight over what exactly ‘like products’ means. The definition of like products was traditionally based on characteristics of the product and thus fairly straightforward. A shirt is a shirt. As activists became involved in trade politics they sought to reconstruct the meaning of ‘like products’ to include process rather than just product characteristics. To a human rights activist, two shirts may be the same in terms of product characteristics, but if one of those shirts is made under deplorable working conditions, those shirts are not really ‘like products’ and so a state may regulate the sale of those shirts differently. In the famous Tuna-­Dolphin case, the GATT established that, for the most part, only product-­based regulatory barriers are legal. Environmentalists believed that this decision amounted to international trade institutions running roughshod over legitimate public policies. Later however, in the Shrimp-­Turtle Case, the WTO sided with American environmentalists and the US Environmental Protection Agency in holding that states could impose regulations based on process characteristics that inhibited trade so long as those regulations were not discriminatory. Notwithstanding this decision, in other cases, especially in developing countries in regards to labour standards, exporters have still contended that process characteristics are protectionism and should be struck down.14 In this way, the contestation over the meaning of protectionism has not just grown more contentious but expanded to new fronts. Labelling standards The contested social construction of the meaning of protectionism can be seen in the use of labelling requirements and how trade actors and institutions have reacted to those requirements. Labelling requirements have long been one of the

42   Gary Winslett primary ways in which governments have attempted to protect consumers. Labelling standards also raise the costs of international commerce for businesses by forcing them to create different labels in different national markets. More significantly, national labelling standards can undermine businesses’ commercial aims in two different ways. First, it can prevent them from advertising their products as they would wish. For example, British sausage makers were prohibited by German regulations from advertising their product as sausage; instead they were forced to label their product as the far less appetising ‘pork-­filled offal tubes’ (Trebilcock and Howse, 2005, p. 203). Second, they can force business to divulge information that they would prefer to remain un-­scrutinised. An example of this is requiring producers to label goods that include genetically modified organisms. GATT and WTO panels have cited labelling standards as a preferred option because labelling requirements are presumed to be less trade restrictive than other policy measures such as sales bans. The WTO has thus accepted, at least by implication, that labelling standards are less protectionist than other trade policy measures. Activists have pushed for labelling requirements to promote consumer safety. The activists’ and the WTO’s opinion notwithstanding, businesses (with the notable exception of those seeking geographical indications) have still opposed specifically national labelling requirements and have sought to portray those labelling requirements as veiled protectionism. An aspect of the meaning-­making politics surrounding labels that is worthy of note is that despite some examples of disguised protectionism such as Japan’s ski regulation, regulatory differences related to labelling, in most cases, are promoted by activists and government officials, not by import-­competing businesses seeking an advantage. For example, many US meat suppliers, rather than support US country of origin labelling laws that Canadian suppliers argued discriminated against them, actually opposed those laws as they created more costly tracking requirements (Gerlock, 2015). If this were really nothing more than disguised protectionism, the opposite pattern should have been seen. In Japan, it has been consumer safety advocates, not businesses that have promoted that country’s stringent set of labelling requirements (Vogel, 1992; Maclachlan, 2002). In the United States, it was the consumer movement, not protection-­seeking businesses, that successfully pushed for the passage of the Fair Package and Labeling Act.15 The same could be said about labelling requirements in the 2001 US Consumer Right to Know Act (Smythe, 2014). Because import-­competing businesses are not generally engaged in lobbying in support of specifically national labelling, that leaves export-­oriented businesses as the primary meaning makers in the business community. Country of origin labelling of beef illustrates some of the dynamics discussed here. After the mad cow crisis in Europe, the EU began requiring that labels on meat packages indicate the meat’s country of origin (Birmingham Post, 2000). Consumers wanted these labels because such labels could allow them to avoid British beef, which they believed was less safe than continental beef; in response to these country of origin labels, Philip Seng, the president of the Meat Export

Protectionism   43 Federation, asserted that ‘protectionism is often disguised as animal health issues, or consumer concerns, or sanitary and phytosanitary rules or regulation of biotechnology’ (Freudmann, 1999). The same dynamic has occurred in North America. US consumer groups have demanded country-­of-origin labelling of beef; Canadian suppliers have argued that these labelling requirements discriminate against them (Chase, 2003; Qiu, 2005). Businesses have not only been opposed to these labelling requirements, they have also rejected that there is any legitimate policy motivating them. Rather they are merely protectionism by another name. Significantly, here too they have been effective meaning makers as in many instances they have convinced government officials and trade negotiators to adopt that line of reasoning as well. For example, Victor Bradley, an official at the Canadian Department of Foreign Affairs and Trade, argued that he had never ‘run across any process labelling requirements that had anything to do with consumers. They all have to do with establishing trade barriers’ (Bailey, 2002). It is plausible that some labelling regulations may have protectionist intents behind them but that is almost impossible to prove. Moreover, claims that these labelling standards are not about discriminating against foreign businesses are just as plausible. In the German sausage example above, a German regulator could easily argue that German consumers expect a product labelled ‘sausage’ to have certain characteristics and that the British product in question did not meet that standard; thus allowing that British company to advertise its product as ‘sausage’ would have amounted to state-­sanctioned false advertisement. Similarly, some officials might argue that labelling requirements related to geographical indications (GIs) are a sop to agricultural producers that merely want to increase the rents they earn from their location.16 Others can just as easily respond that GIs are one important means of protecting intellectual property and ensuring that consumers are getting the product they believe they are supposed to be receiving rather than an inferior knock-­off. Again, it is worth pointing out how far the mind map over whether these labelling standards are protectionist has shifted. If tariffs had a clear intent to discriminate against foreign businesses and had a clear impact in that regard, it is not nearly as clear the extent to which labelling standards have protectionist intent or the extent to which they harm foreign business. And yet, because they have the potential to undermine some businesses, those businesses have attempted, with some success, to portray those labelling requirements as protectionism. There is also an important distinction here that often goes unmade. Tariffs, in effect, are governments discriminating against foreign products. Country-­oforigin labels are simply governments allowing their citizens to choose whether they want to discriminate against foreign products or not. Even if one accepts that government-­based discrimination amounts to illegitimate protectionism, it does not automatically follow that citizens choosing to discriminate against foreign products also amounts to illegitimate protectionism. Should consumers not have that right? This distinction between government discrimination and

44   Gary Winslett consumer discrimination is highly important and yet it is nowhere in the mind map concerning protectionism because the most effective meaning makers, internationally oriented businesses, have had a direct incentive in papering over, if not shrouding, that distinction.

Trump, Sanders, and Brexit: is ‘what’ giving way to ‘for whom’? One of the most intriguing aspects of trade politics, and especially of the ideational contestation surrounding it, is that it is constantly evolving. An analysis of the rhetoric around protectionism simply cannot ignore the sea change that has taken place in the United States and Britain. More than any other nations, these two underwrote the post-­Second World War expansions of international trade and the global governance that went with it. They were the champions of the liberal international order. And now, via Brexit and the election of Donald Trump, they appear to be retreating from that role in favour of a more truculent, drawbridges up stance vis-­à-vis the rest of the world. At the same time, even if future elections bring the left to power in both states, the left’s growing scepticism of trade means that such a political reversal may not usher in a renewed enthusiasm for international commerce. The rising calls for trade curtailment directly relate to the preceding discussion because they suggest that the frames by which protectionism has been conceptualised may be shifting. In short, the rhetorical fight over protectionism and trade policy more generally is transitioning from being primarily about ‘what’ questions to being primarily about ‘for whom’ questions. Instead of being driven by the ideational debate over what policies promote the greatest wealth creation and what policies are acceptable burdens on commerce, the politics of protectionism may be turning into a much rawer struggle for resources as policy-­makers increasingly claim the right to use defensive trade policy instruments to protect national economic interests. Three aspects of Donald Trump’s thinking (all of which are in stark contrast to the post-­war order) are particularly relevant here. First, whereas the architects of post-­war embedded liberalism envisioned a rules-­based international system, Trump’s statements suggest that he views political economy in power-­based terms. Second, President Trump does share Carl Schmidt’s division of the world into friends and enemies, and for Trump, the friend is his electoral base and the enemies with respect to trade policy are other countries’ citizens that he sees as stealing wealth from the friends. That isn’t how free traders and small-­l liberals view the world at all. Third, it is difficult to overstate just how central zero-­sum frames are to Trump’s rhetoric. Trump’s book The Art of the Deal is not a guide of how to create win-­win scenarios, far from it. Instead, it is a celebration of Donald Trump’s ability to enrich himself at others’ expense. That is how he sees the world. It is thus no surprise that that is how he sees international trade. Not only does he hold this worldview, he also seems to be convincing his base and thus the Republican Party (the erstwhile defender of free trade in US politics) to

Protectionism   45 adopt that kind of view. He is thus currently a quite powerful meaning maker in shaping trade discourse. He is not alone. Marine Le Pen portrays globalisation and the trade that underpins it as a theft of prosperity and identity from the average Frenchman. Ditto for the AfD in Germany. Nigel Farage too depicted Brexit, the tearing asunder of Britain’s trading relations with Europe, as a successful wrenching back of power for the people and against the other (Eurocrats, foreigners, etc.). This transition from a discussion of ‘what policies are considered the best at creating wealth?’ to a battle over who deserves wealth amounts to a meaningful shift from the main trade politics argument being between ideas about how to govern markets to a much more openly tribal and nakedly zero-­sum trench war for economic advantage. Despite this potentially significant shift in the ways that trade curtailments are framed though, protectionism is still not a word that political actors want to apply to themselves, and that is telling. Trump sells his vision as putting America First. Brexiteers sell their crusade as a struggle for independence. Bernie Sanders, Jeremy Corbyn, and other leftists across the Western World frame their criticism of trade as standing up to multinational corporations. Trade opponents are not standing up and saying ‘I am a protectionist.’ That they will not do so speaks volumes about the discursive stability of that word. Even now, even after the political earthquakes of 2016, that word is an epithet.

Conclusion The concept of protectionism has been expanded over the course of the last 70 years. Whereas it once applied to policies like tariffs that clearly were intended to discriminate against foreign businesses and were successful at doing so, the effective meaning making efforts of businesses and some government officials both strengthened the power of the term protectionism as a slur and expanded which policies, up to and including labelling rules, were considered to be protectionist. This expansion was concomitant with the reduction of tariff barriers and the relative rise in importance of non-­tariff barriers, especially regulatory differences. How protectionism was socially constructed underpinned which trade policy areas, like intellectual property, became more greatly constrained as part of the construction of the WTO and how the WTO would adjudicate which regulatory differences were considered protectionist and thus illegitimate and which were acceptable. Disagreements over what constituted protectionism were central to the Doha Round and contributed to the lack of progress in that round. It also created new areas of political disagreement such as product versus process characteristics being used as the definitional framework of ‘like products’ as well as the extent to which labelling requirements were considered unfair trade barriers. The political contestation over the concept of protectionism pitted export-­ oriented businesses and government officials who wanted to constrain policies that might have a negative impact on trade against civil society activists and

46   Gary Winslett other government officials who wanted to promote some policy goal other than commercial expansion. The political fight over the definition of protectionism has thus not been a narrow, legalistic fight. Instead, it has been a political fight over the relative prioritisation of economic and non-­economic policy goals as well as the relative strength of global interconnection and national sovereignty. The language used to discuss trade politics has powerfully shaped the terrain that battle has been fought on. That language delineates what is thought of as fair and unfair, legitimate and illegitimate, possible and impossible. The expansion of the p-­word as both a concept and a cudgel, pushed by export-­oriented businesses and the government officials who side with them, has helped mark policies that would constrain those businesses as unfair, illegitimate, and legally impossible. The shifting contours of the language surrounding protectionism did not by themselves create today’s trade politics but it is nevertheless difficult to account for how that politics came to be without fully appreciating those contours.

Notes   1 See for example the response of Reed Smoot, co-­author of the infamous Smoot–Hawley Tariff, to candidate Franklin Roosevelt’s advocacy of lower tariffs (New York Times, 1932).   2 For a history of OECD negotiations over the procurement policies as they related to trade in the 1960s and 1970s, see Pomeranz (1982).   3 Subsidies are a particularly important policy tool that falls into this contested space. Some such as export subsidies clearly distort trade and are understood to be protectionist, but governments also subsidise all manner of economic activity in ways that, to any reasonable observer, are clearly intended to promote that form of economic activity rather than discourage trade or hamstring foreign firms. The rub, of course, is that there are a myriad of subsidies that both distort trade and have at least somewhat plausible justifications. In this way, the political fights over subsidies and protectionism mirror the rest of the broader ideational contestation over protectionism.   4 On the negotiations surrounding these NTBs in the Tokyo Round, see Winham (1980/81), Wolff (1980) and Meier (1980).   5 This is essentially the argument that occurred between European and Chinese officials in 2007. European officials argued that their consumer safety responses in the wake of scandals involving tainted and counterfeit imports from China were about promoting public health. Chinese officials predictably responded that this was simply an excuse to engage in protectionism (Anderlini, 2007).   6 The GSP is an American trade programme dating back to 1974 that grants developing countries additional tariff reductions on items they export to the US in order to promote poverty reduction. The European Community also introduced a GSP trading scheme in the 1970s, though at this point (1980s) the EC was generally less eager to use its GSP system as leverage to get other states to raise their level of intellectual property regulation.   7 For a state to use a compulsory licence under TRIPS, (a) that state must have attempted to obtain use on ‘reasonable commercial terms’, (b) the licence must be non-­exclusive, (c) the licence must primarily be for the domestic market, not exports and (d) adequate compensation must be given.   8 In contrast to the GATT dispute settlement, the WTO dispute settlement understanding cannot be blocked by the accused, proceeds more expeditiously, possesses a greater ability to enforce its decision by sanctioning retaliation, and has more

Protectionism   47 formalised panel proceedings. On the WTO dispute settlement procedures, see Trebilcock and Howse (2005, pp. 112–147).   9 For a review of how the WTO governs the use of these policies, see Trebilcock and Howse (2005). 10 These trends include: (1) the expansion of both international trade and state regulations, (2) increasing sophistication of traded products, (3) the growth of intra-­industry trade, (4) the increasing importance of economies of scale, capital intensity, and export orientation of business, and (5) the move away from ISI as a development model (Winslett, 2016). 11 A number of consumer and activist groups made these kinds of arguments during the Uruguay Round negotiations (Rowen, 1990). 12 This was very much intentional. During the negotiation of the Uruguay Round, USTR Clayton Yuetter argued that ‘standards that cannot be supported scientifically will properly be subject to WTO challenge. Bad science is too often just disguised protectionism’ (Yuetter, 1994). 13 For more on these disagreements and the Doha Round, see (Baldwin, 2016), Muzaka and Bishop (2015), and Narlikar (2015). 14 For what it’s worth, the International Labour Organization has disputed that the way these labour standards are usually included and implemented in trade agreements actually constitute protectionism (International Labour Organization, 2015). 15 On the consumer movement’s political engagement, see Cohen (2003, pp. 345–387). 16 On the politics of geographical indicators, see Raustiala and Munzer (2007).

References Aaronson, S., 2001. Taking Trade to the Streets: The Lost History of Public Efforts to Shape Globalization. Ann Arbor, MI: University of Michigan Press. Anderlini, J., 2007. Two sides trade accusations on politicising food safety. Financial Times, 27 November. Arrowsmith, S., 2003. Transparency in government procurement: The objectives of regulation and the boundaries of the world trade organization. Journal of World Trade 37 (2), 283–303. Bailey, R., 2002. Sticky labels: The new barrier to trade and aid. Australian Financial Review, 2 November. Baldwin, R., 2016. The World Trade Organization and the future of multilateralism. Journal of Economic Perspectives 30 (1), 95–116. Birmingham Post, 2000. Farm post: EU takes steps to pinpoint origin of beef. Birmingham Post, 20 April. Braithwaite, J. and Drahos, P., 2000. Global Business Regulation. New York: Cambridge University Press. Chase, S., 2003. U.S. Label law poses threat to beef sales. The Globe and Mail, 23 May. Cleveland, G., 1887. The great tariff message of President Cleveland, 6 December. Cohen, L., 2003. A Consumer’s Republic: The Politics of Mass Consumption in Postwar America. New York: Vintage Books. Devereaux, C., Lawrence, R., and Watkins, M., 2006. Case Studies in U.S. Trade Negotiations Making the Rules, Vol. 1. Washington, DC: Institute for International Economics. Doyle, L., 1993. Greens clash with consumers on GATT. The Independent, 23 September. Drahos, P. and Braithwaite, J., 2002. Information Feudalism: Who Owns the Knowledge Economy? New York: The New Press.

48   Gary Winslett Freudmann, A., 1999. Europeans increasingly finicky about food imports. Journal of Commerce, 19 May. Gallagher, K., 2008. Understanding developing country resistance to the Doha Round. Review of International Political Economy 15 (1), 62–85. Gerlock, G., 2015. Was that steak raised in the USA? Soon, it’ll be hard to know. National Public Radio, 17 December. Harrison, C.S., 2004. The Politics of the International Pricing of Prescription Drugs. Westport, CT: Praeger. Howard, J., 1987. A thinly veiled push for protectionism. New York Times, 31 May. International Labour Organization, 2015. Social Dimensions of Free Trade Agreements, revised edition. Geneva: ILO. Irwin, D., 2012. Trade Policy Disaster: Lessons from the 1930s. MIT Press: Cambridge. Kennedy, J.F., 1962. Special message to the Congress on foreign trade policy, 25 January. Kharge, M., 2011. Labour standards should not be used for protectionist purposes, speech by Labor and Employment Minister, 15 June. Maclachlan, P., 2002. Consumer Politics in Postwar Japan: The Institutional Boundaries of Citizen Activism. New York: Columbia University Press. Maskus, K., 2000. Intellectual Property Rights in the Global Economy. Washington, DC: Institute for International Economics. McCarl, L., 2011. Foreign competition in U.S. defense contracts: Why the U.S. government should favor domestic companies in awarding major defense procurement and acquisition contracts. Global Business and Development Law Journal 24 (1), 322–328. Meier, G., 1980. The Tokyo Round of multilateral trade negotiations and the developing countries. Cornell International Law Journal 13 (2), 247–249. Muzaka, V. and Bishop, M., 2015. Doha Stalemate: The end of trade multilateralism? Review of International Studies 41 (2), 383–406. Narlikar, A., 2015. The power of the powerless: The politics of poverty at the Doha Round. Foreign Affairs, 12 March. New York Times, 1932. Smoot assails Roosevelt; says his tariff view means ‘raw deal’ for our producers. New York Times, 15 September. Pomeranz, M., 1982. Toward a new international order in government procurement. Public Contract Law Journal 12 (2), 129–161. Qiu, L., 2015. Canadian hog farmers and Congress want to repeal a consumer labeling law. Here’s why. Tampa Bay Times, 2 July. Rao, V., 1994. India sees skirt recall as U.S. protectionism. Journal of Commerce, 16 August. Raustiala, K. and Munzer, S., 2007. The global struggle over geographical indications. European Journal of International Law 18 (2), 337–365. Repinski, G., Schult, C. and Traufetter. G., 2013. Self-­defense: Protectionism rules in EU arms industry. Der Spiegel, 9 December. Rodger, I., 1986. Japanese in flurry over ski standards protest. Financial Times, 23 September. Rowen, H., 1990. Are food imports safe? Washington Post, 31 May. Saltmarsh, M. and Wayne, L., 2009. Europeans play down U.S. setback for EADS. The International Herald Tribune, 20 June. Sell, S. and Prakash, A., 2004. Using ideas strategically: The contest between business and NGO networks in intellectual property rights. International Studies Quarterly 48 (1), 154. Smythe, E., 2014. Food is different: globalization, trade regimes and local food movements, in Deese, D., ed. Handbook of the International Political Economy of Trade. Northampton: Edward Elgar, 71–497.

Protectionism   49 Trebilcock, M. and Howse, R., 2005. The Regulation of International Trade, 3rd ed. New York: Routledge. Trionfetti, F., 2000. Discriminatory public procurement and international trade. The World Economy 23 (1), 57–76. United States Department of State, 1930. Presence of American unofficial observers at Geneva during the international conference for a tariff truce, February–March 1930 and November 1930. Papers relating to the foreign relations of the United States, 1930. Washington, DC: United States Department of State 1, 238–246. Vogel, D., 1992. Consumer protection and protectionism in Japan. Journal of Japanese Studies 18 (1), 119–154. Weissman, R., 1996. A long strange TRIPS: The pharmaceutical industry drive to harmonize global intellectual property rules, and the remaining WTO legal alternatives available to Third World countries. University of Pennsylvania Journal of International Economic Law 17, 1069–1125. Winham, G., 1980/81. The United States wine gallon concession: How the biggest chip in the Tokyo Round was negotiated. International Journal 36 (4), 851–878. Winslett, G., 2016. How regulations became the crux of trade politics. Journal of World Trade 50 (1), 47–70. Wolff, A., 1980. The larger political and economic role of the Tokyo Round. Law and Policy in International Business 12 (1), 9–13. WTO, 1995. Trading into the Future. Geneva: WTO Press. Wu, P.T., 1992. Environmental groups blast report linking of rules, protectionism hit. Journal of Commerce, 20 March. Yuetter, C., 1994. ‘Gatting’ the greens – environmentalists must live with trade. Financial Times, 20 September.

4 Foreign direct investment Lukas Linsi

Due to the growing transnationalisation of production and wealth chains, trade and foreign direct investment (FDI) activities have become intrinsically linked phenomena.1 Recent estimates suggest that intra-­firm transactions account for no less than one third of global trade flows (Maurer and Degain, 2010, p. 10), making FDI an influential determinant of global trading patterns. As a result, FDI statistics have become increasingly important pieces of information in trade negotiations as well as scholarly analyses and public debates about global trade. When being used in such contexts, FDI statistics are commonly interpreted as indicators of the volumes of capital going from one country to another to finance the establishment of new companies there. However, this corresponds to only a small part of what statisticians measure when they measure FDI. As a matter of fact, substantial shares of measured global FDI flows do not cross any physical border in a meaningful sense, nor are they directly associated with the creation of new factories (or jobs). In short, the conceptual gaps between common notions of FDI in economic discourses and the content inside the statistics that measure those transactions are pronounced. Simultaneously, statistical agencies’ ability to track capital flows between nation-­states in a globally integrated system of off-­shored finance is further complicated by daunting technical difficulties, which can lead to large measurement inaccuracies in these figures. And because not all statistical agencies handle these challenges in the same way, different agencies can be measuring different things when they measure ‘FDI’, limiting the degree to which these statistics can be compared across countries. Needless to say, the combination of these factors makes FDI statistics a problematic construct. It is no secret, for instance, that discrepancies between total reported global in- and outflows of FDI are large and persistent (although, at least theoretically, the difference should be zero) and that close to half of global FDI flows are channelled through special purpose entities (SPE) that make the identification of the function, ultimate ownership and destination of these investments virtually impossible. And yet, although many of these problems are fairly obvious and despite the repeated warnings and caveats issued by statisticians who collect this data, more often than not, FDI statistics are simply taken at face value, a ‘hard fact’ reflecting the ‘true’ levels of FDI.

Foreign direct investment   51 In this light, this chapter pursues a dual function: on the one hand, it intends to inform readers about some of the serious issues underlying FDI as a statistical unit and highlight the practical implications they may entail. On the other hand, the chapter uses these issues as an entry point to engage with deeper questions about the production of economic statistics and their significance in the world economy. Unlike other economic statistics such as inflation or debt indicators, FDI statistics on their own do not carry major distributional consequences and it is not clear that there are any ‘winners’ or ‘losers’ of a certain statistical definition of FDI. The theoretical implications thus do not so much refer to traditional political power dynamics, but to the more subtle ways through which the epistemic deliberations that create statistical indicators can affect our understanding of the world economy. In this view, the first point that the chapter wishes to highlight consists of the observation that statistical indicators do not only feed political discourses about the world economy, but that they are themselves simultaneously shaped by the latter. They are not simply neutral reflections of real economic developments, but powerful mind maps that affect what we see and how we see what we see (Hirschman and Popp-­Berman, 2014; Mügge, 2016). Second, the chapter demonstrates that statistical communities deserve greater analytical attention as a distinct type of international bureaucracy (see Brunsson and Jacobsson, 2000; Barnett and Finnemore, 2004). As the chapter illustrates, using the example of the central role played by IMF statisticians in the creation and dissemination of global standards on how to measure FDI, statisticians do not merely report objective figures. They play critical roles in international affairs as meaning makers who, through discreet but powerful ways, shape the lenses through which we see the world. Third, the chapter describes an empirical pattern, which emphasises the importance of cognitive ‘stickiness’ within discursive dynamics. While most of the other contributions to this volume conceptualise discourses as a source of change, this chapter illustrates how discursive resistance to change in the face of substantial structural transformations – a dynamic akin to Thelen, Hacker and Pierson’s (2013) concept of ‘institutional drift’ – can have equally important effects on common (mis)understandings in international economic affairs. While the theoretical concept of FDI as long-­term investments with a controlling interest has remained largely uncontested during the post-­war era, the fundamental structural changes in the nature of transnational economic transactions in the late twentieth century have led to an ever-­wider divergence between what FDI statistics are supposed to measure and what they actually do. The remainder of this chapter proceeds as follows: the first section briefly outlines how ‘FDI’, although practically existing for thousands of years, was only really discovered as an economic concept in the post-­war era. The second section presents an overview of the evolution of the key criteria advocated by the IMF to distinguish FDI from other cross-­border capital flows in statistical terms through an analysis of subsequent editions of the Balance of Payments Manual (BPM), the most authoritative guidelines for the collection of international economic statistics. The third section illustrates some of the mismatches

52   Lukas Linsi between the statistical operationalisation of FDI and the theoretical concepts that underlie it. The fourth section zooms in on additional issues of an accounting-­ technical nature. The last section concludes.

Drawing boundaries: discovering and defining FDI Economic analysts are primarily interested in a country’s in- or outflows of FDI in a given time-­period and the accumulated FDI stock.2 While these numbers are widely used in contemporary debates and even though companies operating simultaneously in several jurisdictions have existed for thousands of years (Moore and Lewis, 1998), they are in fact a relatively recent invention. As economic historians have estimated retrospectively, the type of capital flows which we would today define as FDI had already grown to fairly substantial levels during the so-­called ‘first period of globalization’ before the First World War (see Wilkins, 1981; Jones, 2005). Yet, in accordance with the observed ‘general lack of concern about the nationality of [economic] ownership’ (Jones, 2005, p. 202), they were typically not seen as substantially different from other types of cross-­border capital investments. This started to change during the First World War when warring parties began expropriating domestic assets held by foreign companies domiciled in enemy countries (Jones, 2005). But it was only in the aftermath of the Second World War that economic policymakers explicitly recognized FDI as a special type of capital flow, which they wished to track and monitor systematically (Whichard, 2005, p.  620).3 In order to collect data on FDI, the concept then first had to be operationalised as a measurable statistical unit. While the difference between ‘long-­term’ and ‘short-­term’ investments is more or less clear on theoretical grounds, the statistical implementation of the distinction proved to be (and remains until today) an issue fraught with conceptual as well as technical difficulties. Although the collection of FDI statistics is the responsibility of national governments, international organisations (in particular, the IMF and OECD) have played an important role as coordinators and standard-­setters for the collection of national balance of payments statistics. To better understand the evolution of FDI as a statistical unit over time it is therefore useful to track the changes in its definition in the IMF ’s Balance of Payments Manuals (BPM), which have decisively ‘shaped … the currently dominant [statistical] definitions of FDI’ (Bertrand, 2005, p.  597). The first edition of the Balance of Payments Manual (IMF, 1948) did little more than provide a short general definition of (outward) FDI as ‘the amount invested by [a country’s] residents in an enterprise or other commercial property abroad effectively controlled by its residents’ (IMF, 1948, p. 49 [emphasis added]). In other words, what set FDI apart from other types of cross-­border (portfolio) capital flows in the opinion of the authors of BPM1 was the notion of ‘control’; that is, the idea that FDI investors seek not merely a yield on the invested capital, but also some sort of managerial influence over the company they invest in (see Lipsey, 2001). Yet, otherwise, albeit emphasising the importance to record short- and long-­term capital flows separately, BPM1

Foreign direct investment   53 remained largely silent on the question how to differentiate the two from each other. Even though BPM1 mentions the share of a company’s voting stock held by foreign investors as a potential key indicator in these regards,4 the authors refrained from establishing one clear threshold. In contrast to more recent editions of the BPM, the statisticians in charge emphasised that the identification of ‘effective control’ was ultimately a qualitative judgement that is best decided on a case-­by-case basis. The ultimate decision was deliberately left in the competence of national statisticians. Although the definition of FDI gradually grew from a few words in BPM1 to entire chapters in later editions, the three subsequent versions of the BPM (IMF, 1950, 1961, 1977) kept to the notion that the identification of ‘FDI’ was essentially a qualitative judgement. All three editions reiterated the identification of situations in which foreign investors held more than 50 per cent of a company’s voting stock, or in which one single foreign investor held at least 25 per cent, as possible criteria that may be used as a shortcut to differentiate FDI from portfolio investment when a more in-­depth qualitative assessment of the situation was impractical. But the authors emphasised repeatedly that these were only suggestions and explicitly encouraged national statistical offices to also use their own criteria. For example, in BPM3 (IMF, 1961) it was underlined that [i]t is not important to draw clear border lines between branches, subsidiaries, and other direct investment enterprises, nor is it desirable to give a rigid definition of the concept of the direct investment enterprise. The following definition of this concept should be applied with flexibility and interpreted by each country in the manner most useful for analysing its balance of payments. In particular, the specific percentages suggested for determining whether a given enterprise is to be classified as a direct investment enterprise should be regarded as no more than rules of thumb. (IMF, 1961, p. 120 [emphasis added]) Similarly, it was explicitly acknowledged in BPM4 (IMF, 1977) that ‘[t]he establishment of a border line that will adequately serve to set direct investment capital apart from other types of capital, which may have many of the same observable characteristics, is sometimes not a simple matter’ (IMF, 1977, p. 137). The authors went to great lengths to reiterate their view that it was not desirable to impose one specific threshold: As the difference basically depends on the motives of the investor, objective criteria will not necessarily enable the balance of payments compiler to make the desired distinction in all instances.… The[se] national practices [to identify effective control], which have no doubt developed largely out of experience, are currently quite diverse; hence it would not be very helpful to single out any one percentage criterion as the most reasonable standard that could be applied by every country. (IMF, 1977, p. 138)

54   Lukas Linsi Interestingly, by the early 1990s international statisticians’ view on this key issue for the statistical operationalisation of FDI had transformed substantially. In contrast to the pragmatic bottom-­up approach advocated throughout BPM1– BPM4, the BPM’s fifth edition (IMF, 1993) adopts a markedly different approach. While the IMF had previously emphasised the role of qualitative judgements and deliberately encouraged a certain degree of national autonomy for the collection of balance of payments statistics, the approach shining through the assertive language used in BPM5 corresponds to a top-­down approach towards the harmonisation of statistical measurements, which leaves as little room for discretion as possible. With regards to FDI, instead of admitting the inherent subjectivity of the distinction between FDI and portfolio capital flows, BPM5 asserts confidently that a direct investment enterprise is defined … as an incorporated or unincorporated enterprise in which a direct investor, who is resident in another economy, owns 10 percent or more of the ordinary shares of voting power (for an incorporated enterprise) or the equivalent (for an unincorporated enterprise). (IMF, 1993, p. 86) In other words, the IMF established that, for statistical purposes, any cross-­ border investment involving at least 10 per cent ownership of a company’s voting stock is to be recorded as ‘FDI’ while investments below this threshold are to be classified as portfolio capital flows5 (henceforth referred to as the ‘10 per cent rule’).

Of apples and oranges: conceptual problems Although the 10 per cent rule is still not universally implemented today,6 it has become the dominant criterion that national statistical agencies use in order to identify FDI. The obvious advantage of having such a clear-­cut mechanical rule – as opposed to more qualitative evaluations of FDI – is that it can in principle be implemented in a straightforward fashion across nations. But it also has its drawbacks. Most importantly, the statistical unit that the rule defines does not directly correspond to the theoretical concept of FDI. In effect, as this section illustrates briefly, the statistical operationalisation of FDI lumps together such a great variety of economic transactions that it becomes indeed questionable if the resulting quantity can really be a useful indicator to inform any kind of policy debates. The first major conceptual issue of the statistical operationalisation of FDI is that it fails to distinguish between heterogeneous types of long-­term cross-­border investments that have potentially very different policy implications. For example, it makes no distinction by the source of capital. One of the key benefits commonly attributed to FDI is that it represents an exogenous ‘addition’ to a nation’s physical capital stock that ‘brings in money’ from abroad. However, a

Foreign direct investment   55 substantial amount of the transactions statistically defined as FDI do not actually cross any border in a meaningful sense because they are re-­invested earnings (i.e. the profits generated by affiliates from their activities in their host economy), tax-­motivated round-­trip investments, or money that foreign companies raise on local capital markets.7 Albeit this appears to be an important distinction from a national monetary perspective, the statistical operationalisation of FDI fails to take it into account. Furthermore, foreign investors can enter a country through different modes: they can create a new company (so-­called ‘greenfield’ investments), or they can acquire an already existing firm (merges and acquisitions, or ‘brownfield’ FDI). And it is very well possible that the economic and political effects of FDI – such as its job creation effect – do depend on investors’ mode of entry. While opinions on this question are starkly divided in the current literature, the crux of the matter is that it remains very difficult to assess the opposing claims empirically since standard FDI statistics classify them as one and the same thing. The second major conceptual issue of the dominant statistical operationalisation of FDI is that they at the same time include a large number of economic transactions that are much more akin to short-­term capital flows. If it was true that measured ‘FDI’ flows are primarily the outcome of long-­term investment strategies based on ‘real’ economic developments in a host economy, then the correlations between FDI in- and outflows should be low or even negative (supposedly, investments would unambiguously increase [decrease] in situations in which the fundamental growth prospects were good [bad]) and largely immune to short-­term fluctuations in global capital markets, such as major monetary policy changes. Yet, a recent analysis by Julien Acalin and former IMF chief economist Olivier Blanchard shows that the correlation between quarterly FDI in- and outflows as well as the correlation between measured FDI flows and changes in US monetary policy is surprisingly high, leading the authors to the conclusion that ‘some of these measured FDI flows are much closer to portfolio debt flows, responding to short-­run movements … rather than to medium-­run fundamentals of the country’ (Blanchard and Acalin, 2016, p. 1). The principal reason for their finding is the existence of a very significant third category of ‘FDI’ flows: special purpose entity (SPE) FDI; that is, cross-­ border capital flows involving ownership stakes above the 10 per cent threshold that are passed through holding companies. The function of these colloquial ‘letter-­box companies’ is not to oversee any industrial activities but merely to ‘hold’ shares in other companies in order to take advantage of favourable tax provisions. To give one simplified real-­world example (based on Davies and Marks, 2016): all European operations of the US online distributor Amazon are channelled through a holding company based in Luxembourg (called Amazon Europe Holding Technologies, AEHT), which holds the exclusive rights to use Amazon’s intellectual property rights outside of the US. AEHT, in turn, licenses these rights to another Amazon subsidiary in Luxembourg (Amazon EU Sarl, AEU), which operates Amazon’s European businesses. For its right to use Amazon’s

56   Lukas Linsi intellectual property, AEU then pays very large sums of royalties to AEHT, thereby significantly reducing AEU’s declared profits (and tax bill). In this way, most of Amazon’s profits from its European business are transferred to the AEHT holding company, which is legally incorporated as a structure, which according to Luxembourg’s tax laws is required to pay no more than a minimal amount of tax. These kind of ownership structures and transactions create massive challenges for the collection of FDI statistics. The parts of profits officially declared as intra-­company transfers or re-­invested earnings by AEHT in the example above will end up being counted as inward FDI to Luxembourg although Amazon in fact undertakes almost no industrial activity there. In other words, standard FDI statistics will give a heavily distorted picture of the actual economic relationship. While SPEs are not a new phenomenon, the shares of global FDI flows that are channelled through such structures have increased very rapidly in recent years.8 Estimates from the US Bureau of Economic Affairs, for instance, suggest that the share of US FDI flows going to a SPE in the first place rose from less than 10 per cent in 1980 to as much as 50 per cent today (Ibarra-­Caton and Mataloni, 2014). To illustrate the scale of this problem, it is instructive to have a look at the uniquely detailed data on the activities of US multinational enterprises abroad, which the US Bureau of Economic Analysis (US BEA) maintains.9 Unlike other FDI datasets, the US BEA data provides information not only on figures of aggregate FDI flows from the balance of payments statistics, but also operational details of US multinational corporations (MNCs) abroad such as the geographical distribution of their declared net income, total assets, sales revenues or the number of employees. Table 4.1 draws from this dataset to show the official US outward FDI stock, the total net income and the number of employees that US MNCs declared to have in European economies in 2013 (in ranked order), and the declared net income per employee. The picture is striking. While the distribution of the net income (i.e. profits after taxes) declared by US MNCs correlates strongly with the distribution of the official FDI stock, the correlation with the distribution of employees is weak. Specifically, the FDI stock data and the reported profits suggest that the bulk of operations of US MNCs are located in the Netherlands, United Kingdom, Luxembourg, Ireland and Switzerland. However, the third row shows that in fact US MNCs employ only a small number of people in Ireland, Switzerland and Luxembourg, with much larger workforces being present in Germany, France, Italy, Spain or Russia. The calculation of declared profits per employee (see last row) further highlight these disparities: while the reported net income per employee is US$30,263 in Germany and 18,792 in France, the ratio reaches numbers beyond half a million US$ per employee in Ireland, Switzerland and the Netherlands.10 The possibility that workers in Ireland are 50 times more productive than their peers in France is rather implausible, however. It seems much more likely that the unrealistically high ratios in small tax-­haven jurisdictions are driven by

United Kingdom Germany France Netherlands Italy Spain Russia Ireland Switzerland Czech Republic Turkey Austria Norway Finland Luxembourg Belgium Denmark Greece Hungary Poland Portugal Sweden

Employees (2013)

Note All raw data from US BEA, www.bea.gov/iTable/index_MNC.cfm [accessed 1 November 2016].

147,047 105,627 90,617 64,799 19,819 10,231 9,291 7,491 4,926 3,416 3,019 2,075 1,361 1,006 891 265 N.A. N.A. N.A. N.A. N.A. N.A.

Netherlands Ireland United Kingdom Switzerland Germany Belgium France Spain Denmark Russia Austria Hungary Czech Republic Finland Turkey Greece Italy Luxembourg Norway Poland Portugal Sweden

Netherlands United Kingdom Luxembourg Ireland Switzerland Germany France Belgium Norway Spain Sweden Italy Austria Denmark Russia Poland Czech Republic Hungary Turkey Portugal Finland Greece

740,740 537,714 460,029 220,670 128,490 111,724 78,667 51,966 40,617 33,879 31,675 25,829 15,630 13,397 13,280 12,480 6,383 6,317 3,845 1,978 1,919 –584

Net income (2013) (million US$)

FDI stock (2013) (million US$)

Table 4.1  Where in Europe are the US multinationals?

1,482,300 654,900 494,400 236,900 234,300 189,900 162,400 112,300 98,000 90,200 68,000 47,200 43,300 19,600 14,200 N.A. N.A. N.A. N.A. N.A. N.A. N.A.

Ireland Switzerland Netherlands Austria United Kingdom Finland Spain Germany Russia France Czech Republic Turkey Belgium Denmark Greece Hungary Italy Luxembourg Norway Poland Portugal Sweden

940,579 661,214 620,713 63,962 61,133 51,327 39,447 30,263 21,034 18,792 15,089 13,103 N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A. N.A.

Ratio: net income/employee (US$)

58   Lukas Linsi transfer pricing structures, which heavily distort the location of profits declared by US MNCs in their financial statements. In addition to the phenomenon of transfer pricing to low-­tax jurisdictions, the complexities of holding company structures can lead to several additional complications for the collection of FDI statistics. Because SPEs are frequently used in order to make corporations’ (or individuals’) balance sheets deliberately non-­ transparent, they can not only distort the picture of the distribution of economic activities (as in the Amazon example above), but the laws of certain offshore jurisdictions that do not require companies to disclose the identity of owners mean that it is nearly impossible for statisticians to establish the ultimate origin, destination or ownership of some of the FDI flows channelled through such jurisdictions. At the same time, they can also further dilute the distinction between long-­term and short-­term investments. For example, if a company transfers money to a holding company, which it fully owns, this will be recorded as an outflow of ‘FDI’. However, it is possible that the holding company in question actually does not hold a majority position in any other company, but instead functions like an investment fund, which holds a portfolio of minority investments in a large number of companies. Ultimately, SPE structures can even make it unclear whether recorded ‘FDI’ flows actually leave the country of origin, or if they are merely used for corporate inversions or other types of ‘round-­tripping’ investments. For example, in 2013 the Russian state-­owned oil producer Rosneft acquired the Russian oil company TNK-­BP for US$55 billion; because 50 per cent of the shares of TNK-­BP were owned by a holding company incorporated in the British Virgin Islands (ultimately owned by Russian individuals), the transaction led to a very strong increase in recorded FDI outflows from as well as inflows into Russia in the same year (Nougayrède, 2016). In reality, however, these figures measured little more than the acquisition of a Russian company by another Russian company. Given recent estimates that roughly 50 per cent of global FDI flows are channelled through SPEs, this leaves us with the troubling prospect that for half of global FDI flows we do not know: (i) what the ultimate destination of the capital flow and the associated economic activities really were; (ii) if the investment involved holding a controlling interest in any other company at all; or (iii) whether it was even invested outside of the ultimate owner’s home economy.

The devil is in the details: technical measurement problems The conceptual mismatches between the theoretical and statistical unit of FDI and the growing complexity and non-­transparency of transnational company ownership structures thus pose a number of serious problems for the collection of FDI statistics that together seriously threaten to undermine their usefulness to inform policy debates. But even in an optimistic scenario, in which these problems were to be solved, the estimation of the ‘true’ (or at least internationally comparable) levels of flows and stocks of FDI faces many additional obstacles of a more ‘technical’ nature.

Foreign direct investment   59 A particularly important technical challenge is the definition of clear rules on how to calculate the net value of FDI inflows and their accumulated stock.11 In effect, attributing one single economic value to an FDI transaction involves a multitude of (to some extent necessarily arbitrary) accounting decisions, such as to determine the timing of the recording of the transaction, whether to use values before or after tax, whether or not to deduct write-­offs and capital depreciation, whether to record a transaction’s book value or to estimate its market value, etc. For the purposes of this chapter it is not necessary to treat these various dimensions of accounting techniques in much depth. But it is worth noting that despite all the sustained efforts of international organisations to standardise such practices, cross-­national differences continue to persist on a number of these issues, even among OECD member countries (see IMF and OECD, 2003). And although the impact of some of these variations on reported FDI flows may be negligible, others can have substantive impacts. While issues of valuation are relevant for figures estimating both FDI flows and stocks, they are particularly important for the latter because the aggregation of figures on historical flows can compound the effect of seemingly minor technical differences. Traditionally, the dominant valuation method that most countries used to calculate FDI stock figures was based on foreign investments’ historical cost or book value – that is, past investment flows were valued according to their price at the time that the transaction took place. However, in more recent years, the IMF and OECD have moved away from this practice towards a preference for market-­based valuation techniques.12 The goal of these techniques is to estimate the current value of a past investment by taking into account the evolution of inflation rates, exchange rate movements and stock prices over the time-­period that has elapsed since the original investment was made. While these procedures can be relatively straightforward for assets that are publicly traded, they are more complicated for those that are not, such as FDI flows going into unlisted equities. Yet, the differences among the two methods alone can lead analysts to radically different conclusions. For example, a study by Ricardo Hausmann and Federico Sturzenegger (2007) – following up on earlier work undertaken by the US BEA in the early 1990s (see Landefeld and Lawson, 1991) – argues that not only the size but even the direction of the US economy’s actual net investment position depends on the valuation method that one uses to calculate the value of its outward FDI stock. While the officially reported statistics (using historical cost valuation methods) indicate that the US net investment position had deteriorated sharply since the mid-­1990s, Hausmann and Sturzenegger show that the picture looks very differently if FDI stock data is adjusted to price increases in stock market indices over the period. Because historically US MNCs had expanded abroad long before MNCs from other countries started investing in the US at a similar scale, Hausmann and Sturzenegger argue, the book value of the US outward FDI stock vastly underestimates the US’ ‘real’ investment position. Multiplying the value of historical FDI in- and outflows by the factor by which US stock market valuations have increased since then, their results suggest that

60   Lukas Linsi the US economy might actually be a net creditor rather than a debtor. In other words, one of the most heated topics of debate in US foreign economic policy of recent years seems to be entirely contingent on the choice between two equally legitimate accounting methodologies. At the same time, the question how to value past FDI flows does not simply boil down to a binary choice of either historical cost or market value methods, since a number of ways exists to calculate each of them. As a striking recent study by Jannick Damgaard and Thomas Elkjaer (2014) illustrates, the most up to date IMF guidelines for the collection of balance of payment statistics (IMF, 2009) recommends seven different methods to estimate the value of unlisted FDI. Re-­calculating the inward FDI stock according to these seven methods with Danish data, the authors come to vastly different results regarding Denmark’s ‘real’ investment position, with figures ranging anywhere between 48 and 340 billion euro (corresponding to numbers accounting for anything between 22 and 156 per cent of Danish GDP). The measurement of FDI is thus not only plagued by difficult conceptual issues, but at the same time key FDI figures are also highly contingent upon the accounting techniques that are used in order to estimate the value of those flows.

Conclusions FDI statistics are widely used in economic policy debates, most prominently so as supposedly ‘hard’ indicators of countries’ levels of globalisation or economic attractiveness. Yet, digging just a little beneath the measurement techniques giving rise to the much-­advertised headline figures, a great variety of problematic and difficult-­to-solve issues arise: Aggregate FDI statistics reflect the sum of a great variety of different types of cross-­border flows (e.g. greenfield, M&A or SPE FDI, which can all come from abroad or be raised from local capital markets) that can have very different implications for policy. The measurements include economic activities that do not seem to correspond to the theoretical concept of FDI, such as the purchase of holiday homes or, more problematically in quantitative terms, corporate inversions and other types of SPE FDI. Simultaneously, they exclude others despite good theoretical reasons to include them, such as a substantial investment by a foreign investor that comes with a seat on the board of directors, although it falls short of the official 10 per cent ownership threshold used to identify FDI. And last but not least, statistical practices to measure and calculate the value of FDI flows vary greatly across countries, raising serious questions about their comparability. Dissecting the measurement of FDI is in this sense not dissimilar from peeling an onion: once the first layer is removed, the second comes off fairly easily, and so on; and when all they layers are gone, it seems rather unclear what we are being left with. FDI is certainly a crucial phenomenon in current economic affairs and undoubtedly does require systematic attention. But analyses of FDI are unlikely to be particularly insightful in the absence of a serious engagement with the content of the data upon which they rely. As this chapter has shown, the most

Foreign direct investment   61 commonly used aggregate figures on FDI flows and stocks are fraught with conceptual and accounting-­technical difficulties. And at the end of the day, it remains fundamentally unclear whether FDI statistics are a useful approximation to the economic phenomenon that analysts intend to scrutinise when they analyse FDI data. In practical terms, it thus seems imperative for FDI data consumers to acknowledge the difficulties surrounding the collection of FDI statistics by being clear what they ‘talk about when they talk about FDI’ (see Kerner, 2014): greenfield or M&A, FDI in general or in specific sectors, ‘new’ investments only or including the re-­invested earnings by previously established foreign enterprises, and so on. Moreover, they will need to assess critically whether the data they use is aligned with the theoretical concept they are referring to: flows or positions, including or excluding SPE FDI, book values or market values, etc. Finally, there is the challenge to make sure that the data that is compared is actually comparable by checking carefully whether the agencies assembling the data followed the same methodology when compiling them. On a theoretical level, the issues highlighted by the assessment presented here are applicable far beyond the case of FDI statistics. Similar problems are indeed inherent in nearly all economic statistics. In this sense, the broader point of the chapter is to encourage a more critical engagement with economic measurements, which acknowledges that they are not simply objective truths, but socially constructed products (see Mügge, 2016). And therefore, in order to make sense of them, questions about how statistics are being constructed and by whom should be all-­important considerations that deserve much greater attention than they have received so far.

Notes   1 For helpful comments and suggestions, I am grateful to Daniel Mügge, the editors and two anonymous reviewers. Financial support provided by the Netherlands Organisation for Scientific Research (Vidi grant 016.145.395) is gratefully acknowledged.   2 Conceptually, the FDI stock is simply a measure of the total sum of flows that has accumulated over time. The difference between the inward and outward stock is used to estimate a country’s net ‘investment position’.   3 Academic economists took even longer to distil this insight, with the pioneering studies by Charles Kindleberger, John Dunning and Stephen Hymer only appearing in the late 1950s–1960s. See Dunning (1958), Hymer (1960) and Kindleberger (1969).   4 The manual specifies that in the case of subsidiaries ‘[c]ontrol’ … should be inferred if (i) 50% or more of the voting stock is owned by residents of X, or (ii) 25% or more of the voting stock is concentrated in the hands of a single holder or organized group of holders in X, or (iii) a resident of X has in fact a controlling voice in its policies … (IMF, 1948, p. 49 [emphasis added])   5 In reality, the simultaneous embrace of the principles of a ‘fully consolidated system’ (FCS) in BPM5 (IMF, 1993), which aims to also record all indirect investments of a parent company in an unbroken chain of ownership as FDI, means that investments far below the 10 per cent threshold (in a direct relationship) are also to be recorded as FDI. For example: if a foreign parent company holds 50 per cent of the voting stock in company X, which in turn holds 50 per cent of company Y, which holds 10 per

62   Lukas Linsi

 6

 7  8

 9 10 11 12

cent of company Z, the principles of FCS define the parent company’s indirect ownership of company Z as ‘FDI’ even though it actually amounts to only (0.5*0.5*0.1=) 2.5 per cent. See Bertrand (2005, p. 613). For example, a recent OECD/IMF survey revealed that two OECD member countries (Italy and Turkey) did not use the 10 per cent rule and six further member countries used other criteria in addition to the 10 per cent threshold to determine a foreign investor’s ‘effective voice’ (a practice that is explicitly not recommended by the OECD and IMF ). See IMF and OECD (2003). The latter is especially true in host economies with advanced capital markets. The suggestive findings of Acalin and Blanchard suggest that it is not only well-­ known tax havens (such as the British Virgin Islands or the Netherlands) that serve as places of conduit of SPE FDI, but a great variety of countries including Hungary, Bulgaria, Chile, Malaysia and many others. For earlier similar exercises, see Lipsey (2001) and Kerner (2014). Unfortunately, net income is not reported for Luxembourg; but given the huge size of the reported FDI stock and the very small number of employees there, it is likely that the ratio would amount to several million US$. This is also an important issue for the estimation of many other economic indicators. See, for example, Mügge and Stellinga (2014). Survey evidence suggests that practices are still far from being harmonised, with roughly half of the sample of the surveyed countries using either method in 2002. See IMF and OECD (2003).

References Barnett, M. and Finnemore, M., 2004. Rules for the World: International Organization in Global Politics. Ithaca, London: Cornell University Press. Bertrand, A., 2005. Measuring foreign direct investment, in Statistics, Knowledge and Policy: Key Indicators to Inform Decision Making. Paris: Organization for Economic Development and Co-­Operation, 597–618. Blanchard, O. and Acalin, J., 2016. What does measured FDI actually measure? Peterson Institute for International Economics: Policy Brief PB16–17, 1–7. Brunsson, N. and Jacobsson, B., 2000. A World of Standards. Oxford: Oxford University Press. Damgaard, J. and Elkjaer, T., 2014. Foreign Direct Investment and the external wealth of nations: How important is valuation? Review of Income and Wealth 60 (2), 245–260. Davies, H. and Marks, S., 2016. Revealed: How Project Goldcrest helped Amazon avoid huge sums in tax. Guardian, 18 February. Dunning, J.H., 1958. American Investment in British Manufacturing Industry. London: Allen & Unwin. Hausmann, R. and Sturzenegger, F., 2007. The missing dark matter in the wealth of nations and its implications for global imbalances. Economic Policy 22 (51), 469–518. Hirschman, D. and Popp-­Berman, E., 2014. Do economists make policies? On the political effects of economics. Socio-­Economic Review 12 (4), 779–811. Hymer, S., 1960. The International Operations of National Firms: A Study of Direct Foreign Investment. PhD Thesis, MIT. Ibarra-­Caton, M. and Mataloni, R.J., 2014. Direct investment positions for 2013: Country and industry detail. Survey of Current Business, 1–17. IMF, 1948. Balance of Payments Manual, 1st ed. Washington, DC: International Monetary Fund.

Foreign direct investment   63 IMF, 1950. Balance of Payments Manual, 2nd ed. Washington, DC: International Monetary Fund. IMF, 1961. Balance of Payments Manual, 3rd ed. Washington, DC: International Monetary Fund. IMF, 1977. Balance of Payments Manual, 4th ed. Washington, DC: International Monetary Fund. IMF, 1993. Balance of Payments Manual, 5th ed. Washington DC: International Monetary Fund. IMF, 2009. Balance of Payments and International Investment Position Manual, 6th ed. Washington, DC: International Monetary Fund. IMF and OECD, 2003. Foreign Direct Investment Statistics: How Countries Measure FDI. Washington, DC: International Monetary Fund. Jones, G., 2005. Multinationals and Global Capitalism: From the Nineteenth to the Twenty-­First Century. Oxford: Oxford University Press. Kerner, A., 2014. What we talk about when we talk about foreign direct investment. International Studies Quarterly 58 (4), 804–815. Kindleberger, C.P., 1969. American Business Abroad: Six Lectures on Direct Investment. New Haven, CT: Yale University Press. Landefeld, S.J. and Lawson, A.M., 1991. Valuation of the U.S. net international investment position. Survey of Current Business May, 40–49. Lipsey, R.E., 2001. Foreign Direct Investment and the Operations of Multinational Firms: Concepts, History, and Data. NBER working paper no. W8665. Cambridge, MA: National Bureau of Economic Research. Maurer, A. and Degain, C., 2010. Globalization and Trade Flows: What You See Is Not What You Get! Staff working paper ERSD-­2010–12. Geneva: World Trade Organization, Economic Research and Statistics Division. Available from: www.wto.org/ english/res_e/reser_e/ersd201012_e.pdf [last accessed: 26 February 2018]. Moore, K. and Lewis, D., 1998. The first multinationals: Assyria circa 2000 B.C. Management International Review 38 (2), 95–107. Mügge, D., 2016. Studying macroeconomic indicators as powerful ideas. Journal of European Public Policy 23 (3), 410–427. Mügge, D. and Stellinga, B., 2014. The unstable core of global finance: Contingent valuation and governance of international accounting standards. Regulation & Governance 9 (1), 47–62. Nougayrède, D., 2016. Untangling the effects of ‘special purpose entities’ on global FDI. Columbia FDI Perspectives 171 Available from: http://ccsi.columbia.edu/files/2013/10/ No-171-Nougayr%C3%A8de-FINAL.pdf [last accessed: 26 February 2018]. Thelen, K., Hacker, J.S., and Pierson, P., 2013. Drift and Conversion: Hidden Faces of Institutional Change, APSA 2013 Annual Meeting Paper. Whichard, O.G., 2005. Multiple indicators for multiple uses: United States statistics on foreign direct investment, in Statistics, Knowledge and Policy: Key Indicators to Inform Decision Making. Paris: Organization for Economic Development and Co-­ Operation, 619–634. Wilkins, M., 1981. The Emergence of Multinational Enterprise: American Business Abroad from the Colonial Era to 1914. Cambridge: Harvard University Press.

5 Multilateralism Matthew Louis Bishop and Valbona Muzaka

Introduction When we speak of multilateralism in global trade we think instinctively of the WTO. Of course, the WTO – and the GATT before it – both certainly represent clear expressions of highly evolved multilateral institutions. However, trade multilateralism as a concept cannot be reduced to the WTO. Recognition of this is crucial, for three reasons. First, theoretically-­speaking, multilateralism is both a seemingly simple and – perhaps unusually – relatively uncontested concept in a general sense, yet throughout its history its application has waxed and waned and it has been applied to describe, explain and even legitimise a range of quite distinctive institutional arrangements in global governance. Second, and as a consequence, conflation of the concept with contemporary arrangements rests on an idealised caricature of the multilateralism of the past which in turn contributes to reifying – in the case of trade – the WTO. The organisation is often seen not only as a multilateral institution, or an example of a particular form of multilateralism, but it is also equated with multilateralism; as truly emblematic of it. This is problematic: it narrows our imagination and constrains our understanding of what the essence of multilateralism is, and in a more immediate sense it conceals the very real challenges that the institution faces. Third, in focusing on the apparent decline of multilateralism in today’s arena of global trade politics, critics reproduce these problematic tendencies and, in turn, obscure what is from our perspective a far graver problem: the absence of a ‘shared social purpose’ for governing global trade. In light of this, the chapter unfolds according to two broad agendas. The first half essentially substantiates the case laid out above. This involves conceptualising the notion of multilateralism, and illustrating how it has evolved over time according to real-­world changes in both global governance in general and global trade politics in particular. We then move on to probe the contemporary challenges faced by the WTO and explain how this matters for multilateral trade  governance, while arguing that the two are not reducible to each other. In  the second half of the chapter, we explain what is meant by the WTO’s ‘missing social purpose’ and why it matters for both the practice of global trade politics, and also our understanding of it. We end by reflecting on what might

Multilateralism   65 characterise a meaningful social purpose on which the institutional edifice of multilateral trade politics might be erected, how it might be nurtured, and what the realistic prospects for achieving it might be.

Trade multilateralism: past and present Multilateralism is a term that is often spoken and written about, but insufficiently conceptualised and understood. Robert Keohane (1990, p. 731) once defined it as simply ‘the practice of co-­ordinating national policies in groups of three or more states’. While small groups of countries getting together to determine collective policy may be considered ‘multilateral’, often it is not; such activity may be as much about restricting the participation of others as anything else. This tells us that focusing on numbers (i.e. form) rather than the nature of engagement between states and, increasingly, myriad other actors (i.e. content) is problematic. Consequently, there is something in the essence or spirit of multilateralism that is about more than just determining whether given institutions or bodies are, or are not, multilateral according to some pre-­defined (numerical) benchmarks. We favour a considerably more expansive definition: international institutions of all kinds are not fixed, but rather continually evolving political arrangements, and (trade) multilateralism represents, in this regard, a dynamic arena of conflict and contest, rather than the orderly and cooperative arrangement it is often made to appear (see Muzaka, 2010). In the remainder of this section of the chapter we explore this by looking at the contested nature of the practice of multilateralism and the claims made about it over time. According to John Ruggie (1992, p.  571), multilateralism is an institutional form that coordinates actors’ behaviour on the basis of certain generalised principles of conduct, regardless of either their selfish, particularistic interests or specific exigencies. In the case of trade multilateralism specifically, he contends that non-­discrimination represents the overarching generalised principle of state conduct. This famously entails both ‘indivisibility’ amongst the members of the group (it applies to all), and generates expectations of ‘diffuse reciprocity’ (a notion Ruggie borrows from Keohane, 1986) whereby members can reasonably expect roughly equivalent benefits in the aggregate and over time. What this means is that – in trade at least – while states cannot expect their interests to be served by specific elements of specific agreements on every occasion, over years and decades they should broadly benefit from their participation in multilateral agreements, such as the WTO, to a similar extent to everyone else (see Wilkinson, 2000). Yet while this helps us to understand the nature of multilateralism – rather than, again, just the form – the ways in which this is understood and practised differs in different times and places. Moreover, because institutions such as multilateralism are underpinned by principles and rules that are not clear-­cut but rather ambiguous and contested, their history is necessarily dynamic, as the principles and rules that constitute them are always subject to actors’ interpretation and, often, to reinterpretation and contestation (Hall, 2010).

66   Matthew Louis Bishop and Valbona Muzaka The principle of non-­discrimination in multilateral trade contrasts with the explicitly discriminatory dimensions of bilateral trade agreements and marks out multilateralism as something that is quite different. Put simply, the principle implies that countries do not discriminate between their trading partners; this is the Most-­Favoured Nation (MFN) principle. As early as the nineteenth century, this is what bound together the series of bilateral trade agreements between European countries and in turn facilitated a reasonably successful, peaceful ad hoc form of multilateral trade, albeit with Britain playing a hegemonic role (see Irwin, 2002). After the Second World War, the more institutionalised variant of trade multilateralism with which we are more familiar – and to which we often reduce it, even though, again, it represents but one possible form – emerged, governed by supposedly neutral international organisations. In reality, though, the GATT was replete with power politics and essentially operated to the logics and demands of powerful Western countries, with the US then effectively playing a hegemonic role (Kratochwil, 2006). When negotiators established the GATT in 1947, the non-­discrimination (i.e. MFN) principle was stated at the outset. The experience of two world wars had apparently convinced them of two things: that non-­discriminatory trade was desirable for ensuring peace, and that it should be codified and institutionalised via a system of binding, ongoing, multilateral negotiations (Irwin, 2002). Over the years, these ideas have often been criticised as representing something of a myth; for instance, Susan Strange (1985) was keen to point out that interwar protectionism and nationalism were not the causes, but rather the consequences, of the Great Depression. Be that as it may, myths frequently play a crucial function in international politics: in general, they allow us to develop collectively shared understandings of the world that make sense and facilitate dialogue even if they are predicated on questionable foundational assumptions (see Carvalho et al., 2011). In the case of the particular myth regarding protectionism, this has played a crucial discursive function in maintaining support for open borders and liberalised trade over recent decades, and particularly so during the contemporary crisis (Siles-­Brügge, 2014). Notwithstanding the very real challenges faced by multilateral trade in general, and the WTO in particular at the present juncture – something we discuss in greater detail in the next section – it is clear that ideas about the importance of free trade for sustaining peace have helped to buttress the institutional paraphernalia of international agreements in an enduring way. However, these kinds of pressures are not new: states have always sought to evade their multilateral commitments while claiming to do otherwise, and non-­ discrimination was both contentious and contested in the post-­war period, just as it is now. Under the GATT, this principle was subject to two major exceptions: first, certain preferential arrangements and customs unions/free trade areas (FTAs) were exempt from the MFN clause, as long as they freed ‘substantially all trade’ between participants, and did not subsequently put in place higher barriers to the rest of the world (Dam, 1970). This permitted the maintenance of various already-­existing systems of preferences, as well as the creation of numerous new ones: the European Economic Community (EEC) and later the

Multilateralism   67 European Union (EU) and its Single Market being the most obvious and most deeply institutionalised. Second, countries could withdraw tariff concessions made previously if they were deemed to have led to ‘serious injury’ to a domestic industry or in other emergency situations. Unsurprisingly, both the notion of ‘substantially all trade’ and ‘serious injury’ have been subject to significant debate and legal wrangling ever since. The key point to make is that throughout the life of the GATT, and, subsequently, that of the WTO, claims about diffuse reciprocity, and therefore the extent to which the system’s ‘multilateral’ credentials justifiably stand up, have masked highly skewed politics in which the benefits have rarely accrued to poorer countries. In the early days, when most tariff reductions on goods took place via deals struck first bilaterally and then passed on to the wider membership through the MFN rule, trade liberalisation occurred in specific sectors of interest to the major players: that is, those that were generally highly technologically advanced, globally integrated and in which richer countries had the most significant competitive advantage (Wilkinson, 2006). This further contributed to the effective exclusion of poorer countries as it facilitated deeper industrial integration and interdependence amongst the powerful, something that was intensified by their concomitant protectionism in sectors, such as textiles and agriculture, in which developing countries may have been able to out-­compete them (Dam, 1970; Wilkinson, 2006). Moreover, despite appeals to non-­ discrimination, plenty of other forms of protectionism existed throughout the system: an array of non-­tariff barriers (NTBs) remained possible under the GATT, either explicitly, or on account of the possibility of flexible interpretation of often-­loosely drafted regulations (see Hudec, 1990). As the GATT became more deeply institutionalised and trade rounds proliferated throughout the 1970s and 1980s, more and more waivers, exclusions and forms of discrimination were implemented, often at the behest of individual (wealthy) countries to allay their specific concerns (Baldwin, 2000). Moreover, the introduction of the Generalised System of Preferences (GSP) during the 1970s – which was supposed to improve developing countries’ terms of trade – marked a further departure from reciprocity, as it allowed industrialised countries to offer, and, when it suited them, unilaterally withdraw, non-­reciprocal, preferential tariffs to groups of developing countries. This ultimately became highly discriminatory: a small group of larger and wealthier developing countries were generally seen to have benefitted the most, and the threat of GSP withdrawal became a useful tool through which donor states could discipline their recipients, particularly those with a high level of ‘political trade dependence’ (Manger and Shadlen, 2014). More can be said about the myriad departures from indivisibility and diffused reciprocity that characterised the GATT, which is today widely – but mistakenly – held up as the emblem of a smoothly operating trade multilateralism. We do not have sufficient space to delve into this detail here, but have written about it – and offer a more complete account of the broader argument regarding the way that the multilateralism of the past is often idealised and romanticised – elsewhere (see Muzaka and Bishop, 2015).

68   Matthew Louis Bishop and Valbona Muzaka Trade principles and rules, like all rules, are never created on a clean slate. Their substance embodies values, relationships, contests and processes developed over time among a variety of actors. In this complex interaction, domestic environments play a crucial role in the kind of multilateral arrangements that are set in place among state actors. In the case of the GATT, as John Ruggie (1982) has argued, trade principles and rules were characterised by a political commitment to ‘embedded liberalism’. This reflected a compromise according to which the expansion of open trade relations were to be balanced with the (then) shared sense of the necessity and legitimacy of governmental intervention into the market for the purposes of securing domestic stability. Although the degree to which key Western governments shared this consensus varied somewhat, overall trade multilateralism and the quest for domestic stability were ‘coupled and conditioned by one another’ (Ruggie, 1982, p. 398). What this means is that, before the dawning of the neoliberal era, it was broadly taken as a given that markets had to be saved from themselves: they could and should not penetrate into every area of public life, and their deleterious effects when left unchecked – maldistribution, inequity, rent-­seeking, a tendency towards monopoly and oligopoly, wealth extraction instead of wealth creation, to name a few – had to be policed by governments that were prepared to intervene aggressively. Domestically, this implied complex and well-­funded systems of social security, public control of ‘natural monopolies’ and key strategic economic sectors, full employment as an explicit policy objective, high levels of redistribution through progressive taxation and so on, all the things we associate with the ‘post-­war consensus’ (as it was called in Britain) or Roosevelt’s ‘New Deal’ in the US. Internationally, it meant the purposeful creation of rules, mechanisms and inter-­governmental organisations and regimes that sought deliberately to institutionalise collective agreements and practices to mitigate uncertainty and engender stability. While open trade as a general objective was seen to be desirable, flows of goods, people, and, especially, money, also had to be managed if they were not to be destabilising. So, the many departures from the principle of non-­discrimination on the part of the GATT parties can be interpreted to some degree as measures through which they could ensure domestic stability and prosperity. Indeed, GATT parties enjoyed considerable autonomy to interpret and implement trade norms and rules in ways that enabled them to fulfil the political and social vision of the progressive, interventionist welfare state of the time, while also respecting the diverse ways in which this vision could be implemented (Howse, 2002). Yet this form of embedded liberalism was never as widely shared as we might suppose. The neoliberal onslaught of the 1980s decisively undermined its domestic variants, both in terms of the kinds of redistributive Keynesianism favoured in the North and the developmentalism that had been attempted during the post-­colonial era in much of the South (Girvan, 2006). However, even before this – and certainly in terms of the GATT and trade – the aggregate benefits of  embedded liberalism did not accrue to all, and certainly not equally. Not only was it the case that certain powerful states – especially the US – were less

Multilateralism   69 committed to maintaining international stability by essentially social democratic state-­market compromises than others, but southern countries often effectively bore the costs of securing stability in the North (see Ruggie, 1982; Lang, 2006). Even the benefits from the Uruguay Round of trade negotiations (1986–1994), the first in which developing countries appear as near-­equals in terms of obligations undertaken, were highly skewed. The same is true today: even the most optimistic estimates of the impact of the Doha Round – were it ever to be completed – disproportionately favour the richest countries in the world, and the handful of major emerging countries that have begun to catch up with them. It is this broader, entrenched and more fundamental breach of diffused reciprocity that still haunts trade multilateralism today, as evidenced in part by the difficulties of the Doha Round, and it is to this that we now turn.

The Doha Dodo: difficult times for the WTO In December 2013, almost 20 years since the conclusion of the Uruguay Round of trade negotiations that brought the WTO into being, and over a decade since the start of the ill-­fated Doha Round, the membership finally agreed the so-­called ‘Bali Package’. Despite their continuing inability to transcend the most contentious issues facing them, they were able to do a deal by picking the least contentious – and therefore least meaningful – issues. The incoming Director-­General, Roberto Azevêdo, was moved to claim: ‘For the first time in our history, the WTO has truly delivered … this package is a not an end – it is a beginning’ (cited in WTO, 2013). Such optimism is, however, somewhat unusual. Most observers view the contemporary multilateral trading system – as well as the broader framework of global governance – as under severe pressure. In comparison to the relative optimism of the 1990s, even the basic shared acceptance of the fundamental need for multilateral solutions to international problems appears to be, at present, decaying. The well-­documented reality is that, far from being a brilliantly conceived idea with wide-­ranging support that has just run into a few recent difficulties, the Doha Round was actually on life support for much of its history. Indeed, its very establishment was largely a misconceived sop to the developing world after the ‘Battle in Seattle’ and 9/11 (Payne, 2005). Ever since the collapse of various ministerial meetings throughout the 2000s, there has been widespread opposition from larger developing countries to a trade agreement they suspect will never offer the kind of ‘development’ that was supposed to be its hallmark. Bali itself very nearly collapsed due to, in particular, Indian resistance, and almost two decades now since the establishment of Doha in 2001 it is as far away from completion as ever. Most serious observers now expect that this will never happen, and have in turn pointed to a profound crisis of trade multilateralism. In the remainder of this section we explain the challenges facing the WTO and – in line with our broader argument that ‘trade multilateralism’ has never been perfect even though it is frequently idealised as such – we caution that it does not inherently imply the decline of the broader edifice of multilateral trade (although nor

70   Matthew Louis Bishop and Valbona Muzaka do we discount this possibility). The conventional account of multilateral decline has four main dimensions (and for a considerably more detailed version of the argument outlined here, see, again, Muzaka and Bishop, 2015). The first is the Doha stalemate itself, which collapsed spectacularly in Geneva in 2008 and, despite the Bali Package, remains mired in uncertainty. The longer this state of affairs continues, the less and less likely it becomes that new impetus will be discovered, and the more the round seems effectively moribund (Scott and Wilkinson, 2010; 2011). The dénouement of Doha is primarily a product of shifting relations of power and the increased resistance of major developing countries who believe that any agreement will be heavily skewed in favour of their richer counterparts. This has only intensified as power has shifted dramatically over the past 15 years: for example, in 2001 few realised that the Chinese economy would effectively treble in size such that it has become the second largest – and on some measures the largest – economy in the world (see Bishop, 2016). China’s unprecedented expansion and the attendant ‘rise’ of the other emerging powers, and their greater collective trade activism, has sharpened the competitive pressure felt by Western countries, and limited their willingness to give concessions to others that have quite startlingly closed a development gap that was considerably larger just a decade ago. Moreover, a number of studies over this period have emphasised the ‘shrinking gains’ from trade liberalisation anyway, and the likelihood of the relative benefits accruing to the most powerful developing countries, like China, Brazil and India (Ackerman and Gallagher, 2008; Gallagher and Wise, 2010). Developing countries as a whole are therefore understandably reticent about acquiescing to a multilateral accord that, in its present form, is of dubious value: the major emerging powers are unhappy about the extent of concessions required on their part to encourage movement by developed countries on agriculture, something which is unlikely to ever be forthcoming anyway; and their less-­powerful counterparts are worried about their exclusion from a process that is often conducted behind closed doors, and does not truly take their interests into account (Khor, 2012). As Ben Richardson (2010, p.  3) has put it, ‘the benefits of multilateral liberalisation are not big enough, not certain enough, and not targeted enough to make significant difference to the world’s poor’. If history is any guide, then, developing countries are wise to remain circumspect. The second challenge can be found in the astronomical rise in the number of bilateral and plurilateral free-­trade agreements, of which many hundreds have been signed in recent years. A special mention is owed to ‘mega’ WTO-­plus deals currently in various stages, the best known of which are the Transatlantic Trade and Investment Partnership (TTIP) and Trans-­Pacific Partnership (TPP). These agreements frequently envisage liberalisation that goes well beyond that agreed at the multilateral level – and which has also been explicitly rejected, particularly by developing countries in WTO negotiations – and reaches well inside state borders, inhibiting and influencing the regulatory competence of domestic governments. These have aroused much controversy, raising important questions about their impact on the democratic abilities of states to regulate their own

Multilateralism   71 economies, along with the asymmetrical power relations that have conditioned reciprocal agreements. One example of the latter is the Economic Partnership Agreements (EPAs) negotiated between the European Union (EU) and the African, Caribbean and Pacific (ACP) group of developing countries to bring their post-­preference relationship into so-­called ‘WTO-­compliance’ (see, inter alia, Heron, 2013; Bishop et al., 2013; Heron and Siles-­Brugge, 2012; Heron and Murray-­Evans, 2016). These kinds of agreements, and especially the ‘mega’ accords like TTIP and TPP are often characterised by outlandish claims about their putative benefits which are made by proponents as a discursive strategy to justify their necessity (De Ville and Siles-­Brügge, 2015a; 2015b). More pertinently for our agenda here, these sorts of agreements carry serious implications for the WTO, whether in terms of the challenge they may pose to existing multilaterally agreed rules, or the way trade policy is increasingly being negotiated exclusively by the powerful outside of an inclusive setting with which they have become frustrated. But such frustration stems in part from their own unwillingness to concede ground to developing countries in the Doha negotiations, thus contributing to the undermining of the WTO’s importance as the key site of trade politics, as well as its ability to subsequently play its enforcement role and ensure the wider stability of the rules-­based multilateral system (see Meunier and Morin, 2015). Put differently: we may well be seeing, as Silke Trommer (2017) puts it, a ‘return to à la carte forms of trade governance [that] benefits those with the technical and political capacity to successfully navigate the fragmented governance architecture’. This may change, of course, as many of these agreements run into sustained opposition from both civil society and antagonistic governments (see below, for more on this). The third challenge relates to problems intrinsic to the WTO itself. For example, its raison d’être – the on-­going liberalisation of substantially all trade – is increasingly difficult to realise as ever-­more countries negotiate ever-­more sensitive issues within a member-­driven architecture that precludes the secretariat staking out new (potentially heterodox) intellectual ground. As Daniel Drache (2011, p.  1) has put it, the body is ‘trapped by its existing architecture’. The Doha Round has remained in stasis not only because there are wide divergences of interests – which is true of policy debate in most international institutions – but because of the expectation that an accord can and should be achieved on the basis of the ‘single undertaking’. Many developing countries are uncomfortable with signing up to multilateral liberalisation that reaches deep into areas of national regulatory competence, and the richer countries that have traditionally pushed such agendas increasingly lack the capacity or leverage to compel them to do so. Part of the problem is that developing countries are suspicious of the liberalising credentials of the powerful: as suggested earlier, the latter have often pushed market opening in areas where they are dominant, while resisting it in areas where they might be at a competitive disadvantage. But even were they to be reconciled, many developing countries fear that trading away protections in, say, public procurement or services for greater market access in agriculture

72   Matthew Louis Bishop and Valbona Muzaka would actually lead to a relative loss overall. To overcome such resistance, the approach taken by the US and EU, in particular, has been to seek to corral others into WTO-­plus bilateral agreements. It is quite likely that this approach will have the effect of undermining rather than supporting multilateralism, whatever the ultimate destiny of specific agreements themselves. The real danger is that the kind of WTO-­plus arrangements agreed elsewhere will in time become the de facto international standard, while the WTO is downgraded to a forum where legal dispute settlement, rather than deliberation and legislation, takes place (Evenett, 2009). The final issue is that the global panorama in which all of this is occurring is changing rapidly. Before 2016, many were worried simply that progress at the multilateral level had stagnated amid a deep, enduring global economic crisis. While it is certainly true that forward momentum in achieving across-­the-board agreement on an ambitious Doha accord (beyond the Bali Package) has been limited, it is also the case that a return of the kind of protectionism that haunted the 1930s has not – or at least not yet – manifested itself (Siles-­Brügge, 2014). Some have gone as far as claiming that the broad system of liberal global governance that had been painstakingly constructed since 1945 coped reasonably well with the crisis and its subsequent fallout, even to the extent that it may have effectively prevented another Great Depression (Drezner, 2016). However, at the time of writing (early 2018), with Donald Trump in the White House and advocating a highly illiberal, reactionary agenda, fears have rapidly emerged that global liberalism is on the retreat. One of Trump’s first acts on coming to office was to sign an executive order withdrawing from the TPP. However, rather than cheering, the myriad opponents who had campaigned vociferously against what, like TTIP, is seen to be a hyper neoliberal, exclusionary, antidemocratic, environmentally destructive trade deal, this has only engendered a sense of beleaguerment. This is because denouncing a WTO-plus bilateral agreement does not necessarily represent a defence of multilateralism or a return to the values of managed globalisation and embedded liberalism. Indeed, quite the contrary: the unravelling of mega-deals could actually imply even harsher forms of self-interested, egotistical trade policy on the part of powerful countries going forward, rather than any general revitalisation of the multilateral process. Indeed, the evidence from the Trump administration’s first two years is of even greater antagonism towards international cooperation and multilateralism, as these conduits are perceived not only to have done nothing to maintain American power, but to have seriously restricted it. One could, of course, see this as little more than bombastic rhetoric. But if we consider Trump’s hostile posture towards China, the imposition of tariffs on major US trade partners, the destruction of the Iran nuclear deal, the histrionics at the G7 meeting in Canada in June 2018 where his team appeared to delight in the terrifying possibility of a trade war (see Bishop, 2018), his apparent embrace of an ever-more authoritarian Putin regime in Russia, and the wider retreat from liberal values that is evident in the rise of xenophobic populism in parts of Europe – not to mention Brexit – then such fears are, at the very least, not entirely misplaced.

Multilateralism   73 In sum, not only has trade multilateralism – and multilateralism in general – never been as tidy and coherent as is often presented in retrospect, it has always been fraught with tensions, vicious ongoing battles to define key objectives and win concessions, and characterised by messy and frequently strained compromises. Such a state of affairs is intrinsically more likely today due to the fact that far greater numbers of countries with far more diverse interests operating in a context of drastically shifting relations of power are negotiating over the most sensitive areas of domestic regulatory competence. The relatively easy gains from trade liberalisation – tariff reductions on goods – were completed, for the most part, many years ago, by fewer key members who dominated proceedings, yet this still took inordinate numbers of negotiators decades of burning the midnight oil to achieve. It is therefore unsurprising that progress is more difficult today. Moreover, simply because the WTO itself is in stasis, it does not automatically follow that this is a permanent state, nor that it could not be resolved with some decisive leadership, especially from China (Bishop and Zhang, 2016). The travails of the WTO as a body need also to be separated out analytically from the prospects for trade multilateralism: they are undeniably intimately related, but also not reducible to each other. Still, despite all of this, we do live in troubled times. It may well be that the illiberalism of the late 2010s is something of an aberration, a trough in the otherwise contested but ultimately upward trajectory of a global multilateralism that has always waxed and waned. Yet it may equally be that we are living through the beginning of a significant realignment of the global political economy away from multilateralism and towards something more nationalistic. It is too soon to tell. What we do know is that, regardless of the future that is slowly hovering into view, there has been an insidious and troubling – but broadly unidentified – set of challenges to trade multilateralism that are considerably longer in genesis. This is our focus for the remainder of the chapter.

The WTO’s missing social purpose In so far as multilateralism is seen as a changeable but durable institutional form underpinned by certain generalised principles of conduct – which, to reiterate, in the case of trade would be non-­discrimination, ‘indivisibility’ (applying to all) and ‘diffuse reciprocity’ (members expect roughly equivalent benefits in aggregate and over time) – it would be difficult to argue that the trade arrangements of the post-­war period entirely deserved the multilateral label, even if they are often painted and recognised as such. In reality, there existed significant departures in letter and spirit from the principle of non-­discrimination and the same rules definitively did not apply to all members. Moreover, if ‘indivisibility’ implies, minimally, that members were ‘in it together’, this does not square with the hierarchical, exclusionary, club nature of the post-­1945 trade system. Nor did it generate true ‘diffuse reciprocity’, because most benefits visibly accrued to key developed countries. In short, pre-­Doha trade multilateralism often scored poorly on the key principles.

74   Matthew Louis Bishop and Valbona Muzaka The ‘success’ achieved in this period came about largely because core members shared, to some degree, a commitment to couple the liberalisation of trade rules with the quest for domestic – and, in theory, international – stability as captured in Ruggie’s ‘embedded liberalism’. This not only matters in and of itself: crucially, it gave a measure of what we call ‘social purpose’ to the existence and continuous functioning of trade ‘multilateralism’, such as it was. Recent historiographical work by, for example, Eric Helleiner (2014) has shown how the builders of the Bretton Woods institutions in 1944–1945 were considerably more ambitious in terms of creating international solidarity between rich and poor than is often recognised. This only compounds the sense of concern that has accompanied the narrowing of ambition on the part of international actors regarding the possibilities of global economic coordination for public benefit. An obvious example can be found in the G20: in 2009 it was briefly hoped – and claimed by the committed multilateralists in power at the time like Barack Obama, Gordon Brown, Lula da Silva, Kevin Rudd and Angela Merkel – that it would represent the central institution in a new, post-­crisis response to global governance potentially deserving of nothing less than the term ‘Bretton Woods II’ (Helleiner, 2010). That the grandest aspirations – an entirely reinvigorated global governance architecture fit for the distinctive challenges of the twenty-­first century – were not realised is, perhaps, unsurprising. Nonetheless, the effective deterioration of the G20 as a meaningful site of global politicking certainly is both surprising and disappointing, and it bodes ill for even the most cautious recasting of multilateral forms of governance in the great many areas where it is desperately required (Payne, 2016). In short, the social purpose of trade multilateralism – and multilateralism in general – has frayed significantly and may well be hanging by a troublingly thin thread. Still, even during the post-­war period, it remained the case that the majority of the collectivity – the developing countries – either did not share in the social purpose of trade multilateralism, or bore the cost associated with ensuring domestic stability within the core, or were disadvantaged on both fronts. This was the result of a contradictory multilateral arrangement that was normatively built on the recognition of ‘equal’ state sovereignty, but in practice assigned leading roles to a nucleus of powerful states. Such contradictions have been – and remain – the source of many political conflicts within global trade politics. They have visibly manifested themselves in previous trade rounds and, without question, in the current Doha Round, within which even this emaciated version of a ‘shared social purpose’ is at risk of disappearing altogether. Not only is there a decaying belief in the importance of multilateral trade, but even were this not the case, there is little shared agreement between the principal western states, the emerging powers, and the wider developing world, on what the outcomes of global trade politics should be. Put differently: everyone has retreated into narrow forms of self-­interest in the pursuit of immediate gains rather than seeking a suite of solutions that will benefit all broadly equally over a much longer timeframe. This is not a novel problem. For years now, the emphasis within global trade politics has been for the powerful to see liberalisation and the

Multilateralism   75 aggressive opening of developing country markets as an end in itself, rather than a means to engendering development, equity, and, on that basis, shared stability. What is different now, in an era of pronounced crisis – both within the trade arena and outside it – is that the missing social purpose has crystallised at just the point where, on the one hand, it may be too difficult to rediscover it, yet, on the other, it is more desperately needed than ever. So, what might characterise a meaningful social purpose that underpins trade multilateralism? For global trade politics, non-­discrimination (the MFN principle) should not be the social purpose of trade multilateralism alone. It is not an end in itself, and only matters insofar as it helps to achieve the kind of diffuse reciprocity expected in any multilateralism worthy of the name. Moreover, a distinction needs to be drawn, once again, between discrimination and differential treatment. The two have tended to be conflated over the years, with intense battles pitched over either eliminating or narrowing the scope for deploying forms of the latter which are, in our view, perfectly justifiable and legitimate. Differential treatment is often necessary – perhaps even intrinsically so – to ensure that countries at lower levels of development are not disadvantaged as they construct infant industries. Indeed, on this reading, one could even argue that casting all forms of preferences and differential treatment as discriminatory is in itself a form of discrimination, characterised as it is by the powerful effectively working to restrict the policy space that they themselves enjoyed in the past for the ‘late developers’ that are seeking to follow them. Ha-­Joon Chang (2002) put this best when he talked of the rich ‘kicking away the ladder’ for poor countries to climb up, a trend that is in desperate need of reversal. Again, if we see trade negotiations as a means to an end, with the end being the development of the poorer members of the collectivity, then it necessarily follows that greater forms of differentiated treatment should be tolerated. Yet relatively few – primarily only the ‘Least Developed Countries’ (LDCs) – today have access to preferences, and the powerful have continually and aggressively sought to circumscribe them. This is so despite many countries – highly vulnerable small island developing states (SIDS) being an obvious example – exhibiting distinctive development challenges that require distinctive responses. This is not a tension that can ever be fully resolved, but despite the liberalisation of global trade rules, there is still a role for preferences and differential treatment and it could be managed and guided by the overall social purpose of the trade regime, if it has one and it is deployed imaginatively. Accepting ‘development for all’ as a shared social purpose would only be a starting point, which must be followed by a critical questioning of what this entails and how it can be achieved through trade multilateralism. This, in turn, may necessitate not only devising rules embedding the diffuse reciprocity and the non-­discrimination principles in ways which recognise that different countries require differentiated policy space but also opening up and safeguarding the necessary political space for democratic participation, questioning and accountability to ensure that differential treatment and policy space truly result in sustainable and human development everywhere.

76   Matthew Louis Bishop and Valbona Muzaka

Conclusion Multilateralism has long been a key concept in the world trading system. Is it a crucial part of our lexicon, and a term that is utilised continually by academics and practitioners working in trade. However, as we have suggested in this chapter, the language of multilateralism is rarely problematised, with its meaning frequently taken at face value. This is a huge problem: conventional ways of understanding it are limited by perspectives that view it – whether explicitly or implicitly – as somewhat static, and even conflate it with the WTO itself. By thinking more expansively about the diverse forms it has taken over time, and shedding light on a multilateralism of the past that was considerably more messy than is often assumed to be the case, we can avoid the pitfalls of reifying the WTO, naturalising contemporary expressions as somehow definitive or perfect, and, perhaps most importantly get a sense of the extent to which those expressions are now faced with an array of quite serious challenges. This matters: the WTO is in a deep crisis today, but this is not simply – or even – the result of poor choices or misguided policy, but rather reflects deep-­seated structural contradictions in the composition of modern trade multilateralism. In 2012, at a specially convened public forum at the WTO under the rubric ‘Is Multilateralism in Crisis?’, erstwhile Director-­General Pascal Lamy noted that ‘multilateralism is struggling in almost all spheres of global co-­operation’, and the lack of progress in the Doha Round ‘demonstrates that the WTO is not immune to the geo-­economic and geo-­political transformations of our time’ (Lamy, 2012). That the Round has limped on, from setback to setback, and despite, at times, myriad pronouncements that its dénouement implies the inevitable demise of the WTO in particular, and trade multilateralism in general, suggests that such doom-­ mongering is to some extent misplaced. We do not pretend that the challenges ranged against multilateral trade are not significant. But we outlined above what might characterise a meaningful social purpose, and in the remainder of this conclusion we reflect on what the prospects are for achieving it. If the former was perhaps an excessively optimistic account, the latter is certainly a bleaker one. It is, in all honesty, difficult to see where the purposeful leadership of the global political economy is coming from at this point in time. Multilateralism is not new; its form and nature are dynamic, depending on the distribution of power between and within states and the purpose it is meant to achieve. It is also a demanding institutional form (Ruggie, 1992). As long as members participate only to defend and promote their national interest (however that position may have been reached), trade multilateralism will always be precarious. Paradoxically, though, the very crisis in which we appear to find ourselves may well provide the impetus for some kind of meaningful questioning, and, ultimately, change. Put differently: if trade multilateralism cannot, following our argument here, get going again without discovering its social purpose, that in itself may well provoke a search for such a purpose. Far from foretelling the end of trade multilateralism, the present juncture might offer states an opportunity to move closer towards (a better version of ) it.

Multilateralism   77 This could – and we say this tentatively – be an unexpected outcome of Trumpist economic nationalism in the US and its counterparts in Europe. The kinds of mercantilism that so worry liberals and which have found their most glib expression in the rhetoric of Trump, Le Pen, Putin, the Brexiteers in the UK and so forth, are not inherently incompatible with a broadly liberal trading order. As Dani Rodrik (2016) has argued, too many mainstream economists spent much of the neoliberal era decrying perfectly legitimate forms of state (and, by implication, international) intervention and downplayed the distributional costs of free trade. On this reading, then, we contend that the entirely predictable backlash represented by the most strident forms of economic nationalism could have been averted if the kinds of embedded liberal compromises that characterised the post-­war era had been implemented to manage the market failures and inequalities that necessarily emerge from greater liberalisation and interdependence, and which have grotesquely disfigured both the global economy as a whole and individual societies. At last the sacred cows of liberalisation at all costs are being slaughtered. This may well lead to great instability, and we do not discount such a possibility. But equally, it might also ultimately lead to a substantial questioning and recasting of globalisation along more managed, democratic lines.

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Multilateralism   79 Lang, A., 2006. Reconstructing embedded liberalism: John Gerard Ruggie and constructivist approaches to the study of the international trade regime. Journal of International Economic Law 9 (1), 81–116. Manger, M.S. and Shadlen, K.C., 2014. Political trade dependence and North–South trade agreements. International Studies Quarterly 58 (1), 79–91. Meunier, S. and Morin, J.F., 2015. No agreement is an island: Negotiating TTIP in a dense regime context, in Morin, J.F., Novotná, T., Ponjaert, F. and Telò, M., eds. The Politics of Transatlantic Trade Negotiation: TTIP in a Globalized World. London: Ashgate, 173–186. Muzaka, V., 2010. Linkages, contests and overlaps in the global intellectual property rights regime. European Journal of International Relations 17 (4), 755–776. Muzaka, V. and Bishop, M.L., 2015. Doha stalemate: The end of trade multilateralism? Review of International Studies 41 (2), 383–406. Payne, A., 2005. The Global Politics of Unequal Development. Basingstoke: Palgrave. Payne, A., 2016. The Global Governance of Global Crisis: Why the G20 Summit Was Created and What We Still Need It To Do. SPERI Paper No. 17. Sheffield: Sheffield Political Economy Research Institute. Available from: http://speri.dept.shef.ac.uk/wpcontent/uploads/2015/02/Paper-17-Global-Goverance-G20-Summit.pdf (access date: 30 July 2017). Richardson, B.J., 2010. From Doha to El Dorado: The World Trade Organization, Agricultural Liberalisation and the False Promise of Free Markets. CSGR Working Papers, University of Warwick, UK. Available from: www2.warwick.ac.uk/fac/soc/pais/ people/richardson/publications/doha_to_el_dorado.pdf (access date: 30 July 2017). Rodrik, D., 2016. Straight talk on trade. Project Syndicate, 15 November. Available from: www.project-syndicate.org/commentary/trump-win-economists-responsible-by-danirodrik-2016-11 (access date: 30 July 2017). Ruggie, J., 1982. International regimes, transactions, and change: Embedded liberalism in the postwar economic order. International Organization 36 (2), 379–415. Ruggie, J., 1992. Multilateralism: The anatomy of an institution. International Organization 46 (3), 561–598. Scott, J. and Wilkinson, R., 2010. What happened to Doha in Geneva? Re-­engineering the WTO’s image while missing key opportunities. European Journal of Development Research 22 (2), 141–153. Scott, J. and Wilkinson, R., 2011. The poverty of the Doha Round and the least developed countries. Third World Quarterly 32 (4), 611–627. Siles-­Brügge, G., 2014. Explaining the resilience of free trade: The Smoot–Hawley myth and the crisis. Review of International Political Economy 21 (3), 535–574. Strange, S., 1985. Protectionism and world politics. International Organization 39 (2), 233–259. Trommer, S., 2017. The WTO in an era of preferential trade agreements: Thick and thin institutions in global trade governance. World Trade Review. FirstView. Wilkinson, R., 2000. Multilateralism and the World Trade Organization. London: Routledge. WTO, 2013. Ninth WTO Ministerial Conference – Days 3, 4, and 5: Round-­the-clock Consultations Produce ‘Bali Package’, news item, 5–7 December. Geneva: World Trade Organization. Available from: www.wto.org/english/news_e/news13_e/mc9sum _07dec13_e.htm#dg (access date: 30 July 2017).

6 Democracy Klaus Dingwerth

Introduction At the protests that accompanied the 1999 Ministerial Conference of the World Trade Organization (WTO) in Seattle, demonstrators carried an oversized banner that was to become a representative symbol for the alter-­globalisation movement. It comprised two bold arrows pointing in opposite directions. One arrow had written ‘WTO’ on it, the other ‘democracy’. The message was simple but powerful: the WTO and democracy were antagonistic. You could not have both at the same time. That people could evaluate the world trade regime in terms of its ‘democratic’ credentials will have seemed odd to many trade policy practitioners back in the early 1990s. Was not the success or failure of trade policy to be measured in terms of its success in taming governments’ appetite for protectionist measures? In the institution’s contribution to growth, employment and welfare? Or, if appeal to a more abstract ideal had to be made, in the extent to which it helped to realise ‘freedom’? Yet popular demands that the world trade regime ought not to undermine democracy remained strong, leaving the trade policy community with few other options than to face the challenge. The arrows painted on the Seattle banner could thus still be seen at public protest events for some years. Cartoons, themselves a powerful tool of the alter-­globalisation movement, spelled out the suspicion behind the message on the banner, for example when they showed a bulldozer blazing a trail through the letters that form the word ‘democracy’, followed by trucks carrying the logos of well-­known multinational corporations and paving the road that, a nearby road sign informs the viewer, leads to ‘corporate rule’.1 And last, but not least, the more recent opposition to the Transatlantic Trade and Investment Partnership (TTIP) has brought the argument that free trade and democracy do not go together back on the front pages. Set in this broader context, I use this chapter to develop three broad arguments. First, I argue that democratic legitimation claims have entered the GATT and WTO discourse only relatively recently and under very specific circumstances. Yet when they became part of the legitimation discourse, democratic frames could build on discursive links with normative frames that had been around for a while, notably the notion of ‘consensus’ and developing countries’

Democracy   81 calls for ‘full participation’ in multilateral trade negotiations. In important ways, the seeds for democratic frames had thus already been planted in earlier decades, and the mind map for public evaluations of the world trade regime changed gradually rather than abruptly. Second, I show that once the democratic frame had gained prominence in the highly visible Seattle protests, the WTO consciously adopted it and – in many ways successfully – re-­defined its core content so that what counted as ‘democratic’ came to match the organisation’s practices. Arguing that its voting rules, its consensus-­based decision-­making culture, and its practice of making a wealth of documents available to the public made it the ‘most democratic’ of all international economic organizations, WTO officials thus became important meaning makers in the discursive contest for legitimacy. Third, I maintain that the role of democratic legitimation claims not only increased with protests against the GATT and WTO, but that its relevance also decreased – at least in official WTO communications and media debates – once public opposition against the WTO weakened. Nonetheless, the addition of the democratic frame after Seattle proved consequential. It has led the WTO to explicitly link its democratic quality to the consensus norm, thereby strengthening a growing WTO – now with 162 members – against pressures to weaken the consensus norm in the face of the current deadlock of the Doha Round.

A changing mind map and the WTO as a meaning maker: the rise and fall of democratic legitimation frames A brief look at the reports of GATT Contracting Parties meetings during the Tokyo and Uruguay rounds of multilateral trade negotiations as well as the WTO Ministerial Conferences during the Doha Round is insightful. During the Tokyo Round (1973–1979), member states use the term ‘democratic’ only once, namely when, in a 1974 meeting of GATT members, the Romanian delegate, a certain Mr. Petrescou, demands that the multilateral trade negotiations … and more generally the conduct of governments in their trade relations should aim at a democratic renewal of international trade, assuring the elimination of obstacles to free and non-­ discriminatory exchange of goods and the granting of preferential treatment for developing countries. (GATT, 1974, p. 30) Referring to the need to put world trade on a more equal footing, the Romanian delegate invokes the phrase of a ‘democratic renewal of international trade’ only six months after the UN General Assembly adopted its landmark Declaration on the Establishment of a New International Economic Order (NIEO). Like the declaration, however, it failed to make a sustained impression. In the Uruguay Round (1986–1994), the democratic legitimation frame thus does not play a major role either. It appears in statements by delegates from Romania

82   Klaus Dingwerth – again – and Paraguay. Now, however, these countries no longer call for a ‘democratic renewal’ of the GATT but seek to inform other members about the sincerity of their own efforts to consolidate democracy, and with it economic freedom, at the domestic level (GATT, 1991a; 1994). Only two (of a total of 207) statements apply the term to the GATT itself. The first of these criticises ‘attempts to transform the contractual character of the GATT and to undermine the democratic nature of its functioning through proposals submitted to the Group on Functioning of the GATT System’ (GATT, 1988). The second, made by the Venezuelan delegate, draws a closer link between democratisation at home and abroad: Major changes have taken place recently. Democracy and freedom, fundamental aspirations for our peoples, are spreading relentlessly. Authoritarian political systems are giving way to governments legitimized by the will of the people. In this context, it is utopian to think that negotiations on the scale of the Uruguay Round can be conducted in closed circles and that its results can be made known to the vast majority of participants once agreements have already been achieved. (GATT, 1991b) As the more recent Doha Round illustrates, this particular version of the democratic frame proved to be more lasting. In the 618 statements made at the biennial Ministerial Conferences between 2001 to 2013, we thus find over 40 references to democracy, many of which express their hope for an ‘open and democratic process’ that will lead to a ‘genuine consensus’ (WTO, 2001a). We arrive at a similar picture when we look at annual reports published by the GATT and WTO. While few of them contain explicit references to the democratic legitimation frame before 1994, the term regularly appears in reports since the WTO has been established. These numbers underline the assumption that the language of democracy has entered the GATT and WTO discourse at a relatively recent stage in its organizational history (see also Grigorescu, 2015). Yet when we examine political discourses, we are not so much interested in the frequency with which a specific term appears, but rather in the ‘webs of meaning’ that are constructed by the ways in which different terms are used and related in a field of social interaction. Seen in this way, the democratic legitimation frame comprises a broader semantic field in which notions of ‘inclusiveness’, ‘participation’ or ‘representation’ are just as relevant as notions of ‘access’, ‘openness’ or ‘transparency’, and in which additional attributes used in combination with these terms – as in ‘equal participation’, ‘effective participation’ or ‘full participation’ – can convey different messages. In the end, what the democratic legitimation frame consists of is an empirically open question that can only be answered by examining a discursive field itself. In the following sections, I discuss how the democratic frame – broadly understood – has become a new element of the normative ground on which the GATT and WTO are justified. My discussion is based on four kinds of sources:

Democracy   83 on the annual reports published by the GATT and WTO since the 1970s; on member state statements at GATT Contracting Parties and WTO Ministerial Conferences; on external comments from NGOs, business associations or journalists that appeared in the media; and on secondary literature about the legitimacy and legitimation of the GATT and WTO.2

The rise of democracy as a ‘non-­trade value’ The key argument I present in this section has two parts: first, ‘democracy’ has become firmly established in the justificatory discourse around the WTO in the late 1990s and early 2000s. Second, despite the absence of ‘democratic’ language in earlier decades, those who introduced the term to the world trade discourse in the 1990s could tie their idea of a ‘democratic’ world trade regime to concepts that had gained recognition in the world trade discourse before. The first part of my argument is revealed in speeches by the WTO Directors General, in annual reports issued by the WTO as well as in member state statements. In the latter, those invoking democracy as a legitimacy standard include developed as well as developing countries, and democratic as well as non-­ democratic governments. The French delegation, for instance, declares that ‘France favours a strong, legitimate and democratic WTO’ (WTO, 2001d, p. 1), and it applauds Director-­General Pascal Lamy for ‘making our organization more open and more democratic’ (WTO, 2013b, p. 1). The Pakistani delegation expresses its trust that delegations ‘will succeed through an open and democratic process, in evolving a genuine consensus at Doha’ (WTO, 2001a, p.  3). And China announces its readiness ‘to work together with other members towards building a more democratic, more efficient, more just and more balanced multilateral trading system’ (WTO, 2009a, p. 2). Conventional accounts stress the relevance of the Seattle protests for introducing the democracy frame (Strange, 2013). Yet while the protests have added to the strength of this frame within the legitimation discourse – notable also in the explicit acceptance of the frame by those speaking on behalf of the WTO itself – they did not invent it. Instead, the frame builds on two historical legacies that refer to the two different ways in which ‘democracy’ has been used to challenge and defend the legitimacy of the WTO throughout its politicisation period. The first of these two ways gained relevance in Uruguay Round. It sees the GATT and WTO as undermining the national democratic process. Towards the end of the Uruguay Round, this understanding is at the centre of domestic protests against the creation of the WTO in the US and elsewhere. Historically, however, such concerns are not new. When the US Congress failed to put forward post-­Second World War plans to create the International Trade Organization, the concern that this new organisation would ‘infringe on national sovereignty’ formed part of the justification (Reis, 2009, p. 44). As the GATT was less formalised, member states retained leeway in interpreting the agreements in the light of their own national preferences and laws. Moreover, disputes about national interpretations that were considered too expansive could

84   Klaus Dingwerth be dealt with in consultations involving the affected parties or, where such consultations failed, in a formal yet diplomatic rather than judicialised dispute settlement process. Informally, the GATT was thus based on a recognition of the need for ‘policy space’, a formula invented by trade diplomats, much like ‘embedded liberalism’, to allow for flexible solutions in the general trade-­off between international coordination and national sovereignty. In the Uruguay Round, it was negotiations on trade in services which led several developing countries to frame their concerns in terms of national sovereignty. The Peruvian delegation, for example, stressed that it would ‘follow closely the negotiations on trade in services, to ensure that … the general policy objectives of national legislation and regulations on services are observed’ (GATT, 1986a, p. 4). Other delegations joined the call by asking for negotiations in all areas or on trade in services specifically to observe ‘a maximum of transparency’ (GATT, 1986b, p.  1) or be ‘carried out in a most transparent manner’ (GATT, 1986c, p. 2). They thereby introduced the call for transparency as a further element of the democracy frame that was to become central in subsequent years. The Chilean delegation was most critical in this regard, and its critique pre-­figures elements of the ‘Green Room’ argument that became central to the legitimacy crisis after Seattle: The intensive consultations which have been taking place in Geneva have been characterized by a trend that is unfortunately becoming a habit, namely, our references to the lack of transparency. There has not been a single open and formal discussion in which the contracting parties could express their views concerning general matters relating to the organization, plan and procedures of the negotiations. (GATT, 1986d, p. 1) This use of a specific democratic value, however, differs from the ‘national sovereignty’ frame. It does not argue that the GATT undermines domestic democracy, but rather that its operation does not itself meet a standard of democratic governance. Like the first way in which ‘democracy’ is used to challenge the legitimacy of the GATT – and later the WTO – this second way of understanding ‘democracy’ in its international dimension gained prominence in the Uruguay Round, but builds on long-­standing arguments in the GATT discourse. While the call for transparency may indeed be novel in this regard, calls for adequate representation of developing countries are found in member states’ statements for most years of the Tokyo Round (1973–1979). Similarly, the claim that developing countries should become ‘effective participants’, ‘full participants’ or ‘full partners’ in negotiations is frequently articulated, and it also lies at the heart of the GATT’s technical assistance programme. In sum, the seeds for the steep rise of democratic normative pressures on the GATT and WTO in the 1990s and 2000s were already planted in the earlier period. At the very least, the presence of frames to which democratic values could be linked provided a fertile ground for protestors to build discursive

Democracy   85 coalitions with actors within the GATT and WTO (see also Budzugan and Payne, 2016). But this fertile ground notwithstanding, few will have expected that the WTO would, at any point of its history, emphatically present itself as ‘the most democratic international body in existence today’ (Moore, 2002).

Civil society vs the WTO: contested meaning makers Unsurprisingly, the meaning of ‘democracy’ became contested as soon as it became a widely accepted standard to determine the legitimacy of the world trade regime. In essence, two groups of actors confronted each other in a sequential encounter. Initially, social movements claimed that the WTO suffered from a ‘democratic deficit’; they thereby introduced the democratic frame in the first place. Subsequently, WTO officials made their own efforts to show that, if understood properly, the WTO was indeed a very ‘democratic’ international organisation. In the legitimation contest that ensued, both groups sought to build coalitions with like-­minded WTO members, leading the debate to gradually become an ‘internal’ affair.

The democratic deficit claim What exactly was the label of ‘democracy’ which social movements so visibly painted on their banners meant to entail? In fact, those protesting against turning the GATT into a stronger and more formal international organisation ‘with teeth’, an organisation many groups thought ‘would not be democratically accountable’ (IPS, 1992), convey at least two very different positions. While the first was focused on global inequality, the second emphasised the right of national communities to determine their own laws. In an open letter published in the Financial Times in August 1991, Clive Robinson, representing the Liaison Committee of Development NGOs to the EC, identified what he termed a ‘democratic deficit’ of the GATT system. More precisely, he saw an ‘urgent need … to democratize’ the GATT ‘by affirming its role as a referee to ensure that the poorest producers and consumers are not overpowered by the heavyweights of international trade’. Democratisation, his claim held, thus involved an effort to balance unequal power relations at the international level. Accordingly, the organisations Robinson represented called for an organisation to be ‘established in the UN’s one-­state one-­vote rule’ as this would ‘be a step towards the democratic regulation of trade which the present system has failed to provide’ (Robinson, 1991; see also IPS, 1994a). Other critics, however, sent quite a different message. They viewed GATT ‘as a conspiracy where “unelected, unknown international bureaucrats, heavily lobbied by big business, establish world health, safety and environmental policy” ’ and in which decisions were made ‘in secret and without the input of non-­governmental organizations’ (Dunne, 1991, citing the NGO Public Citizen; see also Friedman, 1994). Here, the WTO was conceived as undemocratic not so much because it was a tool of powerful nations, but rather because it undermined

86   Klaus Dingwerth the popular sovereignty of even the most powerful national community of all, the United States of America. ‘A nation’s sovereignty to set and enforce health, safety and environmental laws is compromised’, Public Citizen thus further argued in the same statement. Other groups like Oxfam and the World Wildlife Fund seconded and called for the WTO to ‘respect a nation’s right to set social and environmental standards above the agreed minimum standards’ (Shan, 1994). Somewhere in between these two poles, organisations like Greenpeace saw the ‘generally undemocratic approach’ of the GATT in its domination of – or ‘subservience to’ – multinational corporations (Dunne, 1992a). This third and very popular critique of corporate power in the GATT fitted the notion of the GATT as an instrument of the powerful as well as the critique that corporate influence undermined democracy at home. An example of the former understanding would be the charge that ‘the Uruguay Round has been largely dictated by powerful corporate interests in the US and EC, and the bargains are all struck between the major powers and their corporate advisers’, hence at the cost of developing country interests (Vidal, 1992). An example of the latter would be Ralph Nader’s use of rather drastic language to argue that the GATT was characterised by a ‘trade uber alles’ approach (Nader, 1994b). In both cases, the fact that environmentalists were ‘shut out of the decision-­making process’ while ‘their business opponents are heavily represented on advisory groups’ were called upon as evidence of the ‘undemocratic GATT practice of behind-­doors negotiation’ (Dunne, 1992b, citing Lori Wallach from Public Citizen; see also Reuters, 1992 and IPS, 1993). Finally, a fourth critique lamented the lack of public debate. Martin Griffith, Director of ActionAid, was amongst those who feared that ‘the [Multilateral Trade Organization] will simply come into being on completion of the Uruguay Round’ even though he believed ‘that such critical issues merit wide public debate’. In a letter published in the Financial Times, he asked the government ‘to give full publicity to the text of the proposed MTO, and urge parliament to undertake a full debate on the setting up of the MTO before the completion of the GATT negotiations’ (Griffith, 1992; see also Global Warming Network, 1994). Frequently, this critique also drew on the ‘corporate secrecy’ charge, for instance when U.S. activist Ralph Nader argued that: There is something about foreign trade agreements, such as the Uruguay Round of the General Agreement on Tariffs and Trade, that removes them from broad public discourse and examination. This phenomenon is pronounced when the business/government axis that drafts these agreements in exclusionary surroundings connects the thought-­stopping label ‘free trade’ with a congressional fast-­track, no-­amendment procedure that makes inquiry into details futile. (Nader, 1994a) In the same piece, Nader also challenges journalists for their failure to see the implications the Uruguay Round trade deal would have for American democracy

Democracy   87 and to report adequately about what was being negotiated. Looking at more recent debates over the TTIP agreement, we can see that the challenge of secrecy remains while critique of the media has largely silenced as the latter has learned its lessons and adopted a stronger watchdog role in the meantime. In sum, the ‘democratic deficit’ slogan served as a broad umbrella under which fitted a variety of fundamental critiques of the existing world trade regime as well as of the envisaged reforms of that regime. To be considered ‘democratic’, the GATT or WTO had to level the playing field among industrialised and developing countries, provide sufficient policy space for its members, limit corporate power and base decisions on comprehensive public debates in member states. Yet if that was what social movements associated with the ‘democratic’ label, how was it possible for WTO officials to adopt and ultimately appropriate that discourse?

The WTO’s response: reframing the democracy discourse They could do this by adopting a relatively simple strategy, namely to accept the ‘democratic’ label while amending the content for which the label stood. In the wake of the protests, the 2000 and 2001 annual reports thus seek to ‘[demonstrate] the truth that the WTO is firmly based in democratic legitimacy’ (WTO, 2000, p. 4). To underline this claim, the WTO generally stressed ‘the importance of conducting public debates on trade policy – essential in any democratic process – on the basis of an accurate understanding of the policies being considered by the negotiators’ (WTO, 2001c, p. 2). More precisely, however, it built its own ‘democratic’ claim on four broad pillars: First, the organisation emphasised that its consensus-­based decision-­making, ‘gives negotiating agendas a solid basis in democratic legitimacy and accountability’ (WTO, 2001c, p.  3). In a similar way, Director-­General Mike Moore (2002) directly addressed the critics when he argued that ‘opponents of the World Trade Organization who sometimes claim that the system is “undemocratic” start from a basic fallacy’ because the consensus rule ‘embodies … the right to sovereignty, free choice, self-­government – in other words “democracy” in its most basic sense’. In the wake of the Seattle protests, industrialised member states concurred that ‘what sets the World Trade Organization apart from other multilateral organizations is that consensus alone produces results’, thereby ‘[ensuring] the equality of the 142 Members’ (WTO, 2001b). Formulating the democratic frame in this way, the WTO primarily referred to the formal rules and largely ignored the critique that informal structures served to undermine formal equality. This critique was explicitly countered only when WTO officials stressed the role of capacity-­building and technical assistance programmes in reducing the gaps in technical know-­how and hence negotiating power between the richer and poorer member states. In contrast, WTO officials remained silent on the more fundamental problem of vast disparities in negotiating power that resulted from the different sizes of national economies.

88   Klaus Dingwerth Second, legitimacy claims issued by the WTO stressed the one state, one vote rule as another facet of equality among its member states. Those speaking on behalf of the organisation did not invoke a comparison to other organisations. But implicitly, their audiences understood that such statements drew a comparison with the World Bank and the International Monetary Fund (IMF ) as the other big players in global economic governance confronted with public protest. Since decision-­making in the latter was based on the principle of one dollar, one vote, the WTO stood out as the ‘most democratic’ among the major international economic organisations. Third, a number of actors within the WTO concluded that ‘the reply to the social criticism of our organization must be to enhance its transparency’ (WTO, 2001b). The policies WTO members enacted did not fail to impress. In 2003, the independent NGO One World Trust thus ranked the WTO third among 18 intergovernmental organisations in terms of its access to online information and applauded the organisation for making access to its legal agreements easy, providing excellent and accessible information on its trade activities and publishing its website in three languages (WTO, 2003). This result was welcomed by WTO officials as it further legitimised the organisation in relation to an increasingly relevant standard that protesters and small developing countries had invoked (WTO, 2003). That the rating focused on ‘access to online information’ rather than on ‘access to information from Green Room negotiations’ – of which both sides had been very critical – went unnoticed in the WTO’s own press release. It also did not figure prominently in the 2004 assessment on ‘The Future of the World Trade Organization’ which the WTO had commissioned a group of eminent persons led by Peter Sutherland to author. The group equally applauded the WTO for its ‘significant progress’ in external communication, and it argued that the availability of relevant documents, the speed with which information was made accessible, and the ‘excellent explanatory material now available on the WTO website’ had made WTO negotiations ‘remarkably transparent’ (Consultative Board, 2004, p. 42). Finally, the WTO used its consultation with civil society, notably in the form of its annual Public Forum, to demonstrate its increasing engagement with civil society activists. The 2004 Annual Report for example states that: 2003 was also a notable year in terms of WTO relations with civil society, parliamentarians and parliamentary groupings, and international organizations. This year saw the highest level of civil society representation in the WTO’s eight-­year history. The WTO Public Symposium held in June was the most popular ever, attracting some 700 participants. The Symposium is now an important fixture on the yearly calendar of trade-­related international events. Similarly, a record 795 NGOs and almost 1,600 of their representatives attended the Cancún Ministerial Conference in September. (WTO, 2004, p. 7) Again, individual member states concurred with this perspective when they stated that they had, ‘in the interests of transparency and participation …

Democracy   89 included for the first time representatives of the NGOs, employers and trade unions in [their] official delegation’ (WTO, 2005a). In the end, the Sutherland Report gets it right in stating that ‘as a result of [the WTO’s] much improved outreach, the perception that the WTO is a rather closed organization has been relieved’ (Consultative Board, 2004, p. 42; emphasis added). While much work went into making the WTO appear more open to non-­state actors and while informal access to the Secretariat may have increased significantly (Pérez-Esteve, 2012), the comparison with other international organisations suggests that formal access to the WTO remains more limited than elsewhere (see Strange, this volume; see also Tallberg et al., 2013). For reasons that are easy to grasp, the WTO does not actively comment on its relatively low level of formal NGO access in its communications; however, the emphasis put on its identity as an ‘institution founded on negotiated contractual commitments among governments’ provides a ready justification for the argument that ‘the primary responsibility for engaging civil society in trade policy matters rests with the Members themselves’ (Consultative Board, 2004, pp. 46–47). In sum, the WTO accepted the ‘democratic’ frame but interpreted it in a way that left its more radical implications out of the picture. It did not address the challenge of ‘corporate rule’ – which also referred to privileged access for some non-­state actors, namely lobbyists – at all, and it only minimally responded to the challenge of factual rather than formal inequality among members. Instead, it framed the ‘democratic’ label in a way that emphasised its own strengths: formal voting rules, the practice of consensual decision-­making, the accessibility of a broad range of relevant documents, and regular exchange with the more ‘reasonable’ and less ‘radical’ members of global civil society. This view was not completely out of touch with what the critics had demanded; in fact, it resonated with calls to ‘consult local communities and non-­governmental organizations’ and conduct trade negotiations ‘in a more open and publicly accountable manner’ (Shan, 1994). But it focused on the general norms and values underlying the critique rather than on the specific arguments put forth by the critics. It interpreted these norms and values in a different way. And it effectively silenced those aspects of the democratic frame from which the rules and practices of the WTO deviated most strongly.

The long legacy of Seattle Over the course of the 1990s and early 2000s, ‘democracy’ became a major reference point in the legitimation contest. The emerging consensus held that only a ‘democratic’ WTO could be a legitimate WTO. Strikingly, however, references to democracy became less frequent from around 2005 onwards when public protests against the WTO declined and when the inability of the WTO to conclude the Doha Round of multilateral trade talks became more and more evident instead. One reason for this decline in frequency is that the WTO has come to face a different challenge in the meantime. Major public challenges to the legitimacy of

90   Klaus Dingwerth the WTO now focus less on the ‘democratic deficit’, but rather on its inability to conclude the Doha Round. In his opening remarks to the 2011 Annual Report of the organisation, WTO Director-­General Pascal Lamy thus aimed to convince his audience that ‘the World Trade Organization is about much more than just the Doha Round’ (WTO, 2011, p.  10). Member state statements at the WTO Ministerial Conferences add to the normative pressure when they express their fear of a ‘total disintegration of the multilateral system’ (WTO, 2005b, p. 1), call upon other delegations to ‘show that the WTO is alive and relevant’ (WTO, 2009b, p. 2) and ‘to prove to a sceptical world that the WTO is a vital, vibrant institution, capable of producing important results for trade and development, worthy of our future confidence, attention and resources’ (WTO, 2013a, p. 2). Beyond government statements, media comments provide a similar sense of urgency, with metaphors frequently revolving around life and death. They hold that incoming WTO Director-­General Azevêdo faces a need to ‘reanimate’ an organisation that has entered the state of ‘death struggle’. They quote WTO spokesperson Keith Rockwell as expecting a ‘dangerous situation for the organisation’ should the 2015 Ministerial Conference in Nairobi fail to produce meaningful outcomes, and Swiss federal councillor Johann Schneider-­Ammann as declaring 2015 the ‘year of credibility’ for the WTO. And they see the WTO as a ‘phase-­out model’ stuck in a ‘blind-­alley’, a ‘construction site with no end’ or a ‘pile of broken glass’, with more factually minded observers noting an ‘erosion of confidence’, a ‘loss of credibility’ or simply a ‘crisis’.3 Taken together, the widespread sense of crisis is easy to spot. But what is the standard in light of which the WTO is failing? In a sense, one could speak of the end of liberalisation challenge: the legitimacy of the WTO is in jeopardy because its promise to liberalise international trade no longer seems to hold. In general, the idea that ‘if the institution … fails in concluding a Round, its overall legitimacy is at stake’ (Elsig and Dupont, 2012, p. 624) is not itself new. It derives from the notion of ‘progressive liberalisation’ that has been a central motive in the legitimation of the GATT ever since: the GATT is good if – and only if – it moves on (see e.g. GATT, 1994, p. 1). Standstill, in turn, implies breakdown in the common imagination of the world trade community. The impression that the WTO may have reached the end of multilateral liberalisation therefore constitutes a major challenge for an organisation with a mandate formulated in dynamic terms. In contrast to the 1990s, the contemporary crisis thus does not build on the impression that the ‘GATT gospel’ we have described in the introduction to this  volume is too narrow, but rather that it is no longer viable. The WTO is perceived to be unable to pursue the three core norms of multilateralism, liberalisation and consensus-­based decision-­making at the same time. But if multi­ lateralism, liberalisation and consensus no longer go together well, which one should be dropped or made to fit? Could the WTO relinquish its legislative function – and hence the promise of liberalisation – and focus on monitoring compliance with existing agreements and helping states to settle trade disputes instead? Could it leave the consensus principle that has been said to ‘blockade

Democracy   91 the WTO’ behind? Or should the WTO recalibrate its multilateral identity and make room for plurilateral agreements? In answering these questions, the democratic legitimation narrative on which the WTO embarked in the late 1990s remains central. As it significantly increases the costs of weakening the consensus norm, the democratic legitimation narrative also makes a solution to the standstill more difficult. In response to the option of dropping liberalisation, earlier situations have thus seen GATT officials make strong efforts to convey the relevance of the organisation’s day-­to-day work for the world trade system. In their opening remarks to the 42nd session of the Contracting Parties, the chairman thus stressed that ‘the regular work of GATT must, and will, proceed alongside the Uruguay Round’ (GATT, 1986e, p.  4), and member states underlined ‘the importance that we shall continue to attach to the day-­to-day functioning of GATT and to observance of GATT obligations’ (GATT, 1986f, p.  3; see also GATT, 1986g, p.  2). These statements might suggest that those seeking to defend the WTO ‘at the end of liberalisation’ could draw on an existing discursive repertoire focused on the importance of the day-­to-day activities that help to guarantee the liberalisation levels that have already been reached. On the other hand, the statements also make the limitation of such a strategy apparent, as speakers consistently present monitoring, surveillance and dispute settlement as relevant for the negotiations. In line with this interpretation, Director-­General Roberto Azevêdo has made clear from the very onset of his term of office that he does not see a viable alternative to further liberalization for the WTO: 4

Our negotiating arm is struggling. We all know that this is just one part of the work that we do here. We all know that. But the WTO, as we know, has been defined by what we have been doing in the negotiating front. This is how the world sees us. There is no escaping that. It doesn’t matter how much we say that we do more than negotiate, that we have a number of other things going on here, which are extremely important to the world even though the world doesn’t know it. People only see us as good as our progress on Doha. That is the reality. And the perception in the world is that we have forgotten how to negotiate. The perception is ineffectiveness. The perception is paralysis. Our failure to address this paralysis casts a shadow which goes well beyond the negotiating arm, and it covers every other part of our work. It is essential that we breathe new life into negotiations. We must send a clear and unequivocal message to the world that the WTO can deliver multilateral trade deals. (Azevêdo, 2013a, pp. 3–4) But while liberalisation as the sine qua non of the WTO cannot be compromised, much the same seems to hold for a consensus norm which, after the Seattle protests, has become the main pillar of the WTO’s claim to be a ‘democratic’ organisation. Because the mantra at the time stated that ‘the WTO functions on the basis of consensus’ and that, ‘along with being essential for the acceptance and

92   Klaus Dingwerth enforcement of its rules, [consensus] also gives negotiating agendas a solid basis in democratic legitimacy and accountability’ (WTO, 2001, p. 5), tinkering with the consensus norm would make the WTO vulnerable to the democratic deficit challenge again. The traumatic experience of the Seattle protests suffices for WTO members as well as officials wanting to avoid that challenge. Moreover, the observation that recent protests against regional trade agreements like the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU or the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US strongly rely on democratic frames is likely to further strengthen the desire not to become vulnerable on the democratic front. Consequently, WTO officials and members seek not to give the impression that the consensus norm is up for negotiation. Instead, they interpret even small steps – among them the limited agreements reached at the 2013 and 2015 Ministerial Conferences in Bali and Nairobi – as a proof of a regained ability to deliver on the promise of multilateral consensus-­ based liberalisation. When 54 WTO members reached agreement on reductions for trade in IT goods in July 2015, Azevêdo saw ‘the first major tariff-­cutting deal at the WTO in 18 years’ as a proof ‘that the multilateral trading system can deliver’. What is interesting in this statement is that the agreement itself is multilateral in the sense that 54 WTO members signed up to it. In contrast to plurilateral agreements, signatories also extend the benefits of the agreement to non-­signatory WTO members. Yet the agreement is not multilateral in the sense the term is most commonly used in GATT speak, namely to designate an agreement to which all WTO members subscribe. So Azevêdo’s statement in fact seeks to solve the trilemma by re-­defining the meaning of multilateralism in the legitimation contest around the WTO. In sum, our discussion reveals two important legacies of Seattle. First, it might be true that the decline of public protests against the WTO has driven down the organisation’s need to explicitly refer to democratic norms in its legitimacy claims. Yet the implicit threat that social movements could be re-­mobilised once trade negotiations regain momentum means that the organisation will be very wary of weakening the basis on which it could defend itself against the ‘democratic deficit’ charges that have proven to be powerful in past episodes of conflict. But fear of mobilisation is only one aspect that makes the democratic legitimation frame sticky. The second part is a kind of normative path dependence that stems from the fact that the WTO has tied its claim to be a ‘democratic’ organisation closely to the consensus norm. This implies a re-­ interpretation of the latter – a traditional cornerstone in the legitimation of the GATT – in a way that ultimately turns democratic standards, via the re-­ interpreted consensus norm, into a part of the ‘GATT gospel’. As we have seen in this section, this gospel is hardly sacrosanct, but tinkering with gospel norms is likely to stir unrest among some players in the world trade regime.

Democracy   93

Conclusion In sum, ‘democracy’ has become a term of trade. Democratic legitimation norms entered the GATT/WTO legitimation discourse around 1994, gained strength after Seattle and remained topical for just over a decade. As in other areas of global governance, they emerged under specific circumstances, among them a major transfer of authority to the WTO and panel decisions that provided a window of opportunity for environmental and labour rights campaigns at a time in world history in which transnational social movements were relatively strong. More recently, democratic normative pressures may have lost some of their visible strength. The WTO managed to adopt and re-­direct the ‘democratic deficit’ discourse, and the specific conditions that gave rise to that discourse have gradually weakened. Despite their lower visibility, however, democratic standards remain relevant as a normative resource developing country members use to advance their cases in the WTO, but also as a legacy of Seattle that activists may be able to re-­activate any time. The latter possibility is not only underlined by the more recent contestation of the efforts to negotiate a Transatlantic Trade and Investment Partnership (TTIP) outside the WTO, but it is also a possibility against which WTO officials are keen to guard themselves in their efforts to prevent yet another legitimacy crisis. Ultimately, the WTO thus finds itself caught in a dilemma. On the one hand, the rise of democratic norms is yet another element that, along with the rise of emerging markets and the legalisation of multilateral trade relations, makes the task of concluding further multilateral trade negotiations more challenging. On the other hand, weakening its democratic claims implies the risk of protest once negotiations progress. The success the WTO achieved when it adopted and appropriated the democratic deficit discourse may well thus turn out to have been a Pyrrhic victory.

Notes 1 Cartoon ‘Road to Nowhere’, URL: www.polyp.org.uk/cartoons/democracy/polyp_ cartoon_WTO_democracy.jpg (last accessed 16 June 2016). 2 Member state statements are limited to the years of the Tokyo, Uruguay and Doha Rounds; in addition, media comments are limited to sources included in the Factiva database (https://global.factiva.com/). 3 Business Times, 28 July 2015; Neue Zürcher Zeitung, 26 January 2015; 2 August 2014; 26 June 2014, 10 September 2013, 11 May 2013, 4 August 2012, 20 December 2011, 11 June 2011. 4 Neue Zürcher Zeitung, 2 August 2014 and 5 December 2013.

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94   Klaus Dingwerth Consultative Board, 2004. The Future of the World Trade Organization: Addressing Institutional Challenges in the New Millennium, report by the Consultative Board to Supachai Panitchpakdi, Director-­General. Geneva: World Trade Organization. Dunne, N., 1991. World Trade News: Environment rules set stage for GATT conflicts – resolving the clash could be the most important trade issue of the 1990s. Financial Times, 5 December, p. 6. Dunne, N., 1992a. Trade and the environment: US greens lose faith in promises. Financial Times, 12 February, p. 3. Dunne, N., 1992b. World Trade News: Fears over ‘Gattzilla the trade monster’ – US greens lead a growing lobby worried about loss of sovereignty. Financial Times, 30 January, p. 3. Elsig, M. and Dupont, C., 2012. Persistent deadlock in multilateral trade negotiations: The case of Doha, in Narlikar, A., Daunton M. and Stern, R.M., eds. The Oxford Handbook on the World Trade Organization. Oxford: Oxford University Press. Friedman, T.L., 1994. Yes, we’ve GATT a deal – yes, there is a catch. The Australian Financial Review, 15 April. GATT, 1974. Summary Record of the Third Meeting Held at the Palais des Nations, Geneva, Contracting Parties, Thirtieth Session, SR.30/3, 20 November 1974. Geneva: GATT. GATT, 1986a. Peru: Statement by H.E. Mr. José Carlos Mariátegui Arellano, Ambassador, Permanent Representative. Contracting Party, Forty-­Second Session (= GATT Document No. GATT SR.42/ST/2, 16 December). Geneva: GATT. GATT, 1986b. Poland: Statement by Mr. Janusz Kaczurba, Deputy Minister of Foreign Trade. Contracting Party, Forty-­Second Session (= GATT Document No. GATT SR.42/ST/12, 16 December). Geneva: GATT. GATT, 1986c. Korea: Statement by H.E. Mr. Sang Ock Lee, Ambassador, Permanent Representative. Contracting Party, Forty-­Second Session (= GATT Document No. GATT SR.42/ST/9, 16 December). Geneva: GATT. GATT, 1986d. Chile: Statement by H.E. Mr. Mario Barros van Buren, Ambassador, Permanent Representative. Contracting Party, Forty-­Second Session (= GATT Document No. GATT SR.42/ST/33, 22 December). Geneva: GATT. GATT, 1986e. Japan: Opening Statement by the Chairman Ambassador Kazuo Chiba. Contracting Party, Forty-­Second Session of the GATT (= GATT Document No. GATT/1401, 24 November). Geneva: GATT. GATT, 1986f. Switzerland: Statement by H.E. Mr. Pierre-­Louis Girard, Ambassador, Permanent Representative. Contracting Party, Forty-­Second Session (= GATT Document No. SR.42/ST/10, 16 December 1986). Geneva: GATT. GATT, 1986g. Austria: Statement by H.E. Mr. Georg Reisch, Ambassador, Permanent Representative. Contracting Party, Forty-­Second Session (= GATT Document No. SR.42/ST/14, 17 December). Geneva: GATT. GATT, 1988. India: Statement by H.E. Mr. S.P. Shukla, Ambassador, Permanent Representative. Contracting Party, Forty-­Fourth Session, SR.44/17., given 23 November 1988. Geneva: GATT. GATT, 1991a. Romania: Statement by M. Adrian Constantinescu, Head of Delegation. Statement at Contracting Parties: Forty-­Sixth Session, No. SR.46/1., given 4 January 1991. Geneva: GATT. GATT, 1991b. Venezuela: Statement by H.E. Mr. Miguel Rodriguez Mendoza, Presidential Commissioner for International Economic Affairs. Statement at Contracting Parties: Forty-­Sixth Session, No. SR.46/5., given 4 January 1991. Geneva: GATT.

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96   Klaus Dingwerth WTO, 2001d. France: Statement by H.E. Mr Laurent Fabius, Minister for Economy, Finance and Industry. Ministerial Conference, Fourth Session (= WTO Document No. WT/MIN(01)/ST/15, 10 November). Geneva: World Trade Organization. WTO, 2003. WTO Gets High Marks for Accountability, Transparency, WTO Press Release, 11 February, Available from:www.wto.org/english/news_e/news03_e/global_ account_report_11feb03_e.htm [accessed 5 July 2016]. WTO, 2004. Annual Report 2004. Geneva: World Trade Organization. WTO, 2005a. Spain: Statement by HE Mr. Jose Montilla Aguilera, Minister of Industry, Tourism and Commerce. Ministerial Conference, Sixth Session (= WTO Document No. WT/MIN(05)/ST/44, 15 December). Geneva: World Trade Organization. WTO, 2005b. Norway: Statement by HE Mr Jonas Gahr Støre, Minister of Foreign Affairs. Ministerial Conference, Sixth Session (= WTO Document No. WT/MIN(05)/ ST/30.Rev, 15 December 2005). Geneva: World Trade Organization. WTO, 2009a. China: Statement by H.E. Mr. Chen Deming, Minister of Commerce. Ministerial Conference, Seventh Session (= WTO Document No. WT/MIN(09)/ST/113, 2 December). Geneva: World Trade Organization. WTO, 2009b. Switzerland: Statement by HE Councillor Doris Leuthard, Minister of Economic Affairs. Ministerial Conference, Seventh Session (= WTO Document No. WT/ MIN(09)/ST2, 30 November). Geneva: World Trade Organization. WTO, 2011. Annual Report 2011. Geneva: World Trade Organization. WTO, 2013a. United States: Statement by H.E. Mr Michael Froman, Trade Representative. Ministerial Conference, Ninth Session (= WTO Document No. WT/MIN(13)/ ST/18, 4 December). Geneva: World Trade Organization. WTO, 2013b. France: Statement by H.E. Mrs Nicole Bricq, Minister of Foreign Trade. Ministerial Conference, Ninth Session (= WTO Document No. WT/MIN(13)/ST/53, 5 December). Geneva: World Trade Organization.

7 Civil society Michael Strange

Introduction In December 1999, international news headlines announced the arrival of ‘civil society’ as a term at the heart of global trade governance (Brown, 1999). Protest marches consisting primarily of trade unionists and environmentalists were credited with the collapse of the World Trade Organization’s Seattle Ministerial Conference and, subsequently, attempts to launch the so-­called ‘Millennium Round’ of trade negotiations. Whilst that often-­mythologised narrative overlooks other key explanatory factors, what remains evident is the way in which both critics and protagonists of the current shape of global trade governance came to see civil society as important to its legitimacy. The response of the WTO Secretariat to the events of Seattle, which included creating new avenues by which civil society could more formally engage with the organisation, gave ‘NGOs’ – non-­governmental organisations – a growing role in the system. Similar stories of ‘NGO emergence’ – a new category of actorness (that is, who or what can be an actor in this field) – can be seen in, for example, how the European Commission manages civil society during current negotiations towards the Transatlantic Trade and Investment Partnership (TTIP) as well as global trade governance more generally (Scholte, 2011; on TTIP see De Ville and Siles-­Brügge, 2015). Many observers might therefore conclude that within the field of global trade governance it is well understood what is meant by the term ‘civil society’. Yet, that is far from the case. Indeed, as this chapter shows, not only is there significant ambiguity, but the term ‘civil society’ sits at the centre of an ongoing political struggle over both: (a) to whom or what it applies; and, (b) its respective role within the governance of global trade. The chapter is structured as follows. The first part begins with a mind map, tracing out the competing ideas at stake within how ‘civil society’ is used as a term in global trade governance. In particular, there is a need to consider how ‘civil society’ can be used to refer to both NGOs and social movements. For example, institutional actors have been more willing to recognise civil society where this is defined as ‘NGOs’; more informal forms of activism tend to be largely excluded. Struggles over the meaning of ‘civil society’ are part of a

98   Michael Strange broader contestation over who or what should be recognised as an actor in global trade governance, as the chapter will argue. Some might see the story of ‘civil society’ in global trade governance as just an account of how the WTO Secretariat, and other institutional actors, gives recognition to certain individuals and groups. For example, what kinds of meetings can they attend, and will their views be acknowledged? Whilst asking who is recognised and how are important questions, there is another side of this puzzle that needs to be considered. That is, why is it that the actors described as ‘civil society’ are at all interested in global trade governance? Whether attending meetings, writing campaign pamphlets, or joining street protests, all these actions require substantial investment. That process is one of politicisation in which actors not previously interested in trade politics have, however, come to view this particular sphere of human interaction as relevant to their own political identities. That side of the puzzle forms the core of the chapter’s second part. First, however, the chapter looks at what is meant by the term ‘civil society’ in global trade governance.

Civil society in global trade governance Mind mapping What is ‘civil society’ in global trade governance? An activist campaigning against a particular trade agreement, when told he was part of ‘civil society’, objected on the grounds that, for him, it was important to be seen as ‘uncivil’.1 For that activist, the term ‘civil’ denoted conformity and the threat of co-­ optation. For him, being a political activist required that he resist the civil norms of mainstream political-­economic society. That response is far from uncommon amongst many activists critical of mainstream global trade governance. Today, the term ‘civil society’ is used to broadly identify a group of actors who have in common the status of being non-­state actors, though as the Italian political theorist Antonio Gramsci understood back in the early twentieth century, the distinction between the state and civil society is far from clear. Civil society is often treated as a voice of political dissent, from varying ends of the political spectrum, that through being outside state institutions is better equipped to represent the plurality of interests and issues present in society. Yet, for Gramsci, civil society is key to ensuring the state’s survival where it provides the means to maintain consent. Gramsci’s reading of civil society was reflected in the above-­mentioned activist’s rejection of the label. What both approaches share, however, is the understanding that civil society exists as a realm conceptually distinct to the political society of politicians and civil servants. The term ‘civil society’ does not in itself denote whether an actor is likely to contest or support the state. The political identity of any group or individual is therefore not given by the term ‘civil society’ alone. In the context of this book, civil society becomes relevant wherever those actors it covers impact global trade governance. As distinct to the political

Civil society   99 society of that global trade governance, ‘civil society’ refers to actors outside both the nation-­states and the legal institutions coordinating their joint enterprise. Though certainly trying to influence that political society, companies and persons actively engaged in global trade are treated as distinct from ‘civil society’, falling into what can be thought of as ‘economic society’. However, the lines between these different categories – political, economic, and civil – are not impermeable. Civil society is commonly viewed as consisting of not-­for-profit groups, focused on campaigning for a particular cause. For this reason, business actors are not civil society. However, this definition becomes harder to maintain if we consider three actors in particular: trade unions; business associations; and lobbying firms. Trade unions are often seen as part of civil society in their role as advocacy organisations, their priority being to protect the economic interests of their members. Many trade unions have also taken on a series of non-­interest-based issues within their campaigning portfolios, such as on the environment, gender, racism, and so on, such that they claim a role that goes beyond just trying to protect their members’ salaries. Business associations are more clearly part of economic society, created to aggregate a series of common demands representing particular industrial sectors. However, business associations overlap with political society to the extent that many at the transnational level were originally created via assistance from international organisations. For example, the European Commission has taken an active role in helping to instigate several European-­level business associations as a means of forming a common European position on certain economic issues, e.g. trade-­in-services. Where international organisations later turn to these business associations for information on how a particular industry views a trade negotiation, they are treated as if part of civil society. The extensive role of lobbying firms within global trade governance further complicates how we mind map the concept of ‘civil society’ where advocacy becomes a for-­profit activity. Lobbying firms represent the professionalisation of advocacy and have created much controversy over the fear that moneyed groups able to purchase the services of these firms may be able to exert undue pressure on the politicians and civil servants of political society. However, at the same time, the level of technical complexity involved in global trade – a policy field encompassing an almost limitless array of economic activities – necessitates the collection and dissemination of information from a broad range of economic interests if that field is to be optimally governed. This is why, at least in the eyes of many politicians and civil servants involved in global trade governance, business associations operating at the transnational level are so important. Lobbying firms fit into these relations through providing additional resources individual business associations or companies can purchase on an ad hoc basis to represent their interests. As advocates, lobbying firms appear as part of civil society. For many groups that campaign on issues tied to wider societal concerns like the environment, and who rely extensively on public donations for their work, however, describing for-­profit groups as civil society undermines what

100   Michael Strange they see as its key role – to represent society to politicians and civil servants. According to this understanding, where advocacy is dependent upon which interests or issues are most able to afford the services of a lobbying firm, this distorts that process of representation and undermines the legitimacy of any resulting policies. Whether lobbying firms are inside or outside civil society is therefore more of a normative, than an empirical, question. Indeed, this last point opens up an even bigger question, which is: Is ‘civil society’ an empirical concept, or do we also need to understand it as a normative concept? That is, to what extent does it go beyond stating what is, to argue for what should be? The above mind map has so far focused on defining ‘civil society’ in respect to what empirical phenomena it is most typically used to describe. Yet, and this is certainly true within global trade governance, as a label ‘civil society’ is closely associated with calls for deliberative democracy in policy decisions (Dryzek, 2006). There are two aspects that are worth mentioning. First, it is what civil society brings to the input and output stages of decision-­making. That is, in a nutshell, to provide a political community able to both provide a plurality of perspectives relevant to informing policy decisions, and also critically monitor the impact of those decisions. That civil society should have the right to play such a role is based on the second aspect, relating to the above-­mentioned idea that civil society is somehow representative of societal concerns. Civil society cannot claim authority in the same way enjoyed by elected politicians. On questioning a then-­prominent UK government minister on trade policy, an activist was challenged on the grounds that they were, unlike the MP, unelected by the public.2 In response, the activist argued that his democratic mandate rested on, at least for him, something stronger – a regular financial donation, as opposed to just a tick on a ballot paper. Whilst arguably this assumes too much as to how people view their charitable donation, as a normative project civil society is often presented as a supplement to support democratic deliberation – both through potentially giving voice to a broader range of stakeholders affected by policy decisions but who are normally excluded in majoritarian decision-­making, and through including many issues that go beyond narrow interests. Civil society is often seen to include groups that frame their demands (e.g. preventing fishing practices harmful to turtle populations) in terms of broader social goals (e.g. protecting the environment). An issue such as foreign ownership of national healthcare services, for example, might be framed in terms of ‘the market vs the people’. Campaigners draw upon a list of social issues by which to argue their demands, including, for example: labour rights; ending racism; gender equality; and, social justice. Presenting much narrower political demands in terms of these broader social goals not only marks out a special role for civil society as a type of ‘social conscience’, it also serves to help build bridges between campaign groups. Without such linkages it becomes impossible for a movement critical of a particular trade negotiation to attract interest from groups focused on wider social concerns (e.g. environment, gender).

Civil society   101 Mentioning ‘movements’ leads to the final point to be discussed within this mind-­mapping exercise – that is, the extent to which civil society is organised. When discussing civil society, a series of inter-­related analytical terms come into play. These include, but are not limited to the following list: CSO; NGO; SMO; and, just plainly, SM. The first three acronyms within that alphabet spaghetti all end with the letter ‘O’, which in all these cases designates the word ‘organisation’. That is: ‘civil society organisation’, ‘non-­governmental organisation’, and ‘social movement organisation’. In general usage, ‘CSO’ and ‘NGO’ are interchangeable. They may refer to a large multinational group such as Amnesty International, or a group staffed by one paid-­individual – the owner-­manager – aided by a string of regularly alternating interns. That owner-­manager may well have a similar role within several other groups too, meaning that no two CSOs/NGOs are alike. It should be said that the main distinction between the two terms is the relative emphasis on the phrase ‘non-­governmental’, though as argued above this is also implied within the concept of ‘civil society’. The term ‘social movement organisation’ is much more distinct to CSO/NGO through its focus on social movements (abbreviated earlier on its own as ‘SM’). Social movements are highly diffuse, formed through a series of largely informal relations between individuals and made visible in a variety of means (i.e. public meetings, street protests, petitions) (Strange, 2011). They may be limited to one campaign, but to the extent that professional activist groups orchestrate campaigns, the movement may well encompass a long series of overlapping campaigns. This means that it is never possible to clearly mark out the origins and ends of social movements. However, for the movement to be visible – to manage the logistics of printing political material, analysing complex trade deals, attending meetings with prominent officials – organisations become paramount (see Eagleton-­Pierce, 2013). This often means particular individuals become paramount where they are the ones to first write a critical report on a trade deal that can then be cited by other groups and activists within the movement. This leads to certain analytical problems, since the term ‘social movement’ implies a much more horizontal political structure than one in which individuals – who are often employed by comparatively well-­resourced groups – are central. Yet, equally, speaking of ‘social movements’ as opposed to just organisations allows focus on the more diffuse and non-­professional relations at play within civil society. The term ‘social movement’ refers to the harder-­to-define parts of civil society. As will be discussed next, this creates a problem for any attempt to categorise who should and should not be recognised as part of civil society, given that any given social movement will always exceed that part which is organised and tied to specific groups or individuals.

102   Michael Strange Meaning makers Given that ‘civil society’ is not just a descriptive term but carries with it a significant normative baggage, it should come as no surprise that in the often highly political field of global trade governance we see a history of battles between meaning makers over who or what can be classed as ‘civil society’. This is evident in the example of the World Trade Organization (WTO), where acknowledgement of civil society by the WTO Secretariat has been filtered through the ‘NGO’ category. There, a struggle has taken place over who or what is an ‘NGO’ eligible for this recognition. In discussing contestation over this particular actor-­identity through which civil society has been made visible in global trade governance, in this section the chapter shows how competing definitions over these categories have distributional consequences with respect to who/ what gets included or excluded. Where the normative value of civil society is based on its supposed claim to represent societal concerns to political society, any exclusion means limiting which societal concerns need be considered when undertaking global trade governance. This section first provides a brief history of civil society and global trade governance, before considering attempts by the WTO Secretariat to manage civil society under the ‘NGO’ label, and concluding with a comparison to the role of civil society within another aspect of global trade governance – the ongoing TTIP negotiations. A brief history of civil society in global trade governance Going back to the failed attempts to create an International Trade Organisation (ITO) in the late 1940s, the history of contemporary global trade governance has seen very mixed approaches towards civil society. Where civil society has been recognised as somehow relevant, it has been under the ‘NGO’ label. Article 87 of the ITO’s Havana Charter included a provision enabling the organisation to establish working relations with NGOs, a note stating: ‘it is clearly desirable that the ITO should be able to take full advantage of the knowledge and expertise of  the non-­governmental organizations in … various fields’. When efforts to ratify the ITO within the US Senate were abandoned and the proposed body faded away, what remained were the set of rules it was meant to have hosted – the General Agreement on Tariffs and Trade (GATT). The GATT, of course, survived to become a significant regime that would be expanded and eventually find a home when the WTO was created in 1995. The ITO’s acknowledgement of NGOs was not included in the GATT, meaning that up until the WTO’s inception there were no formal channels by which civil society could be made visible in global trade governance. Whilst GATT documents sometimes made reference to ‘non-­governmental parties’, this referred to the selection of panellists for the GATT’s dispute settlement mechanism. Traditionally, civil society was seen as relevant only at the national level, where political demands could be expressed but it was up to the national governments whether to include them within their negotiating position as Contracting Parties to the GATT.

Civil society   103 WTO Secretariat attempts to manage civil society The Marrakesh Agreement establishing the WTO does acknowledge NGOs, though what this means in practice is highly ambiguous – Article 5 paragraph 2 stating: ‘The General Council may make appropriate arrangements for consultation and cooperation with non-­governmental organizations concerned with matters related to those of the WTO’. This was significant as at the Ministerial meeting where the Marrakesh Agreement was formally signed, groups not affiliated with the Secretariat or one of the GATT Contracting Parties could only be present if able to show press credentials. What type of role NGOs were to be given at the WTO, and who might be able to call themselves an ‘NGO’, became clearer at the WTO’s first Ministerial Conference, hosted by Singapore at the end of 1996. The WTO Secretariat took a lead in shaping what was meant by the term ‘non-­governmental organisation’ with a set of guidelines on ‘arrangements on relations with NGOs’ that limited their role to ‘increas[ing] the awareness of the public in respect of WTO activities’. Significantly, the guidelines concluded that: ‘Closer consultation and cooperation with NGOs can … be met constructively through appropriate processes at the national level where lies primary responsibility for taking into account the different elements of public interest which are brought to bear on trade policy-­making’ (WTO Secretariat, 1996). The WTO Secretariat tried to largely avoid treating civil society as an international actor, limiting it to the confines of national politics over which governments are the gatekeepers. Where it came to drawing up the procedures for accrediting civil society for attendance at the first Ministerial Conference, hosted by Singapore in 1996, meetings held amongst member state delegates in the General Council concluded that an eligible NGO needed to be a ‘non-­profit’ group. This led to the Secretariat declining requests from law firms, as well as private companies, who were asked to re-­apply via their industry association. Business associations were therefore allowed under the ‘NGO’ banner, constituting between 44 to 65 per cent of those carrying the ‘NGO’ badge (Marceau and Pedersen, 1999, p.  46; O’Brien et al., 2000, p. 94). Another key criterion used by the Secretariat when selecting groups for attendance was their relevance to the work of the WTO. This was used, for example, to deny access to Education International (EI) – an international trade union body that arguably has an interest through the extent to which education is included under the General Agreement on Trade in Services (GATS) hosted by the WTO (see O’Brien et al., 2000, p. 93). Even where groups were granted access, this did not equate to observer status at any decision-­making meetings; they were left instead to use the NGO facilities on the outskirts of the main event. Whether this enabled meetings with member state delegations or WTO Secretariat officials depended on what relations groups already possessed, rather than necessarily facilitating any new channels for advocacy. Given the venue of Singapore, the potential for contestatory action was already limited. Overall, the choice of venue for Ministerial Conferences has had a significant impact upon which groups can access meetings – and

104   Michael Strange thus be visible as ‘civil society’ – due to both geographical proximity but, more importantly, the extent to which the local political regime allowed open political dissent (Piewitt, 2010; Steffek, 2012). Hosting the second Ministerial Conference in Geneva, in 1998, saw a quite different political context, with visible public protests outside the gates of the meeting venue. There it was harder to narrow down civil society to the ‘NGO’ label, particularly as the Secretariat tried to frame it. The strategy adopted by the Secretariat at Geneva was, however, to try and claim recognition of the ‘challenges’ – i.e. social, environmental, cultural – people face in different societies, with the suggestion that the WTO–NGO relationship might be a solution (Wilkinson, 2005). No substantive information was given, however, as to how this relationship might be developed to resolve these challenges. Protests at the gate – seen in the media as sometimes violent – evidence a counter-­move in defining civil society, so that it exceeded the narrow category authored by the WTO Secretariat. Protesters were largely treated as out of touch, and therefore irrelevant, compared to the more ‘civil’ individuals wearing ‘NGO’ badges within the Conference venue. That method of managing voices of dissent continued at the WTO’s next Ministerial Conference, hosted in Seattle in December 1999. Since 1996, civil society had become much more visible in contesting, in particular, the impact of economic globalisation on labour rights and environmental protections. The reasons for this politicisation are discussed in the chapter’s second half. The Seattle Ministerial was a turning point for many, both for the WTO and its critics within civil society. It saw mass street protests, made all the more visible through the media’s focus on a poorly planned and sudden response from the police that led to several violent confrontations and acts of vandalism in a city normally known for its sedate character. The protests were blamed – or, in the eyes of some, celebrated – when the delegates failed to reach a compromise that would have launched a new round of trade negotiations (the Millennium Round) and the conference effectively collapsed. The protests made the WTO a household name as front-­page news, in stark contrast to the relative obscurity of the GATT. For civil society groups, the organisation leading up to Seattle and the myth that developed in its aftermath gave a sense that their collective endeavours might impact on the shape of global trade governance. Some suggested that despite the collapse of the Soviet Union, the world was still in a state of bi-­ polarity but now between a USA espousing neoliberal economics (i.e. deregulation, the shift of power over to multinational corporations, and a lack of sensitivity to social and environmental issues) countered by a so-­called ‘Global Justice Movement’ – a ‘rainbow coalition’ of different groups with differing agendas but sharing a common critique of ‘social and environmental injustice’. What part civil society played in the collapse of the Seattle Ministerial is debatable. Whilst the protests created additional logistical hurdles for delegates, overall the critical issue was a major disagreement between member states along a ‘developed’ and ‘developing’ country divide over to what extent the promises of the Uruguay Round had been evenly delivered with many developing-­countries

Civil society   105 claiming foul. Civil society did have more influence at Seattle than in previous Ministerials, however, as it came as then-­US Vice-­President Al Gore was seeking nomination as the Democratic candidate. This enabled the unions to put pressure so that President Clinton made a vague but significant suggestion that the WTO consider labour standards within future trade agreements (O’Brien et al., 2000, p.  140). This only helped further disagreement amongst the member states. The collapse of the Seattle ministerial was hugely significant for those activists involved, but also campaigners elsewhere, as it made visible an image of ‘civil society’ as an effective political movement that exceeded attempts to limit civil society to being a relatively passive provider of societal information for states and international organisations. Since Seattle, the WTO Secretariat has taken an increasingly active role in formally recognising ‘NGOs’ and, in the process, determining which aspects of civil society are seen as relevant within global trade governance. For example, since 2000, the WTO annual reports have included a section on relations with ‘NGOs’ (Scholte, 2004, pp.  153–155; see also Sutherland, 2005). The most obvious display of WTO–NGO relations comes with the annual public forum hosted at the WTO’s headquarters in Geneva, which began initially in 1994 as a ‘symposia’ in which delegates, parliamentarians, journalists, academics, and the staff of NGOs could meet and discuss relevant issues. To attend one must apply via the WTO Secretariat, and entering the WTO headquarters requires passing through a security check similar to that in airports. Once in, however, there is a surprising degree of freedom given that beyond the opening plenaries given by the Director-­General and various Heads of State, many of the panels are organised and chaired by persons not associated with the WTO itself. The organisers of past panels have included groups otherwise often very critical of the WTO’s governance, such as Friends of the Earth International and the Third World Network. These groups have, however, become increasingly less active within the WTO’s Public Forum, suggesting they may not see these events as particularly helpful to their work. Indeed, this has been confirmed by at least some activists in interviews. In addition to appearing as speakers or even panel organisers in the WTO Public Forum, civil society groups can author ‘NGO Position Papers’. The WTO Secretariat has an open invitation for external actors to provide these papers as an information resource to the member states. The WTO Secretariat selects which papers are relevant prior to disseminating a list of these papers via a news bulletin sent to the WTO Member-­state delegations (Marceau and Pedersen, 1999, p. 20). In some cases, civil society groups manage the WTO–NGO relationship. One example is the Geneva-­based International Centre for Trade and Sustainable Development (ICTSD) (Hannah, 2014). ICTSD produces research and organises events often focused on helping to enhance the negotiating capacity of developing states belonging to the WTO, and the WTO Secretariat and delegates have often been present at its events. Where these events are organised in various capitals in Africa and Asia, the ICTSD takes an important role in adding to the

106   Michael Strange WTO Secretariat’s task to build the technical-­capacity of its developing country Member states. Here civil society clearly serves as an important resource for the WTO. Pascal Lamy’s long tenure as Director-­General of the WTO, from 2005 to 2013, saw two important developments: first, a more systematic strategy to monitor the concerns of civil society organisations; and, second, increased participation within workshops for civil society in developing countries (Perez-­ Esteve, 2012). At the same time, though, during the slow and often stalling Doha Round negotiations the WTO’s role in global trade governance has become less certain as whilst both China and Russia have joined and so brought the vast majority of all trade within its remit, Member states have increasingly turned to bilateral and regional regimes with the WTO seemingly down-­prioritised. This has been mirrored in the activity of civil society groups, including those active at Seattle. Despite the more parochial character of these regimes, when critiquing these negotiations activists typically maintain a ‘global’ frame to their campaigns – presenting the deal as a threat not just to their national context, but in terms of dangers they see as global. Typically, the chief danger for campaigners is what they term as ‘corporate power’ – that is, the growing role of private capital in global trade governance. Civil society and the TTIP negotiations Many of those groups and individuals involved in civil society contesting WTO policies have been active in campaigns around other parts of global trade governance, including negotiations towards the US–EU Transatlantic Trade and Investment Partnership (TTIP) (for TTIP, see De Ville and Siles-­Brügge, 2015). Alliances built via earlier campaigns mean groups on both sides of the ‘pond’ regularly share information and strategy proposals. European groups have, however, been more active due to a number of factors. First, US groups have been focused on a range of other trade deals they see as more threatening, such as the Trans-­Pacific Partnership (TPP). Second, one reason they see the TTIP as less disturbing is that for trade unions the possibility of harmonisation between US and EU labour rights could be a significant gain. European groups have, however, extensively cited those US groups that have criticised TTIP. That critique has largely focused on the inclusion of an investor-­state dispute (ISD) mechanism in which corporations would be able to sue the US or EU if new regulations were seen to damage their investments. Two further points of critique seen from both US and European groups have been on consumer and environmental safety and the fear that TTIP threatens to undermine regulations in these two areas. This apparent unity is largely limited to the sharing of ideas and cross-­citations, rather than sharing more material resources. However, in the context of social movement activity ideas are themselves a valuable resource. There have also been several meetings framed as ‘transatlantic dialogues’ with representatives from different issue sectors attending as speakers. It is worth noting that whilst the ‘transatlantic’ frame is often

Civil society   107 stated, in campaign leaflets and public events there is an equally vocal assertion that TTIP is a ‘global’ threat, framing it in terms of harm to developing countries as well as the principle parties represented in negotiations. Much of the European activity has taken place via a coalition of groups formed originally as a means to build upon Seattle and contest the EU’s position at the WTO – aptly named as the ‘Seattle to Brussels’ (S2B) network. The exception to this has been in Germany where campaigners against TTIP managed to create a mass movement critical of the negotiations unparalleled elsewhere, and subsequently downplayed the ‘global’ frame in favour of focusing on TTIP as a ‘national’ threat to, for example, consumer safety. The European Commission has a long history of working with, and even funding, many groups that make up European civil society. Having civil society at the European level has been seen as important to fostering European integration, providing it with the semblance of a nation-­state. Civil society has had a mixed relationship with the European Commission’s Directorate General for Trade (DG Trade). DG Trade was active in helping to establish many of the business associations now lobbying it, as mentioned above. And, as said, the budgets of some of the groups most vocally criticising DG Trade for ignoring societal concerns include significant contributions from the Commission. Yet, DG Trade has largely excluded those vocal critics from the decision-­making process. This is in contrast to the US where there is a tradition of non-­state actors being invited as ‘experts’ within advisory groups to the United States Trade Representative (USTR), though there is criticism that business interests dominate the groups. In creating a series of special advisory groups to which civil society was invited to attend, DG Trade tried to strictly manage who might be included (Strange, 2015). First, the meetings included representatives from business associations that had been lobbying for the TTIP. Second, those who attended were instructed that they could not report back to their organisations, maintaining strict confidentially. Lacking the enforcement powers of a nation-­state, however, meant that this instruction was easily ignored. Third, despite promises to the contrary, attendees were for a long time not given access to the negotiating text meaning that their comments could only be made in the abstract. The special advisory groups both opened up new opportunities for civil society to be visible within EU trade policy but, also, provided DG Trade an opportunity to influence the definition of who counts as ‘civil society’ and the behaviour of actors accepted within that term. The meaning of ‘civil society’ in global trade governance is inherently unfixed, due to the political significance of any definition. There remains an ongoing struggle to define which groups and individuals may be included in this category of actor, because the claim to include civil society in policy processes carries with it a significant normative value. However, why is it that civil society has become interested in global trade governance? Next, the chapter looks at how activists have become politicised to be ‘active’ in global trade such that civil society has become visible.

108   Michael Strange

Politicised to be ‘active’ in global trade governance Who or what is recognised as ‘civil society’ matters in global trade governance because it forms part of a broader struggle over what societal influences feed into its design and implementation. Yet, as the above section shows, institutional actors do not control this filtering process alone even if they are formally in charge of admittance to institutional venues. The discursive dynamics of global trade governance are not limited to formal actors designated by institutional actors but include the various ways in which actors emerge as politicised within its context. This concerns ongoing discursive conflicts over both what constitutes ‘good’ global governance (i.e. legitimacy), as well as the changing parameters of how we define ‘trade’ (i.e. its shift from ‘goods’ to include a much wider array of social activities). Civil society has become increasingly visible in global trade governance since at least the late 1980s when, during the Uruguay Round, French farmers protested against what they saw as threats to agricultural markets. Although less visible in the media, it should be noted that in the early 1990s a number of European development groups engaged in strategy meetings as well as lobbying of developing countries to contest what they saw as the threat any expansion of GATT posed to those economies (Wilkinson, 1996). In 1991, Mexico successfully used the GATT’s dispute settlement mechanisms to challenge US legislation banning the import of tuna harvested with nets lethal to dolphin populations. The GATT ruling politicised US environmental groups, which had up to that point operated as nation-­focused organisations. Experiencing the GATT’s reversal of a hard-­ fought victory, many groups now shifted their agenda to include ‘trade’ within their campaign portfolios. This included some public campaigns, but most activity was spent in rapidly developing trade-­specialist units equipped with personnel able to not only read trade agreements, but also publicly address politicians and civil servants in the media on these issues. This process needs to be understood as one of both politicisation, in which new political demands and alliances were formed, as well as socialisation, in which new codes of behaviour and language were adopted. At this point, much happened in North America. In Canada, proposals to create a new trade agreement with the US – the Canadian–United States Free Trade Agreement (CUSFTA) – sparked public controversy during the mid-­1980s, despite exciting little contestation in the US. The Pro-­Canada Network was created, framing CUSFTA as a US takeover – a threat to Canadian cultural and political sovereignty – as well as harming its social and environmental policy. The campaign was unsuccessful in that CUSFTA was signed, but it did achieve a broad network that tapped into the union movement and the church. However, environmentalists and feminists felt largely excluded, used in name but rarely able to influence the campaign (see Huyer, 2004). Certainly, civil society has its own filters, limiting which voices can influence joint campaign statements. Politicisation through CUSFTA meant that Canadian groups were often at the forefront of advocacy critical of negotiations towards the North American Free

Civil society   109 Trade Agreement (NAFTA) in the early 1990s. NAFTA witnessed trilateral networking between activists in all three of the countries involved, though campaigning was largely targeted at US legislators for strategic reasons since it was in Washington that the agreement would either succeed or fail. Trilateral networking allowed groups to enhance their capacity for advocacy, with US groups able to draw upon testimony from Canadian and Mexican groups, who through being seen as important to the US debate, were empowered within their domestic contexts. Where the Mexican government was unwilling to provide information, Mexican groups could turn to their counterparts in the comparatively more open political contexts of the US and Canada to obtain key documents (see Stillerman, 2003; and Hogenboom, 1996). Although the US had a relatively large environmental movement, in the case of NAFTA it was seriously undermined by an internal disagreement – with some leading groups supportive of NAFTA in the hope that any policy harmonisation it facilitated would force new environmental regulations onto Mexico (Dreiling and Wolf, 2001). Again, whilst the campaigners eventually failed to prevent NAFTA, the campaign attracted mass public attention, helped politicise many more types of groups around global trade governance, and left an infrastructure of relations through which further civil society activity might be possible. The first ‘success’ story for civil society came when they took credit for the collapse of OECD negotiations for a Multilateral Agreement on Investment (MAI) in the late 1990s. The head of the Malaysian ‘Third World Network’ (TWN) addressed an event in North America attended by veterans from the two campaigns mentioned above, presenting information that he had been given announcing these negotiations (Johnston and Laxer, 2003). The MAI was seen as a threat because it included the right for corporations to sue governments if new regulations were seen as harmful to their investments. Activists were helped when a Canadian group, with experience from both CUSFTA and NAFTA, was passed a draft of the negotiating text by a Member of the Canadian Parliament. The Canadian group first analysed the report, producing a critical commentary, before distributing both via its network already formed with other North American groups, as well as more globally through relations it was developing through preparations for the WTO’s then forthcoming Seattle meeting. Activists based in national contexts were able to use the texts in their own campaigns, targeted on those issues that made the MAI most politically sensitive within their country. This strategy was particularly successful in France, where the release of the document and a critical analysis that framed the MAI as a threat to cultural sovereignty led to the government withdrawing and, therefore, the negotiations collapsing (Egan, 2001, pp.  88–89; Johnston and Laxer, 2003, pp.  58–59). Whilst as with any such process it remains unclear as to whether civil society was chiefly responsible for the MAI’s collapse, certainly the series of relations developed by the anti-­campaign and the perception of ‘success’ greatly enhanced the politicisation of groups around global trade governance. Through politicisation, a growing array of civil society actors emerged within this policy field, as became clear at Seattle.

110   Michael Strange Seattle was a turning point for the WTO Secretariat, and also for activists. Initially the then-­WTO Director-­General, Mike Moore, tried to distance the WTO from any suggestion that it should do more to ensure economic globalisation could not harm labour rights or environmental protections, by stating, ‘It does not force countries to kill turtles or lower wages or employ children in factories. Put simply, the WTO is not a supranational government – and no one has any intention of making it one’ (WTO Secretariat, 1999). For many environmentalists and activists in the trade union movement, such speeches were patronising and failed to recognise their political demands critical of the WTO beyond a series of simplistic caricatures. Mike Moore’s reference to ‘turtles’ referred to criticism by environmental groups that the WTO threatened US legislation intended to ban shrimp imports fished with nets harmful to turtle populations. Several shrimp-­exporting WTO Member states had filed a complaint against the US and the WTO’s dispute settlement panel ruled that the ban violated WTO rules. There has been much debate on the extent to which the ruling actually undermined environmental legislation, the case won primarily on the grounds that the ban did not apply to the US fishing fleet. However, the WTO ruling did threaten national environmental protections, and as such became a symbolic rallying point for environmentalists to critique the WTO as ‘undemocratic’ (see Dingwerth, this volume). At the same time, a number of cases of child labour abuses and falling labour standards saw trade unions stand side-­by-side with environmentalists – nicknamed ‘turtles and teamsters’ – on the streets of Seattle. National-­level campaigns critical of the WTO were also empowered through having developed increasingly effective relations such that civil society contesting global trade governance had become transnational. Whilst most groups remained wedded to their domestic contexts, their newly developed transnational alliances meant they were able to share critical reports to be used in their own campaigns, as well as sometimes even coordinate strategies so as to target whichever were the most politically sensitive issues within their immediate contexts, but as part of a broader campaign critical of the WTO. Seattle was important for two reasons. First, it made civil society visible as an actor – however disunited – apparently capable of affecting global politics despite lacking any of the conventional (i.e. military, economic) means by which power is understood. Second, civil society was shown to be transnational in scope, in respect to its abilities to organise and act, but also in terms of its political demands. This contradicted the attempts discussed above by the WTO Secretariat to treat civil society – and societal concerns, more generally – as something that could be just managed at the national level with member states guarding political access to the WTO itself. Where these relations led to further networks, such as ‘Seattle to Brussels’, this has enabled a series of later campaigns on, for example, attempts to expand the WTO’s General Agreement on Trade in Services (GATS) (Strange, 2013a) as well as the more recent case of the US-­EU TTIP. None of these campaigns would have been possible in isolation, being dependent as they are on both pre-­ existing alliances between groups and individuals, but also a common frame of

Civil society   111 meaning in which global trade governance is understood as politicised rather than something closed and technocratic. Likewise, civil society groups should not be treated as a homogenous entity but rather a diverse series of conflicting interests. Even where groups share a common critique of, for example, the EU’s Economic Partnership Agreement (EPA) initiative, there has been significant struggle between groups along North­South lines (e.g. Del Felice, 2012). Although by far the most visible civil society groups contesting global trade governance are based in the Global North, groups in the Global South have become increasingly active (Del Felice, 2014; see also Trommer, 2011).

Conclusion Civil society has become increasingly relevant to global trade governance. It exists as both a field of interests relevant to the input stage of policy formation, but also as a normative concept by which to legitimate that form of governance as ‘democratic’ – that is, as responsive to societal concerns. The fact that institutional actors see civil society as important, even where the definition of ‘civil society’ is limited to the constrained ‘NGO’ identity, shows also the extent to which the scope of global trade governance has grown. To cover a growing array of social relations requires legitimacy as well as information. Business associations and lobbying firms can provide much-­needed data but to achieve legitimacy it is necessary to be linked to actors visibly representing societal concerns. The dynamics of discourse at play here, though, mean that civil society is not a pre-­existing actor ready and waiting for consultation when designing policies. Instead, civil society exists in global trade governance as an emergent actor, formed and re-­formed through processes of politicisation in which often diverse political demands become linked through a shared critique of current trade governance. Existing as such, it also means we need to think of civil society and global trade governance not as two separate spheres – an actor interested in a particular policy field, and a series of legal-­political institutions – but as inextricably linked through the social practices in which they are both constituted (Strange, 2013b; Hopewell, 2015 and 2017). Civil society engaged in global trade governance is therefore symptomatic of the broader social construction of how trade is governed in the global context. The example of civil society, as argued here, shows us that the terms we use both to study and also to conduct global trade governance are not neutral or passive. Rather, we see the term ‘civil society’ as inextricably linked within a political struggle over the shape and form of this political domain. Its descriptive function cannot be isolated from its normative connotations because there is no apolitical consensus as to what the term describes (Ní Mhurchú and Shindo, 2016). As seen with TTIP, the struggle over who or what can act as civil society in global trade governance is far from over. Not only do we see active attempts by, in this case, DG Trade to limit access to this political identity; there is another

112   Michael Strange type of exclusion when the WTO Secretariat has been criticised for allowing business associations to be classed as ‘NGOs’. For those activists to whom the term ‘civil society’ is most commonly applied, their political identity depends on being able to mark out practices and demands to which they are opposed. Contestation around the ‘NGO’ label points to not only a struggle for formal access to the WTO, but also how such debates play as sites for broader contestation over the shape of global trade governance. The question of who or what is ‘civil society’ speaks to a much bigger question about which society is represented within contemporary global trade governance, its legitimacy, as well as what alternatives exist to the present order. Through taking time to consider terms like ‘civil society’, we are better able to understand that politics, as well as rethink its future.

Notes 1 Personal observation made at a trade debate between activists and business representatives. 2 Personal interview with a UK trade activist.

References Brown, D., 1999. The battle in Seattle. Guardian, 1 December. Available from: www. theguardian.com/news/1999/dec/01/1 [accessed 16 April 2016]. Del Felice, C., 2012. Transnational activism and free trade. Exploring the emancipatory potentials of global civil society. Voluntas 23, 302–327. Del Felice, C., 2014. Power in discursive practices: The case of the stop EPAs campaign. European Journal of International Relations 20 (1), 145–167. De Ville, F. and Siles-­Brügge, G., 2015. TTIP: The Truth about the Transatlantic Trade and Investment Partnership. Cambridge: Polity. Dreiling, M. and Wolf, B., 2001. Environmental movement organizations and political strategy: Tactical conflicts over NAFTA. Organization & Environment 14 (1), 34–54. Dryzek, J., 2006. Deliberative Global Politics: Discourse and Democracy in a Divided World. London: Polity. Eagleton-­Pierce, M., 2013. Symbolic Power in the World Trade Organization. Oxford: Oxford University Press. Egan, D., 2001. The limits of internationalization: A neo-­Gramscian analysis of the multilateral agreement on investment. Critical Sociology 27 (3), 74–97. Hannah, E., 2014. The quest for accountable governance: Embedded NGOs and demand driven advocacy in the international trade regime. Journal of World Trade 48 (3), 48, 457–480. Hogenboom, B., 1996. Cooperation and polarisation beyond borders: The transnationalisation of Mexican environmental issues during the NAFTA negotiations. Third World Quarterly 17 (5), 989–1005. Hopewell, K., 2015. Multilateral trade governance as social field: Global civil society and the WTO. Review of International Political Economy 22 (6), 1128–1158. Hopewell, K., 2017. Invisible barricades: Civil society and the discourse of the WTO. Globalizations 14 (1), 51–65.

Civil society   113 Huyer, S., 2004. Challenging relations: A labour–NGO coalition to oppose the Canada– US and North American Free Trade Agreements 1985–1993. Development in Practice 14 (1–2), 48–60. Johnston, J. and Laxer, G., 2003. Solidarity in the age of globalization: Lessons from the anti-­MAI and Zapatista struggles. Theory and Society 32, 39–91. Marceau, G. and Pedersen, P., 1999. Is the WTO open and transparent? A discussion of the relationship of the WTO with Non-­Governmental Organisations and civil society’s claims for more transparency and public participation. Journal of World Trade 33 (1), 5–49. Ní Mhurchú, A. and Shindo, R., eds., 2016. Critical Imaginations in International Relations. Abingdon: Routledge. O’Brien, R., and Goetz, A., Scholte, J. and Williams, M., 2000. Contesting Global Governance – Multilateral Economic Institutions and Global Social Movements. Cambridge University Press. Perez-­Esteve, M., 2012. WTO Rules and Practices for Transparency and Engagement with Civil Society Organizations. WTO Economic Research and Statistics Division Staff working paper ERSD-­2012–14. Available from: www.wto.org/english/res_e/ reser_e/ersd201214_e.pdf [accessed 16 August 2016]. Piewitt, M., 2010. Participatory governance in the WTO: How inclusive is global civil society? Journal of World Trade 44 (2), 467–488. Scholte, J.A., 2004. The WTO and civil society, in Hocking, B. and McGuire, S., eds. Trade Politics 2. London: Routledge, 146–161. Scholte, J.A., 2011. Building Global Democracy? Civil Society and Accountable Global Governance. Cambridge: Cambridge University Press. Steffek, J., 2012. Awkward partners: NGOs and social movements at the WTO, in Narlikar, A., Daughton, M. and Stern, R.M., eds. The Oxford Handbook on the World Trade Organization. Oxford University Press, 301–319. Stillerman, J., 2003. Transnational activist networks and the emergence of labor internationalism in the NAFTA countries. Social Science History 27 (4), 577–601. Strange, M., 2011. ‘Act now and sign our joint statement!’ – what role do online global group petitions play in transnational movement networks? Media, Culture & Society 33 (8), 1236–1253. Strange, M., 2013a. A European identity in global campaigning? Activist groups and the Seattle to Brussels (S2B) network. Geopolitics 18 (3), 612–632. Strange, M., 2013b. Writing Global Trade Governance – Discourse and the WTO. Abingdon: Routledge. Strange, M., 2015. Implications of TTIP for transnational social movements and international NGOs, in Morin, J.-F. and Telò, M., eds. The Transatlantic Trade and Investment Partnership in a Multipolar World – Global Impact of an Evolving Transatlantic Relationship. London: Ashgate, 81–92. Sutherland, P., 2005. The Future of the WTO. Geneva: WTO Secretariat. Available from: www.wto.org/english/res_e/publications_e/future_wto_e. [accessed: 16 August 2016]. Trommer, S., 2011. Activists beyond Brussels: Transnational NGO strategies on EU–West African trade negotiations. Globalizations 8 (1), 113–126. Wilkinson, M., 1996. Lobbying for fair trade: Northern NGOs, the European Community and the GATT Uruguay Round. Third World Quarterly 17 (2), 251–267. Wilkinson, R., 2005. Managing global civil society – the WTO’s engagement with NGOs, in Germain, R. and Kenny, M., eds. The Idea of Global Civil Society – Politics and Ethics in a Globalizing Era. London: Routledge, 156–199.

114   Michael Strange WTO Secretariat, 1996. Guidelines for Arrangements on Relations with Non-­ Governmental Organizations – Decision Adopted by the General Council on 18 July 1996. WT/L/162 23 July 1996. Available from: www.wto.org/english/forums_e/ngo_e/ guide_e.htm [accessed 16 August 2016]. WTO Secretariat, 1999. The WTO Is Not a World Government and No One Has Any Intention of Making it One, Moore Tells NGOs. Speech by Mike Moore, WTO Director-­General, given 29 November 1999. Available from: www.wto.org/english/ news_e/pres99_e/pr155_e.htm [accessed 16 August 2016].

8 Coherence Felix Anderl

Introduction A number of international organisations are concerned with regulating the world economy. The most prominent ones are the International Monetary Fund (IMF ), the World Bank Group and, since it evolved from the General Agreement on Tariffs and Trade (GATT), the World Trade Organization (WTO).1 This multiplicity can be problematic. Although they were assigned separate fields of policy, the IMF guarding exchange rates, the World Bank promoting post-­war development and reconstruction, and the WTO promoting and regulating trade, these fields overlap significantly in practice. Hence, the policy of one organisation can affect the effectiveness of the others. Developing countries have often complained, for instance, that their trade performance is severely hampered by their debt and that, therefore, the WTO and the IMF should cohere around a single policy to make domestic trade policies work. The three organisations have a broadly shared conviction, however, namely that the liberalisation of the global economy will lead to advantages for the world’s population and that poverty can be overcome by an interlocking capitalist economic project with increasingly free trade, amplified investment and free movement of labour and exchange rates (see also Auboin, 2007; Sampson, 1998, p. 259; Curtis, 2007, p. 208). It thus might seem ‘natural’ that they work together and aspire towards coherence of their work. This ‘natural’ tendency notwithstanding, the founders of the respective organisations found it necessary to remind future staff members about the importance of coherence: the GATT stipulated that the ‘contracting parties shall seek co-­operation with the International Monetary Fund to the end that the contracting parties and the Fund may pursue a co-­ordinated policy with regard to exchange questions’ (GATT, 1947, Article XV). Coherence also became a formal WTO objective when the organisation was founded. The special relationship with the Bretton Woods institutions was part of its founding impetus: in the final act of the Uruguay Round (see GATT, 1994), the ‘decision on achieving greater coherence in global economic policy-­making’ directly called upon the future Director-­General of the WTO to coordinate policies with the World Bank and the IMF.

116   Felix Anderl But what does coherence do? This chapter shows that the term coherence does more than simply describe the effect of cooperation. It has a productive function, too. In line with Nicholas Onuf ’s (2003, p.  xv) observation that language is a means of world making and thus of power (see Dingwerth and Weinhardt, this volume), the concept of coherence serves specific purposes and interests within the global trade regime. It is, additionally, functional as a rhetorical device. First, coherence seemingly does not hurt anyone because its vagueness allows most actors to subscribe to it. Second, coherence silently excludes possibilities of a different economic system by integrating already existing policies across international organisations as I show empirically in an analysis of the WTO Secretariat’s practices aiming at coherence. Based on this evidence, I therefore argue in this chapter that, in principle, the term has had a stabilising effect on the status quo. Despite that, coherence is also used as a concept by poor states and advocacy organisations in their attempts to criticise existing trade rules. What does coherence do for them? In an analysis of statements at GATT and WTO Ministerial Meetings, I find a surprisingly robust trend: while OECD countries tend to use coherence as a conservative rhetorical tool by using it in a self-­explanatory and unspecified way (coherence of the status quo), developing countries tend to attach specific, and potentially challenging, policy goals to the term (coherence of trade with other policy goals). In order to understand these different usages of the term, I map the critical potential of coherence and develop a four-­field matrix of how coherence can (and cannot) be used by critics of current economic governance. I argue that, despite its conservative tendency, coherence can function as a weapon for less powerful states to hold the WTO accountable to its prior promises (internal critique). Such criticism usually refers to already existing policies and cannot suggest outside norms or refer to other values (external critique). The concept of coherence is therefore likely to be used by moderate critics. Yet, there is still the more progressive possibility to highlight the WTO’s commitment to coherence with issues outside of trade such as development or environmental protection. I call this coherence between trade and non-­trade issues comprehensive in contrast to narrow coherence focused on the absence of conflicts or contradictions among different aspects of trade regulation. The chapter thus makes sense of different meanings of coherence and thereby shows how language makes and reaffirms world trade politics: poor states can buy into a specific language by using the term in order to criticise existing policies. They make progressive claims by employing ‘comprehensive coherence’. More powerful states as well as the WTO bureaucracy, in contrast, refer to ‘narrow coherence’, thereby reaffirming the conservative tendency the term has acquired in the broader world trade discourse.

Coherence   117

Mind mapping coherence in global trade governance In the following, I map the major ways in which coherence has come to be understood in the discourse about world trade politics. Examining the rhetorical function of coherence, I distinguish two possible functions of the term, relate them to the WTO mandate and argue that only one form has been applied systematically by the WTO Secretariat. Against the backdrop of this dominant understanding, I discuss and systematise the potential for alternative usages of coherence. Coherence as a conservative rhetorical tool Andrew Lang (2011, p. 130) convincingly shows that the language of coherence in neoliberal economic governance has led the logic of free trade to dominate other concerns such as the environment under its frame. This framing has been running smoothly because, inter alia, it is hard to oppose the positively connotated idea of coherence, a term that largely functions as an empty signifier. This term stems from language theory, broadly claiming that there is a signifier that represents (carries the meaning), and the signified, that which is being represented (de Saussure, 1959). Coherence qualifies as an ‘empty’ signifier for it often remains unclear what the signified should actually be. Furthermore, the term is particular, while simultaneously claiming to represent a whole, or something general, which is the more complex definition of an empty signifier (see Nonhoff, 2007, p. 13). My purpose here, however, is not to defend the claim that coherence is an empty signifier. Rather, I want to illustrate that it can function as such and, more broadly, has been used as a rhetorical tool in governance. Thus, the concept of coherence is illustrative for how hegemonic constellations can actualise themselves through reference to a specific language. It looks like an external concept, as something that can empower criticism of the status quo, but actually re-­inscribes that which the hegemonic order already represents. Boltanski (2011: 118) has even argued that ‘what should prompt identification of a situation as pathological is therefore … the maniacal quest for coherence, as if it were possible for human beings to live in a single world and, all together, always in the same one’. Demanding coherence fundamentally builds on a prior consensus, since without a consensus on what to cohere, the concept is dysfunctional. This is also where Ernesto Laclau and Chantal Mouffe (2001, p. xviii) allocate the political function of empty signifiers: ‘any form of consensus is the result of a hegemonic articulation, and … always has an “outside” that impedes its full realization’. Referencing coherence without further explication appears to be the textbook example of a rhetorical tool that implies consensus on an issue and temporarily includes potentially disruptive voices (‘the outside’) by hinting at an allegedly common project. In that vein, Alan Winters (2004; 2007), an economist in charge of negotiating coherence with the WTO and the IMF when working for the World Bank,

118   Felix Anderl argues that coherence is used at random. When coherence is defined as ‘a situation in which different policies pull in the same direction, or at least, do not pull in different directions’ (Winters, 2004, p. 331), it is easy to agree that this would be a desirable situation. However, the concept hides that the real matter is in the question in which direction to pull. As long as this question is answered equivocally, ‘[it] is basically non-­operational because it defines no joint issues or positions around which to cohere. Rather, it is a rhetorical device’ (Winters, 2004, p. 329). From his experience, he recalls that he ‘spent a lot of time, as did my friends and colleagues in all three organisations, wondering what coherence was all about’ (Winters, 2004, p.  330). Under this condition, the WTO Secretariat instead focuses on ‘low-­level, ad hoc cooperation [which] has helped the institutions present a coherent public face’ (Bernstein and Hannah, 2011, p. 14). Coherence thus works as a rhetorical tool because it can sell different kinds of policies under its frame to which, in principle, even sceptics subscribe. For environmentalists and development NGOs who are told that the Bretton Woods institutions and the WTO seek coherence, for instance, it seems promising to support this course of action. They could hope for the possibility of the World Bank having a more development-­oriented focus and thereby being more vigorous than the WTO Secretariat in abolishing some perverse side-­effects of prior pro-­ market policies in conflict with goals like human development or sustainability (see e.g. Oxfam, 2010). Their temporary inclusion into the hegemonic discourse is the effect of this rhetorical tool. Narrow and comprehensive coherence To assess whether coherence serves as a conservative rhetorical tool, I will in the following examine the concept’s function in the global trade regime. For this, we need to distinguish several possible functions. In the Oxford Dictionaries, two definitions are given for the term.2 First, coherence is defined as ‘the quality of being logical and consistent’. Second, coherence is understood as ‘the quality of forming a unified whole’. To start with, there are different scales of coherence within international trade. I suggest a broad distinction between narrow and comprehensive coherence, the former standing for coherent rules, procedures and implementation within trade, the latter encompassing other policy fields which trade should be coherent with. Narrow coherence makes a concept that aspires to integrate various policy fields to make trade itself work. Even if this goal were to be reached, however, policies could still be incoherent from a broader perspective, for example if an integrated trade framework ‘works’ with respect to trade but leads to negative side-­effects (externalities) in other areas which contradict the Bretton Woods institutions’ position, such as in the environment. In the preamble to the WTO Agreement, free trade was not set up as an end in itself, but a means to achieve sustainable development, and ‘seeking both to protect and preserve the environment’ (WTO, 1994a). Therefore, cross-­issue coherence would have to start with a multidimensional analysis and seek the coherence of trade

Coherence   119 with issues outside the trade field, explicitly targeting externalities from trade that undermine the performance of neighbouring international regimes. This is what I call comprehensive coherence. The WTO’s coherence mandate corresponds with both these definitions. In practice, however, the rhetoric of the WTO has almost exclusively emphasised narrow coherence. This can be exemplified with the problems that occur when narrowly coherent trade policies collide with other issues such as the environment (see Lydgate, this volume). The classical example for such a collision is the Tuna–dolphin case in the early 1990s, when Mexico (a major tuna exporter) brought the US to the GATT dispute settlement body. The US had banned the import of tuna from the Eastern Pacific that was caught without devices to save dolphins. The panel found that the US violated GATT rules because it discriminated against goods with a specific method of production (see Steffek, 2012, p. 336). The decision did not only infuriate environmentalists, but also hinted at a major problem of a trade policy’s coherence with other desirable public goods, in this case the protection of endangered species and animal wellbeing. As I outline in the following, although the WTO’s work is mainly concerned with a narrow conceptualisation of the term, both narrow and comprehensive coherence have a grounding in the WTO’s coherence mandate. The coherence mandate On a rather technical level, the WTO’s internal coherence is meant to promote policies that do not contradict existing policies, and thus send clear signals to the implementing member states. More holistically, the mandate is fundamentally about integrating trade, finance and aid policies, thus it integrates the work of the multilateral trade regime and the Bretton Woods institutions into a unified whole. Not only does the WTO aspire to cooperate with the World Bank and the IMF, the aim to achieve greater coherence is an essential part of the organisation’s objective (Bernstein and Hannah, 2012). Therefore, Article III.5 of the WTO Agreement lists coherence as one of the five core functions of the WTO. This coherence function of the WTO was formally explicated in the Declaration on the Contribution of the World Trade Organization to achieving greater Coherence in Global Economic Policymaking (WTO, 1994b, p. 387),3 in which the member states have agreed on five cornerstones of coherent global economic policymaking. First, they reiterate the positive role of liberal trading policies for growth and development. For this, they, second, invoke a classical neo-­ functionalist image of spill-­over effects when arguing that ‘successful cooperation in each area of economic policy contributes to progress in other areas’ (WTO, 1994b, point 2). Third, the member states specify that the contributions towards coherence in the Uruguay Round will lead to market expansion, more transparency, effective surveillance and an increasingly open trading system. The empirical fact of overlapping regimes, combined with the alleged improvements that have already been achieved with regard to coherence are held as a foundation for trade policy ‘to play a more substantial role in ensuring the

120   Felix Anderl coherence of global economic policymaking’ (WTO, 1994b, point 3). The WTO is thus not only responsible for doing its part while the World Bank and the IMF do theirs. Much more, trade is described as the overarching theme for integrating the world economy. This shall mainly be achieved by more surveillance and a stricter observance of multilateral rules. Fourth, however, it is acknowledged that trade alone cannot solve every problem outside the field of trade, which again requires effective cooperation with the Bretton Woods institutions. Therefore, point five requires the institutions to ‘follow consistent and mutually supportive policies’ (WTO, 1994b, point 5). The Director-­General is asked to coordinate with the Managing Director of the IMF and the President of the World Bank to settle on a common understanding of responsibilities and forms of cooperation. The Secretariat’s narrow understanding of coherence What development has the term coherence undertaken since the outlined mandate was agreed on? While the WTO constantly guards and monitors its own member states and has strong institutional proceedings to do so (‘the quality of being logical and consistent’), it looks rather haphazard when it comes to coherence with other regimes (‘the quality of forming a unified whole’). The mandate, however, makes explicit that both forms are required for achieving the objective of coherence. Regarding the former quality, for instance, the Committee on Specific Commitments was set up in 1996. It has the mandate to ‘oversee the implementation of WTO members’ services commitments and, in particular, to ensure their technical accuracy and coherence through regular examination of classification and scheduling issues’ (WTO, 1996, p.  68). These technical procedures are comparably easy to implement because there are common rules that the bureaucracy can refer to. In contrast, the comprehensive conceptualisation of coherence which is equally rooted in the mandate has not been alluded to systematically. Since it was founded, the WTO has approached the goal of a liberalised economy by trying to integrate policy approaches with other international organisations to make trade work. Since 1995, cooperation has widened and institutional priorities have shifted towards this issue (see Bernstein and Hannah, 2012, p.  782). The WTO Director-­General produces annual reports on the progress in coherence (WTO, 1997) and a number of forms of cooperation between the economic institutions have been organised since then. For instance, the WTO exchanges data with the IMF, the World Bank, some United Nations agencies and the Organization for Economic Cooperation and Development (OECD). Furthermore, there is some cooperation with regard to overarching international programs such as the Millennium Development Goals. Beyond data exchange, however, such initiatives are rather ad hoc and, as the WTO reports, ‘more disaggregated and focusing on specific … commitments’ (WTO, 2011, p. 8). In 2001 in Doha, the WTO ministers further decided to establish a Working Group on Trade, Debt and Finance. Its purpose is to find ways for the WTO to

Coherence   121 contribute to solving external debt problems of developing countries and instabilities in the financial sector. The meetings of this working group currently constitute the main WTO activity of seeking institutional coherence with other international organisations (WTO, 2015b, p.  85). Apart from these meetings, there are some running programs and initiatives which cut across organisations, for example the trade finance facilitation programs which are implemented with multilateral development banks and are supposed to increase trade finance. For the African continent, the WTO for example cooperates with the African Development Bank (AfDB) to provide credit guarantees for traders who could otherwise not access international markets. Within these programmes, AfDB and other multilateral development banks have spent approximately US$20 billion of trade transactions in poor countries, ‘which would not have received support from private markets’ (WTO, 2015b, p.  85). According to the minutes of the working group, these programmes were ‘not designed to eliminate all market gaps’, but instead ‘to [allow] SMEs [small and medium-­sized enterprises] and banks locally to engage into international trade, thereby building capacity and experience’ (WTO, 2016). This limitation is also a matter of debate within the working group. Brazil, for instance, criticised in a 2014 meeting that ‘there was a need for the WTO to “dig” deeper about its own role, based on the coherence mandate’ (WTO, 2014). To further grasp the logic in which the WTO has been approaching coherence, the ‘Aid for Trade’ initiative serves as good example. According to some observers (see Hoekman, 2012, p. 767), the initiative sets up a case of fulfilling the coherence mandate, whereas others are more sceptical (Langan and Scott, 2014). The idea of ‘Aid for Trade’ is to assist developing countries, especially Least Developed Countries, so that these can ‘build the trade capacity and infrastructure they need to benefit from trade opening’ (WTO, 2015c). The initiative is based on the belief that poor countries could strongly profit from trade and lift a big number of people out of poverty through new trade opportunities. However, these countries have in the past not profited as much as WTO officials had hoped for. One of the reasons is the reluctance of industrialised countries to open their markets. As the WTO argues, there are also problems on the ‘supply-­side’: internal barriers to trade that are spotted in ‘lack of knowledge, excessive red tape, inadequate financing, poor infrastructure’ (WTO, 2015a). The ‘Aid for Trade’ programme, financed through official development assistance, is therefore geared at tackling these issues. The WTO encourages donors to fund trade-­related capacity building and works directly with developing countries to make sure trade will be assigned a more prominent place in national development plans. The mechanism to access ‘Aid for Trade’ is the Enhanced Integrated Framework (EIF ). This mechanism assists developing countries in prioritising key needs for trade-­related assistance and capacity building, and submits these needs to donors to generate additional funding. The EIF is thus an access mechanism which identifies specific activities and approaches for economic integration. The resources for these undertakings have to be tapped from other sources. Although

122   Felix Anderl it takes issues other than trade into account, the aim of the initiative thus is to make trade itself more efficient. Overall, while the coherence mandate asks for a more holistic view on economic problems, its implementation remains sporadic and limited to ‘narrow coherence’. In the following section, I examine why the WTO has not gone beyond this ‘limited success of promoting macroeconomic consistency in the global economy’ (Bernstein and Hannah, 2012, p. 777). Coherence as a weapon? Internal and external critique To understand why the term coherence has a conservative tendency in global economic governance, especially when applied in such a narrow fashion, it is useful to see what avenues of critique are opened up by different potential usages of the term. I do this by introducing the distinction between internal and external critique.4 Internal critique is a mode of arguing that remains within the margins of the criticised order. The critic is part of – or acts as if she was part of – the thought structure that she grapples with. Therefore, she does not need external theoretical or ethical yardsticks. Rather, the yardsticks are found in the norms that the criticised actors themselves represent. Most often, internal critique hints at contradictions between theory and practice: practice A of a specific actor does not correspond with the norms previously endorsed by this actor.5 Internal critique thus commonly takes the form: ‘hey, before you said B and now you do A!’ External critique on the contrary receives its norms not from the criticised actors but either from third actors or from supposedly universal norms. The external critic challenges an actor because she thinks the actor should be oriented around this or that norm. We find this, for example, in the human rights discourse when actors are criticised for violating human rights to which they might not even subscribe. In this case, external critique takes the generic form: ‘hey, you do A, but according to B this is wrong!’ Internal critique has the merit of getting the criticised actors on board. In contrast to external critique, it does not hold universal norms against a specific practice and thus does not tell an actor what she should be doing. Rather, it measures actors’ practices against their own previous commitments. In contrast to external positions, however, it is very difficult to create innovation with this mode of critique, for in practice an actor can only be held accountable to something to which she has already subscribed. Arguing with the concept of coherence in trade is usually the application of internal critique. The WTO has officially subscribed to coherence and therefore critics can make use of this norm and remind WTO officials of their prior promises. What the critics really want might be much more radical, but they sense that any external critique like ‘You should make sure trade liberalisation does not interfere with efforts to mitigate global warming, because it would be the ethical thing to do’ will fall on deaf ears at the WTO. Wilkinson (2014) therefore emphasises the question: coherence with what? In his opinion, the calls for more

Coherence   123 coherence by civil society have no decisive effect on the WTO, because making an unfair system more coherent would ‘certainly fail to address the issue of bargaining among unequals’ (Wilkinson, 2014, p. 150), a situation that he sees as the major obstacle to fair trading rules. This is the cost of internal critique: critics buy into a certain logic to make arguments ‘from within’, but arguing based on norms that are external to that logic does not work from such a speaker position. Internal critique has the advantage of enabling a constructive discussion between the WTO bureaucracy and its critics (or between member states), but has little transformative potential. This trade-­off lies at the heart of many civil society strategy dilemmas (see Strange, this volume). The potential of coherence Referring to coherence within global trade governance can support different forms of statements (see Table 8.1). Since complete coherence is never fulfilled, alluding to it usually entails a demand. The most straightforward one is to ask for narrow coherence. This means demanding a trade policy that is internally coherent, which means logical and consistent. The WTO is already guarding internal coherence by monitoring member states and by cooperating with other international organisations on trade-­related matters. One could argue that it is the minimum function of the WTO to establish coherence within trade. Seen comprehensively, the WTO would not only have to work on ‘trade-­ related’ issues with other agencies, but also make sure that the other (‘non-­trade’) goals will not be negatively affected by trade rules and practices. A more challenging critique to trade governance thus requires at least some elements external to trade. Directed at countries’ policies, this is a common move for critical actors from civil society. With regard to development policies, for instance, Oxfam has demanded that ‘[d]onors need to quickly provide adequate resources … and should ensure greater coherence between their development assistance and trade policies’ (Oxfam, 2010, p. 1). The structure of this critique is more comprehensive, because it asks the criticised actor to create coherence between the trade policy and other policies, which may, in effect, lead to less or different kinds of trade compared to a situation in which such cross-­policy coordination were not undertaken. In contrast to the WTO’s application of the term, the width of the coherence mandate theoretically allows for a demanding approach. Critique can be framed with reference to the coherence mandate, the logic of which almost all affected actors and audiences will endorse. The call for cooperation with the IMF and the Table 8.1 Forms of coherence Internal critique

External critique

Within trade

Narrow coherence

–

Trade with other issues

Comprehensive coherence

Beyond coherence

124   Felix Anderl World Bank can be an access point for references to public goods that these organisations stand for, such as human development. Additionally, Point four of the declaration could be a reference point for critique, as it acknowledges that trade alone cannot solve every problem outside the trade field. Part five of the declaration adds a further gateway for demanding comprehensive coherence; it requires the WTO to follow consistent and mutually supportive policies with other institutions whose policy goals can therefore be drawn upon in order to make claims. Yet, even though the demand for comprehensive coherence is a more progressive challenge than the demand for narrow coherence, challenges that ask the WTO to take environmental concerns (or the like) into consideration remain within the logic of internal critique because they measure the WTO against its own norms, not against norms that were derived from outside. Whether demanding narrow or comprehensive coherence, both are moves of critique that aspire to make the WTO fulfil its own mandate. Can coherence also be an access point for external critique? This would imply taking the broadened conception of comprehensive coherence as a starting point and making progressive claims that refer to norms outside the world of trade. This is in principle less promising for reaching the approval of actors within the WTO, since it implies a different logic of argument, one that takes its reasoning from fields other than trade. Moreover, arguments from outside the trade regime and its logic, such as human rights claims, have frequently mobilised against trade policies (see e.g. Claeys, 2013, p. 4), thus making it unlikely to find much support among the trade policy community. To persuade at least a significant share of that community, an argumentative chain would thus need to go beyond coherence and convincingly demand that trade policies cohere with something the WTO does not stand for. Ultimately, the strength of coherence thus remains with internal critique. This also means that for radical positions, coherence is probably the wrong argumentative instrument. Nevertheless, charges of ‘hypocrisy’, ‘inconsistency’ and ‘incoherence’ can be potent tools for a critique that does not come across as overly radical. For such a criticism to have transformative potential, the objective of comprehensive coherence is most promising, since it goes beyond the logic of trade alone and yet has grounding in WTO’s mandate and rhetoric.

Meaning makers: how coherence is used as a rhetorical device From the discussion in the previous section, we get the impression that coherence works as an empty phrase in the world trade discourse that serves to legitimate the status quo by dispersing critique. Nevertheless, I outlined that it is conceptually possible to bring forward substantiated and progressive arguments with reference to the term. But how do the proponents of coherence actually refer to the term when they draw on it? To answer this question, this second part of the chapter evaluates the contexts in which member states refer to coherence in their statements in GATT

Coherence   125 or WTO meetings between 1973 and 2013. The coding encompasses statements using the signal words ‘coherence’, ‘coordination’ and ‘cooperation’, as well as statements that refer to ‘relations with other international organizations’.6 It is illuminating to have the other phrases in the coding, since this also shows whether parties make reference to the Declaration on Coherence without using the term (which may tell us something about the term). I use a selection of statements which were coded as ‘coherence’ for another project.7 Within this sample of 70 statements – 29 by OECD countries and 41 by non-­OECD countries – I sub-­coded alongside two main categories: ‘with what?’ and ‘with whom?’.8 This helps to identify, first, what issues the member states have in mind when they want the trade policy to be coherent with something else. Second, it illustrates with which other organisations member states want the GATT/WTO to attain coherence. In the following, I outline the main trends, highlighting the significance of development, social policy and environmental policies, and the role of other international organisations, especially the IMF, the International Labour Organization (ILO) and the World Bank. In general, the analysis illustrates that coherence is a broadly shared and virtually uncontested goal. However, looking at who demands what, we can also see that OECD countries tend to use coherence as a conservative rhetorical tool while developing countries tend to attach very specific, and potentially challenging, policy goals to the term. Coherent with what? What policies do GATT Contracting Parties and WTO members want trade policies to be coherent with? The coding of their statements suggests that the issue that they by far care most about is ‘development’ (23 mentions, see Figure 8.1). The category that comes closest is ‘coherence terms’ which encloses all mentions of ‘coherence’ and ‘coordination’ without explicating what this should mean. Further frequent issues are social policy (13 mentions), debt/indebtedness, the environment, and fiscal and monetary policy (all 11 mentions). Remarkably, it is especially the poor countries that connect their demands for coherence with concrete and issue-­related problems. They make clear that trade Coherence with what? No. of statements Agriculture Coherence terms Debt/Indebtedness Development Environment Export/Commodities Fiscal/Monetary policy Free trade/more trade/more discipline Social policy

Figure 8.1 Coherent with what?

4 16 11 23 11 2 11 4 13

126   Felix Anderl alone will not help their economies: ‘[t]he debt problems of developing countries call for more and effective co-­operation between GATT and financial and development institutions’ (GATT, 1989a). Coherence comes in as a policy answer to the interconnectedness of problems that the developing countries face. An analysis of the coded passages reveals the centrality of development concerns in these calls. As was stated by a Singapore representative (WTO, 2001), at the beginning of the Doha Round, ‘negotiations must have a strong development focus and require, as a precondition, the building up of capacity in developing countries. Sweet words are not enough. There must be binding commitments to such efforts’. The representative also stated that ‘[t]o be practical, the WTO should make use of existing international facilities like the World Bank and not seek to replicate them’. Coherent with whom? When it comes to the practice of coordination, several organisations are named by the GATT Contracting Parties and later WTO member states. The IMF is mentioned most frequently by far. As a second category, although the World Bank somewhat surprisingly is only mentioned seven times, there are numerous references to ‘international development banks’ (see code ‘unspecified’ in Figure 8.2). Furthermore, the ILO receives some attention (seven mentions), as do the United Nations Conference on Trade and Development (UNCTAD) and the Food and Agriculture Organization (FAO). The focus on these organisations fits well with the specific issues mentioned, although the environment seems not to have a natural institution which the WTO could cohere with in the eyes of the member states. While development is matched with the World Bank and other unspecified development banks, social policy with the ILO, debt/indebtedness, and fiscal/monetary policy with the IMF, the longing for coherence with environmental concerns is not matched – as could have been expected – by a high number of mentions for the United Nations Environmental Program (UNEP). Coherence with whom? Commodity Councils FAO ILO IMF OECD UN UNCTAD UNEP World Bank World Food Council Regional trade agreements Unspecified

Figure 8.2 Coherent with whom?

No. of statements 1 3 9 20 1 1 4 2 7 2 3 19

Coherence   127 Disaggregating the results When disaggregating these findings, one can see more clearly that calls for coherence with a specific policy field such as the environment, or with a specific problem such as external debt, come almost exclusively from ‘developing countries’, while OECD countries tend to remain with a broader frame of ‘more coherence’, without specifying what this would mean in practice. I interpret this observation as support for my assumption that rhetoric on coherence can function as a governing tool. On this reading, powerful states cement their relative position by constructing discourses around an empty concept which obscures the differences within the WTO membership. However, I refine this argument by the empirical observation that some, mostly poor, countries use the concept as a means to change existing trade policies. Take the code ‘debt/indebtedness’ as an example of a specific usage, and ‘coherence terms’ as an example of the most abstract, least specified use. While debt/indebtedness comes entirely from low-­income countries, the code ‘coherence terms’ – which demands coherence without attaching it to a specific actor or issue – is mostly OECD-­driven. OECD countries feed into this code by acknowledging that ‘[i]n today’s globalized and interlinked world we need more coherence’ (WTO, 2009). Developing countries, on the other hand, make up the more specific codes like ‘debt’, or ‘development’. In the Uruguay Round (1986), for instance, Cuba (GATT, 1986a) complains that ‘the huge external debt of the developing countries has become an insurmountable barrier to the economic development of those peoples which listen to the fairy tales of trade liberalization with justified indignation’. Bangladesh (GATT, 1986b) hints at the ‘problems of a large number of indebted developing countries, negative effects of prolonged financial and monetary instability in the world economy and linkage between trade, money and finance, and development’. Similar statements were made by representatives from Peru (GATT, 1986c), Jamaica (GATT, 1989b), Egypt (GATT, 1989a), Tanzania (GATT, 1992) and Argentina (GATT, 1975). Developing countries often either use additional specifications when referring to the term coherence or apply other terms that were coded here within the broad category of coherence (for example ‘linkages’ above) to make a more specific point. In general, a closer look at the coded segments therefore shows three things. First, as expected, the promotion of coherence has been virtually uncontested in the world trade regime. No state ever suggested creating a less coherent trade regime, and no state ever received negative feedback in response to arguing in favour of more coherence. Second, powerful states apply the term in very general ways, without explicating what it means or connecting it to specific issues or actors. Third, poor countries tie the call for coherence to more specific claims or use different terms that do not explicitly invoke, but support the idea of comprehensive coherence.

128   Felix Anderl

Conclusion Coherence is a fundamental part of the WTO’s mandate. The Declaration on Coherence explicitly asks the organisation’s Director-­General to work closely with the IMF and the World Bank, and Article III.5 of the WTO Agreement lists coherence as one of the five core functions of the WTO. In institutional practice, however, I have argued in this chapter, coherence mainly works as a rhetorical tool which supports the stabilisation and integration of prevailing discourses around trade. Looking at the WTO’s practices in the field of coherence, we can see that the coherence mandate is interpreted in narrow terms. The example of trade finance, which is the core item around which the WTO organises its coherence efforts, further shows that WTO members are currently not willing to cohere around a common policy with other organisations, but rather use others for championing their own agenda. I call this ‘narrow coherence’ (coherence within trade). Applying coherence in such a way has a conservative tendency since it only reinforces what is already there. In contrast, I have argued that a comprehensive understanding of coherence – trade’s coherence with other public goods – has a progressive potential. Applying coherence in this more comprehensive way is, furthermore, also covered by the WTO’s coherence mandate. Drawing on an analysis of how the GATT Contracting Parties and WTO member states utilise coherence, I showed that OECD countries tend to use the concept narrowly and hence in accordance with my reading of coherence as a conservative rhetorical tool. Developing countries, on the other hand, connect the concept to concrete criticism of actual policies and make specific references: to criticize their external debt, for example, or the counter-­productiveness of free trade policies under such circumstances. I argue that an external critique which builds on norms outside the trade regime has less chance of being understood by the trade politics community ‘on its terms’. For demanding coherence with issues outside trade, critics must produce more complex argumentative chains. The distinction between narrow and comprehensive coherence I developed in this chapter may therefore help future advocacy efforts to frame their demands for coherence of trade with other issues in creative ways that resonate within, but ultimately go beyond, common conceptions in the trade regime: in terms of a system-­wide coherence that does not subordinate development, human rights or the environment to trade expansion, but instead gives consideration to a broad range of policy goals.

Notes 1 I would like to thank Johannes Haaf, Regina Hack and Katrin Mauch as well as the editors, Klaus Dingwerth and Clara Weinhardt, for their valuable comments on earlier versions of this chapter, and Philip Wallmeier for our discussions on critique as a social practice. 2 See online at: www.oxforddictionaries.com/definition/english/coherence [last accessed 7 December 2015]. 3 In the following: Declaration on Coherence.

Coherence   129 4 This section profited from collaborative work on an article with Philip Wallmeier (see Anderl and Wallmeier, 2018). 5 The most prominent proponent of internal critique is probably Walzer (1987). 6 The coding is based on the summary records from 1973 to 1979, the Member State Statements of 1986, 1989, 1990, 1991 and 1994, as well as the first 50 statements of the Ministerial Conferences 2001, 2003, 2005, 2007, 2009, 2011 und 2013. 7 This coding was undertaken by Klaus Dingwerth and Ellen Reichel at the University of St. Gallen, Switzerland within the research project ‘Changing Norms of Global Governance’. I am grateful for their kindness in sharing the material. 8 I executed the coding with MAXQDA, generating an overall of 108 coded segments among which 87 relate to specific agencies (‘who?’) and 95 refer to specific issues (‘what?’) (a double coding of segments was possible). The OECD-­membership (or non-­membership) always refers to the time of the statement.

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9 Development Clara Weinhardt and Angela Geck

Introduction At the World Trade Organization’s (WTO) annual Public Forum in 2016, the Nigerian Trade and Investment Minister Okechukwu E. Enelamah1 commented that [c]ountries do not engage in trading relationships for the sake of trade per se.… The immediate and ultimate goal of trade is growth and development. This is why the WTO and its membership must make trade and the rules of trade count for development. (Buhari, 2016)2 Since the negotiations on the doomed International Trade Organization (ITO) in the post-­war era and the conclusion of the General Agreement on Trade and Tariffs (GATT) in 1947, the international trade regime has been confronted with calls to address the concerns of developing countries (Alessandrini, 2010). These calls have, over time, led to the incorporation of a number of development-­ related provisions into the legal architecture of the GATT and the creation of the United Nations Conference on Trade and Development (UNCTAD). After the birth of the WTO in 1995, its first negotiating round – launched in 2001 – was named the ‘Doha Development Round’. Despite the prominence of the term, developing countries continue to lament their marginalisation in the world trading system. To understand this apparent contradiction, this chapter traces the evolution of the discourse on development in the world trading system, and how it has affected the institutionalisation of ‘development-­friendly’ trade rules along the way. In doing so, we present two main arguments. First, a key to understanding the emergence and the changing meanings of development in the world trade regime lies in the waxing and waning of different theories of economic development (Alessandrini, 2010; Lang, 2011). The turn in economic development theory from dependency theory to neoliberalism in the 1980s shifted the focus of the discourse from demands to change unfavourable world market structures to the need to liberalise the economic policies of developing countries. We argue that – despite rising criticism of neoliberal approaches to economic development from the 1990s onwards – these ideas continue to

Development   133 shape the discourse on development in the WTO era. As a result, developing countries have increasingly become subject to the same rules as developed countries because the central concept of Special and Differential Treatment (S&D) for developing countries has been re-­defined in narrower terms. Initially, the focus of S&D measures lay on preferential market access and substantive exemptions from new rules on trade liberalisation. Over time, support for granting these kinds of measures to all developing countries has declined and S&D has come to primarily imply longer transition periods and capacity building measures. Second, we demonstrate that in the most recent WTO era, the debate on differentiation within the developing country bloc has come to dominate the discourse on development. Developed countries increasingly contest that emerging countries, such as Brazil, India and China, continue to belong to the group of developing countries entitled to S&D. We argue that this shift in discourse not only reflects greater heterogeneity among the group of developing countries, but also a greater emphasis on specific economic criteria as a basis for determining developing country status in the WTO. While differentiation is not necessarily detrimental to developing countries, the unresolved stand-­off between emerging and developed countries over classifications increasingly delegitimises the calls of other developing countries for special rules regarding developing countries as a group. The evolution of meanings associated with the concept of development in the world trade regime, which a constructivist analysis of language reveals, helps us to better understand why many developing countries continue to be frustrated by WTO rules on development despite the great attention the issue receives. Greater strength in numbers, and in the case of emerging countries in market size, alone does not guarantee that development concerns are addressed in a more comprehensive manner in the world trade regime. It matters not only that the development term has entered the ‘vocabulary’ of the world trade regime, but also what it means to introduce development-­friendly trade rules, who they apply to – and who is excluded. The new ‘social reality’ (Adler, 2013, p.  125) created by the rise of neoliberalism has limited the range of legitimate demands for S&D, a move to which some developing countries strongly object. This perspective stands in contrast to those scholars who assess the value of different forms of S&D on the grounds of presumably objective economic theory (Hoekman, 2006), without paying attention to the influence of particular meaning makers, whether from developed or developing countries, that shaped the rise and fall of different economic theories in the first place. In addition, the evolution of new socially constructed actor positions (Foucault, 1972, pp. 50–55) within the group of developing countries, including emerging economies, restricts many countries’ perceived eligibility for S&D. As a result, the rise in power of emerging countries does not necessarily mean that the concerns of developing countries have greater weight in the world trade regime, as some scholars have suggested (Narlikar, 2010, p.  720; Nel, 2010, p.  969). Instead, unresolved struggles over where to draw the boundary of the

134   Clara Weinhardt and Angela Geck developing country status, and whether to include or exclude emerging countries, have restricted the ability of emerging countries to play the role of advocates for more ‘development-­friendly’ rules. To trace the changing meaning of development, we analyse official documents and political debates within the world trade regime (Bukovansky, 2010, p.  28). We combine secondary sources with the analysis of primary sources, including a sample of 851 statements made by country representatives and other speakers during the negotiations of the Tokyo (1973–1979), Uruguay (1986–1994) and Doha (2001–2013) Rounds.3 Moreover, we draw on selected qualitative interviews conducted with trade policy officials in Geneva in 2010 and 2016.

From dependency theory to neoliberalism: the redefinition of special and differential treatment for developing countries The salience of the development issue within official statements from the trade regime has grown constantly: ‘development’ was mentioned 1.2 times per statement during the Tokyo Round, 2.2 times per statement during the Uruguay Round and 5.1 times per statement during the Doha Development Round. The meaning of the term development in the trade regime, however, is not fixed, but closely linked to particular sets of historically contingent ideas, ideologies and beliefs. In particular, economic theories of development have played a crucial role in shaping the language of development in the trade regime. While in the 1960s and 1970s the prevalence of dependency theory facilitated and shaped the introduction of S&D for developing countries into the GATT rules, from the 1980s onward the predominance of neoliberalism has led to a redefinition of this concept in narrower terms. Over time, these changing meanings have shaped what kinds of ‘development-­friendly’ rules are conceivable and desired in the world trade regime. We argue that neoliberal ideas continue to define the kinds of demands that developing countries can make in the trade regime. The notion of ‘underdeveloped’ nations emerged as part of the restructuring of the global order after the Second World War between 1945 and 1955.4 In line with the emerging discourse on development, countries like India, Brazil and Chile pushed for rules that addressed the particular needs of developing countries in facilitating economic growth during the negotiations over the ITO charter between 1946 and 1948.5 They succeeded in including development-­related exceptions from liberalisation commitments like infant industry protection in the ITO charter; some of which were also integrated in the GATT (Hudec, 2011, pp. 31–32; Lang, 2011, p. 26). However, these provisions were not restricted to a particular group of countries. The original GATT text contained no special treatment for developing country members (Jupille et al., 2013, p. 132). It was only in the 1960s and 1970s that developing countries succeeded in introducing a special set of rules for developing country members into the GATT framework. Because of the wave of decolonisation, by the early-­to-mid 1960s, the number of developing countries had increased from 10 out of the 23 GATT founding members to a two-­third majority (Jupille et al., 2013, p.  142). Yet it

Development   135 was not only the greater number of developing country members, but also the rise of dependency theory that facilitated the institutionalisation of development-­ related rules in the GATT. This school of thought, established by Raúl Prebisch (1950) and other, mainly Latin American social scientists, argued that underdevelopment was caused by an exploitative division of labour between developing countries as exporters of raw materials and developed countries as producers of manufactured goods and technology. The ideas of these academic meaning makers were included into the political agenda of the New International Economic Order (NIEO) by UNCTAD, founded in 1964, and the Group of 77 developing countries (G77), which played an important role within the organisation. Prebisch became the first director of the UNCTAD and thus functioned as a political as well as academic meaning maker (Margulis, 2017, pp.  3–4). The Haberler Report (GATT, 1958) also helped to facilitate serious discussions about development. The ideas of dependency theory were crucial in tying the legitimacy of the GATT to its argument for a development-­friendly trade system, including a special set of rules for developing country members that allows for different – in particular preferential – treatment. As Erin Hannah and James Scott (2017, p. 121) argue, ‘underlying Prebisch’s analysis of the trade system and the problems developing countries faced therein was the idea that non-­equals should not be treated equally’. The basic idea was that if developing countries have to liberalise trade in the same way as developed countries, not only will they be unable to decrease the structurally unequal market positions they hold, but inequalities are likely to increase further. To overcome the unfavourable structures of the world market, developing countries demanded special treatment in terms of both exemptions from liberalisation commitments and preferential market access. This was assumed to require changes to the existing international rules as well as the trade policies of the developed countries, which were expected to adjust to the increasing competition from developing countries (see e.g. GATT, 1979, p. 57; Lamp, 2017, pp. 485–486). The development discourse of the trade regime was clearly ‘directed against the division of labour and the trade patterns instituted under colonial rule’ (Lamp, 2017, p. 483) at the beginning. This particular framing of the link between trade and economic development facilitated the institutionalisation of a new set of rules that apply specifically to developing countries. As Robert Hudec claims, at the time there was an ‘almost axiomatic assumption that trade-­policy rules which call for preferential treatment will make a positive contribution to curing the economic inequality of developing countries’ (Hudec, 2011, pp.  101). In 1964 a new ‘Part IV’ on ‘Trade and Development’ was added to the GATT, which established the principle of non-­ reciprocity as well as the central concept of Special and Differential Treatment (S&D) for developing countries. The ‘Enabling Clause’, adopted in 1979, legalised trade preferences for developing countries under the UNCTAD’s General System of Preferences (GSP). Both Part IV of the GATT and the Enabling Clause institutionalised the differential rights and obligations of ‘less developed’ or ‘developing countries’ and ‘developed contracting parties’.

136   Clara Weinhardt and Angela Geck While changes in discourse facilitated the institutionalisation of development­oriented trade rules, these rules were less successful in addressing structural inequality than developing countries had hoped for. They helped them to protect their own markets, but did not get them far in securing better access to developed countries’ markets (Rodrik, 2001). While preferential market access was only granted by developed countries on a voluntary basis, developed countries negotiated reciprocal tariff reductions amongst themselves (Hudec, 2011, pp. 68, 78). The resulting tariff cuts were extended to all GATT members under the principle of most-­favoured nation (MFN) treatment, but sectors in which developing countries were competitive – in particular, agriculture and textiles – remained highly protected. Despite these shortcomings, the 1960s and (early) 1970s must be seen as the ‘high point of the development challenge within the GATT’ (Lang, 2011, p. 47) and the international trade regime to date. In the 1980s, the debt crisis, the failure of import-­substitution industrialisation in Latin America and the rise of the South-­East Asian tiger economies, which pursued a state-­led but export-­oriented development policy, led to a radical re-­orientation of academic as well as political approaches to economic development (Booth, 1985; Menzel, 1992). With the advent of neoliberal economic thought, the mantra of liberalisation replaced the idea of redressing structural inequalities. While neoliberalism was partly a response to changing material realities, there was no clear evidence that previous ideas about economic development had failed. The change in discourse should be attributed to the influence of individual meaning makers like Deepak Lal (2000) and institutional meaning makers like the International Monetary Fund (IMF ) and the World Bank (Alessandrini, 2010, pp.  71–73; Weaver, 2010; Margulis, 2017, pp.  7–8). Their main goal was to reform countries’ economic policy on fiscal austerity, privatisation, deregulation and trade liberalisation. World market structures were no longer problematised. Rather, integration into the world market came to be seen an important precondition for development. The rise of neoliberal thought has transformed the language with which negotiators in the world trade regimes speak about trade and development. This has led to a redefinition of the concept of S&D. The purpose of S&D is no longer seen as redressing structural inequalities of the world trade order, but as aiding developing countries to reform their own economic systems in order to become more competitive on the world market. Following neoliberal logic, reform efforts are expected to amplify certain patterns of market-­orientation. We can distinguish three ways in which these changes in economic ideas have impacted the meaning of development in the world trade regime. In line with these changes in the discourse on development it has become more difficult for developing countries to uphold claims that they need a special set of rules – as represented by the concept of S&D – that grant substantive exemptions from trade liberalisation and better market access compared to developed countries. First, the concept of development in trade has become firmly linked to the concept of liberalisation. While dependency thinking had implied that trade-­offs between liberalisation and development were sometimes necessary, neoliberalism

Development   137 reconciled the two goals. Developed countries established the linkage during the Uruguay Round. For instance, at the GATT session of 1986 a German delegate stated that ‘[e]conomic development and the liberalization of world trade go hand-­in-hand; in other words, they move forward together, or fail together’ (GATT, 1986, p. 1). Because of this association between development and liberalisation, it became more difficult for developing countries to uphold claims that they needed to be exempted from liberalisation commitments under S&D. As a United States (US) representative explained in 1988: [e]xperience has shown – as pointed out by several delegations – that trade liberalization promotes, rather than hinders, economic growth and development. Trade liberalization is in fact sound economic policy for countries at all levels of development. Why then should we be encouraging exemptions from GATT obligations? (GATT, 1988, p. 3) With the advent of neoliberal ideas, developing countries were thus increasingly expected to open their markets – including in the realm of new non-­tariff and behind-­the-border issues, which intrude deeply on the domestic realm of regulation (Winslett, 2016). The Uruguay Round was the first negotiating round in which – under the single undertaking approach – all members had to subscribe to all rules and submit a schedule of tariff reduction concessions (Hoekman and Kostecki, 2009, p. 540). This shift was also reflected in new S&D measures that were introduced, namely longer transition periods for developing countries – which ultimately, however, had to comply with the same rules – and technical assistance (Michalopoulos, 2000, p. 14). Second, the neoliberal rejection of market intervention has also discredited Special and Differential Treatment of developing countries in the realm of market access. Developing countries must now frame their demands in terms of the neoliberal ideal of open markets, which implies reciprocity in liberalisation commitments. Third, because neoliberalism explains development with endogenous factors, it is now primarily the developing countries which are expected to change their policies, which changed the purpose of S&D. New aid programs addressing capacity and supply side constraints as part of S&D measures constitute a vehicle with which the WTO can interfere in the internal affairs of developing countries and promote liberalisation. In contrast to dependency theory, which inspired demands to change the international rules governing global trade and the policies of the developed world, neoliberalism assumes that poor countries need to change their own policies in order to develop. While neoliberal approaches to economic development increasingly became subject to criticism from the 1990s onwards (Chomsky, 1999; Stiglitz, 2002; Chorev and Babb, 2009), we argue that its ideas have proven to be highly resilient (Crouch, 2011; Ban and Blyth, 2013, p.  244; Freyberg-­Inan and Scholl, 2014) and continue to shape the discourse on trade and development in the WTO era. The meagre outcomes of the negotiations so far make it difficult to assess

138   Clara Weinhardt and Angela Geck how the discourse on development influences what counts as ‘development-­ friendly’ rules under S&D. But we are now seeing that many developing countries are either framing their demands in neoliberal terms or becoming increasingly sidelined on global trade platforms. This suggests that the narrower definition of S&D remains central. The Doha Development Round, which is based on the very idea that a trade liberalisation round can promote development, has reinforced an understanding of development that is based on neoliberal ideas. The words ‘liberalisation’ and ‘development’ are used in the same sentence once in every fifth statement during the Doha Round compared to once in every 13th statement during the Uruguay Round and once in every 34th statement during the Tokyo Round.6 This linkage of concepts has been largely uncontested, even among developing countries. Nigeria for instance, whose trade policy is ‘mostly unfree’ according to the Heritage Foundation Economic Freedom Index (Miller et al., 2018), in principle ‘acknowledges that trade liberalization can and does contribute to economic growth and development’ (WTO, 2009, p. 2). While challenging the dominance of the established powers, the emerging countries did not really depart from the Washington Consensus (Ban and Blyth, 2013), but adopted the neoliberal rhetoric of the established powers in the WTO context (Hopewell, 2016) and developed a ‘global developmental liberalism’ instead (Cammack, 2012). Developed countries increasingly expect developing countries to comply with the same standards as themselves, because liberalisation is considered the best policy for countries at all levels of development. A developed country official underlined this expectation when stating, [o]ne thing that I think is not going to work anymore in the future is to say, this is the set of rules for developed countries in some kind of modalities, and this is the set of rules for developing countries.7 Countries that continue to demand exemptions from liberalisation commitments for developing countries under S&D – now often in the form of calls for more policy space (Hannah and Scott, 2017) – are increasingly sidelined in WTO negotiations. India, which has championed the defensive developing country demands like the Special Safeguard Mechanism (SSM) in agriculture and the exemption of food stockholding programs from subsidy disciplines, has received much criticism for its nonconformist stance (Efstathopoulos and Kelly, 2014; Wilkinson et al., 2014). Similarly, neoliberal antipathy against market interventions continues to inhibit preferential market access arrangements for developing countries. In the Doha Round, exceptions from this rule are only made for Least Developed Countries (LDCs) which are directly covered by the Duty-­Free Quota-­Free (DFQF ) market access which members agreed to improve at the Bali Ministerial Conference in 2013. Other developing countries can still demand market access, but only in the form of general market liberalisation, not in the form of preferential access which would give them an edge over developed country competitors. Brazil, which is very competitive in agriculture, has taken

Development   139 this route, pushing for the liberalisation of agriculture as a leader of the G20 in the Doha Round (Hopewell, 2013). ‘Our platform is about “levelling the playing field”, through the full integration of agriculture into the multilateral rules-­based trading system’, Brazil’s Minister of Foreign Affairs Celso Amorim (2003) declared after the Cancún Ministerial. To legitimise their initiative for the abolition of cotton subsidies, even the Cotton Four, consisting of four LDCs, framed their demands in neoliberal terms (Eagleton-­Pierce, 2012). When President Blaise Compaore of Burkina Faso introduced the cotton initiative to the Trade Negotiations Committee, he emphasised, ‘our countries are not asking for charity, neither are we requesting preferential treatment or additional aid. We solely demand that, in conformity with WTO basic principles, the free market rule be applied’ (WTO, 2003). Framing offensive demands in terms of the neoliberal liberalisation credo reifies a narrower re-­definition of S&D and limits the kinds of development-­friendly rules that developing countries can call for. It makes sense only for those countries which are already competitive in at least certain sectors and it implies a general commitment to market opening which makes it more difficult to protect one’s own markets. For instance, developed countries have been quick to ask developing countries pushing for liberalisation in agriculture to reciprocate in industrial goods – where most of them are much less competitive. Finally, the endogenous explanation of ‘underdevelopment’ contained within neoliberal thinking continues to define who is seen as responsible for addressing the inequality between developed and developing countries. By fusing the discourse on development in the world trade regime with neoliberal ideas, a much greater emphasis was placed on the individual – rather than structural – obstacles to economic growth. While in the Tokyo Round structural adjustment was expected from the developed countries, in the Uruguay and Doha Round most statements about structural adjustment concerned developing countries – usually in the context of the IMF Structural Adjustment Programmes for debtor countries. Developing countries are seen as responsible for integrating themselves into the global trading system, while developed countries are merely expected to provide financial or technical assistance. The responsibility of developed countries to address structural imbalances in the world economic system – as earlier interpretations of S&D emphasised – recedes into the background. In his statement at the WTO Ministerial Conference, Horst Köhler, then Managing Director of the IMF, stated: failure [on the part of poor countries] to integrate into the global trading system has been all too common.… In order to succeed, they need to strengthen their own policies and institutional capacity, alongside greater assistance from the international community and renewed growth in the global economy. (WTO, 2001b, p. 2) This discourse has also been taken up by developing countries themselves. A  representative of Paraguay for instance argued along similar lines in 2005:

140   Clara Weinhardt and Angela Geck ‘[i]t goes without saying that we recognize the primary responsibility of each individual State for its own development’ (WTO, 2005, p. 2). The responsibility of the developed countries and the international community lies in providing aid and advice – rather than in providing improved market access and addressing existing imbalances in the global economic system. This idea is reflected in the greater prominence of S&D that relates to technical or financial assistance such as the ‘Technical Cooperation for Capacity­Building, Growth and Integration’ (WTO, 2001a, p.  1) and ‘Aid for Trade’ (WTO, 2017a) initiatives. In the name of development, these aid programs interfere with economic policy decisions in developing countries and ultimately promote liberalisation in developing countries – while market distortions in developed countries remain unaddressed. Similarly, the S&D measures included in the Trade Facilitation Agreement, concluded in 2013 as part of the Doha Development Round negotiations, amount merely to longer implementation periods and capacity-­building support for developing countries. Other decisions made during the ongoing negotiation round show that special measures in favour of improving market access for LDCs are framed primarily in terms of unbinding best-­endeavour clauses (Narlikar and Tussie, 2016, p. 218).

From political to economic definitions of developing country status: toxic discussions about differentiation and emerging powers While for much of the GATT era the trade and development debate focused on the question of what development friendly rules are, in the Doha Round the question of who counts as a developing country to start with has come to dominate discussions. In particular, emerging countries such as Brazil, India and China as well as established powers such as the US and the European Union have begun to act as meaning makers when it comes to defining the boundaries of developing country status in the world trade regime. We argue that this shift in discourse towards differentiation among developing countries does not only reflect greater heterogeneity in terms of economic development among them, but also a closer association of the developing country status with specific economic criteria – and thus a change in the ‘mind map’ used to discuss development in the world trade regime. The GATT’s legal framework did not clarify who counts as a developing country. Even though GATT Part IV and the Enabling Clause provided legal grounds for preferential treatment of developing countries, the question of who could claim to be a ‘developing’ country remained unspecified (Heron, 2013, p. 22). Instead, countries could simply designate themselves as developing countries (Rolland, 2012, p. 80). UNCTAD was instrumental in institutionalising this practice of self-­declaration as a means of strengthening solidarity across developing countries (Heron, 2013, p. 22). The definition of a developing country was understood primarily in relation to a common ‘history rooted in the inequalities of a colonial or imperialist past’ (Alden et al., 2010, p. 3; see also Dirlik, 2004).

Development   141 The group of 77 developing countries for instance explicitly sought to redress ‘injustice and neglect of centuries’ (UNCTAD, 1964). More generally, developing country status was influenced by the ideologically informed notions of three worlds that emerged during the Cold War: the ‘First World’ of free industrialised countries, the ‘Second World’ of communist industrialised countries and the ‘Third World’ of underdeveloped, non-­industrialised countries (Escobar, 1995, p. 31).8 This highly political understanding of developing country status was important because it implied that there was no need to resort to clear-­cut economic criteria for defining who could claim benefits under the Enabling Clause. Only the legally defined sub-­category of ‘least-­developed’ among the developing countries (that was imported from the UN system into the GATT) was less rooted in the notion of solidarity among developing countries. The category reflected a combination of economic and socio-­economic criteria, including a per capita Gross Domestic Product (GDP) of US$100 or less, a share of manufacturing in total GDP of 10 per cent or less, and an adult literacy rate of 20 per cent or less (UN ECOSOC, 1971, p. 16; Hawthorne, 2013, pp. 18–19). Developed countries first began to contest the established practice of ‘self-­ declaration’ in the GATT in the early 1970s and the 1980s. The United States attempted to introduce the concept of graduation in order to exclude newly industrialising countries from developing country status, initially with limited success. By the early 1980s, however, the greater economic differentiation of the developing country bloc became more apparent, in particular as Brazil and South Korea and other East-­Asian countries continued to grow rapidly (Alessandrini, 2010, pp. 119–121; Preeg, 2012, p. 125). As a result, developed countries began to demand greater differentiation between LDCs and other developing countries. During the GATT’s Uruguay round, developed countries succeeded in restricting a range of development-­oriented concessions to the limited sub-­group of LDCs. But the right of countries to designate themselves as developing countries within the world trading system remained untouched. The practice of self-­declaration continued into the 1990s when the WTO was founded after the end of the Uruguay round negotiations. The WTO states on its website that [t]here are no WTO definitions of ‘developed’ and ‘developing’ countries. Members announce for themselves whether they are ‘developed’ or ‘developing’ countries. However, other members can challenge the decision of a member to make use of provisions available to developing countries. (WTO, 2017b) During the Doha Development Round, however, developed countries began to contest the practice of self-­designation more fiercely than ever before. In response to the rapid economic growth in some parts of the developing world, developed countries – most prominently among them the US – challenged the  classification of countries such as Brazil, India and China as developing

142   Clara Weinhardt and Angela Geck countries. Given the greater economic weight of these countries, the question of classification became highly entangled with the political dynamics of the much-­ proclaimed power shift from the West towards so-­called ‘rising powers’. The reluctance of the US and the European Union to accept their claims to developing country status is a reflection of the unwillingness to grant special treatment to countries that were more and more seen as competitors. They feared that S&D would give Brazil, India and China a significant commercial advantage over developed countries (see Hopewell, 2016, p. 141). To support their calls that Brazil, India and China should graduate from developing country status, and therefore their right to S&D, developed countries acted as meaning makers who tried to refocus the definition of the developing country status on economic criteria. The US Ambassador to the WTO, Michael Punke, asked whether ‘advanced developing economies like India, China, and Brazil, [are] ready to accept the responsibility and leadership that goes along with their new position in the global economy’ (ICTSD, 2010). The emphasis on their current ‘position in the global economy’ contrasts earlier and more inclusive understandings of the developing country category rooted primarily in a shared history. By defining their status as ‘developing economies’ rather than ‘developing countries’ he shifts the framing of the definition of the developing country group from political towards economic criteria. Brazil, India and China are now commonly referred to as ‘emerging economies’ in the WTO. The concerned countries strongly object to this new practice of categorisation, including the term ‘emerging economies’ or the notion of ‘emerging countries’ as a new category of WTO members. A trade official from one of these countries for instance complained that ‘there is no word called emerging countries or emerging developing countries in the WTO terminology, but it is a word which is largely used by the US and its think tanks’.9 Their attempts to counter new discourses on classification mirror both the attempt to correct historical imbalances and injustices (Narlikar and Tussie, 2016, p. 213) as well as the strategic incentive not to graduate from the developing country status to maintain access to S&D (Lamp, 2017, p. 492). While there has been a ‘tacit acknowledgement of diversity among developing countries’ (Hannah and Scott, 2017, p. 127) the question of how to classify emerging countries remains unresolved. As the former WTO Director-­General Pascal Lamy lamented: [w]e know the rule of the game for rich countries, we know the rule of the game for poor countries. But WTO members have not made up their mind whether China is a rich country with many poor, or a poor country with many rich.  (Pascal Lamy, quoted in Anyangwe, 2013) Crucially, which economic criteria are relevant to the delimitation of the boundaries of developing country status remains contested, with some arguing in favour of GDP, and others in favour of per capita GDP as an indicator. US

Development   143 officials, for instance, frequently refer to China as ‘the world’s second largest economy’ (US press release, 2016) to delegitimise China’s claims to be acknowledged as a developing country. China, on the contrary, claims that the country continues to hold a comparatively low per capita gross domestic product, even if its overall economic performance is impressive. In its 2011 White Paper on ‘China’s Peaceful Development’, the government stated that: China’s per capita GDP in 2010 was about USD4,400, ranking around the 100th place in the world. Unbalanced development still exists between the urban and rural areas and among different regions; the structural problems in economic and social development remain acute. (PRC, 2011) Therefore, the definition of an emerging economy as opposed to a developing country remains contested. The term emerging economies, however, has gained traction in ‘WTO speak’ and – whether rightly or wrongly– makes it easier to exclude economically advanced developing countries from the special rights originally associated with the developing country status. The way in which the definition of the developing country status changed over time has facilitated the ‘capture’ of the development discourse through questions of differentiation. There is a tendency to differentiate among an increasing number of sub-­within the developing country category. As a result, S&D measures target particular sub-­groups of developing countries, most prominently the group of Least Developed Countries. While it is too early to tell how the greater focus on differentiation – facilitated by an emphasis of specific economic criteria for defining the group of developing countries – will affect the position of developing countries in the WTO in the end, two unintended side-­effects have already become apparent. First, developing countries that are neither ‘emerging’ nor part of the most relevant sub-­group, the LDC group, find it increasingly difficult to benefit from their status as a way to access S&D measures in WTO negotiations. Developed countries have been hesitant to grant Special and Differential Treatment to developing countries, given that emerging countries continue to self-­designate themselves as members of that group. As a result, many developed country members focus their attention more and more on LDCs rather than on ‘developing countries’ as legitimate right-­holders of S&D. The growing importance of this more limited sub-­category manifests itself in the decreasing number of references to developing countries compared to LDCs (see Table 9.1). During the Tokyo round, references made to the entire group of developing countries were around 35 times more frequent than those to the narrower sub-­group of LDCs. By the time of the Doha round, WTO members referred to both terms with almost equal frequency. This shift in language has not been without consequences. The only decisions made so far under the WTO, the Bali package (2013) and the Nairobi package (2015), for instance included a number of new S&D provisions that only apply

144   Clara Weinhardt and Angela Geck Table 9.1 Developing country categories in statements at GATT sessions of contracting parties and WTO ministerial conferences

LDC term1 Developing country (DC) term2 Ratio DC/LDC term per statement

Tokyo round

Uruguay round

Doha round

27 963 35.7

105 485 4.6

1,432 1,807 1.3

Notes 1 Search terms were: LDC/least developed/least-developed. 2 Search terms were: developing country/developing econom/developing member/developing world/ developing and emerging/developing and least developed/developing and least-developed/­ developing and LDC.

to LDCs: preferential rules of origin (WTO, 2013a, 2015a), preferential treatment in services (WTO, 2013b, 2015b) and a best-­endeavour decision on DFQF (WTO, 2013c). A developing country official from a non-­LDC country lamented this trend, arguing that: we have a problem with countries that are developing but are not LDCs.… Most of the time we end up losing a lot. Since 2005, the LDCs have been harvesting the duty-­free-quota-­free market access from Hong-­Kong.… However, the countries that are not LDCs are the losers.11 As a result, many developing countries, especially middle-­income countries, are very sensitive and defensive to any discussions about differentiation. It is feared that differentiation could ‘be used to undermine the delivery of S&D in its totality’.12 Second, increasing contestation of the emerging countries’ self-­declaration as developing countries was detrimental to other developing countries that claim special rights under S&D. The unresolved stand-­off over classifications has ultimately diverted attention away from the development agenda of the round, as the conflict between emerging and established powers has become more entrenched.13 As Nicholas Lamp (2017, p.  496) has argued, ‘[t]he developed countries are ever less willing to accept that the emerging economies take refuge in a discourse of development that emerged at a very different historical juncture’. Yet, emerging countries are equally unwilling to back down, which as a developing country representative summarised, reinforces the deadlock situation: so it is now a battle amongst the developed countries and the so-­called emerging economies.… So the round has now become hostage to that struggle between the developed and the emerging economies.14 This, in turn, meant that the fate of the WTO has been linked to a lesser extent to the concept of development in recent years – despite the continuing prominence of the term. When the Doha Development Round was launched in 2001, there

Development   145 was clear agreement among developed and developing countries that development needs to be central for the WTO to succeed. The Doha Ministerial Declaration (WTO, 2001c) stated that ‘[t]he majority of WTO members are developing countries. We seek to place their needs and interests at the heart of the Work Programme adopted in this Declaration’. But as a result of the unresolved deadlock situation, politicians have increasingly turned to negotiations of free trade agreements outside of the WTO (Muzaka and Bishop, 2015, pp. 390–292). Many officials and observers began to question the efficiency of the WTO (Narlikar, 2010, p. 724). These partly external developments gave rise to narratives that portray Doha as a ‘life and death struggle’ for the world trading system rather than primarily a development-­oriented negotiation round. They suggest that it is more important to focus on short-­term measures that safeguard the multilateral system (Wilkinson, 2012, p.  397) than to resolve the core issues of the Doha mandate. The recent calls of developed countries – the US in particular – to close the Doha Development Round, even if no agreement is reached, exemplify the fact that the ongoing deadlock situation has reduced the discursive space to demand more development-­friendly rules based on S&D. Given that ‘international trade policy is developing in a more aggressive way’,15 many developing country representatives seem to have accepted the fact that it has become almost inevitable that they will have to give up some of their aspirations. In particular, the promise to conclude the Doha Development Round only when agreement on all issues – including on S&D for all developing countries – can be reached, seems difficult to push through. As a developing country representative said: it is ‘not really good for developing countries, but the most realistic way; otherwise the credibility of the WTO seems to be threatened’.16 Another representative added that ‘the pragmatic way is to avoid the toxic discussions of definitions’.17 Paying attention to language has thus brought the important role of contestation over where to draw the boundaries between – and within – the groups of developing and developed countries to the forefront. These boundaries, created through language, affect not only who can claim to legitimately have access to S&D as a developing country, but the role of contestation also helps us to understand how the negotiation round has been taken hostage by a stand-­off between emerging and developed countries over classifications.

Conclusion Notwithstanding the fact that the WTO is holding a Development Round, developing countries continue to lament the growing marginalisation of their interests. Changes in discourse alone cannot account for the lack of success that developing countries have in asserting their interests in the WTO. Even during the golden era of dependency-­theory-inspired special treatment in the GATT in the 1960s and 1970s, developing countries were unable to secure access to sensitive sectors of developed country markets. However, we have demonstrated how paying attention to changes in the language of development in the world trading

146   Clara Weinhardt and Angela Geck system since the 1980s helps us to understand why many developing countries claim that their concerns remain unheard – despite the increasing prominence of the term in the Doha Development Round. The kind of S&D they ask for may have been discredited or has become marginalised in debates about who can claim developing country status in the first place. The manner in which the discourse on development evolved in the world trading system was closely linked to the prominence of different theories of economic development. While the failure of import-­substitution development in Latin America and the economic growth in South East Asian countries – that was perceived to be the result of trade liberalisation policies – discredited dependency theory, there was and is nothing inevitable in the waxing and waning of different economic theories. Meaning makers, such as the economist Raúl Prebisch or UNCTAD regarding dependency theory or the economist Lal and the World Bank or the IMF regarding neoliberalism, were crucial in pushing for discursive shifts which ultimately resulted in narrower (re)interpretations of S&D. The continued prominence of neoliberalism in the WTO era means that the language of neoliberalism present in the minds of negotiators from developed as well as many developing countries continues to bind development to liberalisation. It defines the kinds of demands that developing countries can make in the trade regime, as it makes market intervention seem like a taboo word. Similarly, with the economic rise of countries such as Brazil, India and China, questions of differentiation among the developing country bloc have gained new prominence. But the categorisation of countries into the camps of developed and developing countries is by no means unambiguous. The question of where to draw the boundary between developed and developing countries is political as well as analytical. It depends on whether the central criterion is political alliance or economic performance and on whether economic performance is measured in terms of trade capacity or the number of people living in poverty. To some extent, these struggles over where to draw the boundary of the category of developing country have undermined the ability of emerging countries to serve as advocates for a development agenda in the world trade regime. This finding stands in contrast with the assumption that it is primarily economic power that determines whether or not the concerns of developing countries are heard (see Baldwin, 2016). It uncovered that contestation over who counted as ‘developing country’ in the first place mitigated the bargaining power of developing countries as a bloc, and led to unintended outcomes. The unresolved stand-­off over how to classify emerging countries has not only had profound consequences for other developing countries that seek access to S&D, but has also weakened the political will of developed countries to provide development-­ friendly rules in the first place. The rise of economic populism, including President Trump’s recent attempts to discredit the WTO’s Dispute Settlement procedure, will strengthen discourses that call for saving the WTO in its ‘life and death struggle’ – even at the cost of abandoning the Doha Development Round.

Development   147

Notes   1 Enemalah delivered the speech on behalf of the Nigerian President Muhammadu Buhari.   2 We would like to thank Klaus Dingwerth, Stefan Rother and Stefan Wallaschek for comments on earlier versions of the chapter.   3 The sample includes 26 statements from the Tokyo Round, 207 statements from the Uruguay Round and 618 statements from the Doha Round. For the Uruguay and Doha Round written statements exist (usually one per actor and negotiating session). For the Uruguay Round the sample includes all statements made at the annual sessions of the GATT Contracting Parties between 1986 and 1994 (42nd to 50th session). For the Doha Round, it contains all statements made at the WTO Ministerial Conferences 2001, 2005, 2009 and 2013 (the 4th, 6th, 7th and 9th Ministerial Conference). For the Tokyo Round only summary records of the negotiating sessions are available. In order to arrive at a comparable measure of statements, we counted the number of actors (Contracting Parties, observers and GATT functionaries) who made interventions during the meetings of a particular annual session. All interventions made by the same actor during one annual session were counted as one statement. The sample for the Tokyo Round includes the summary records of all annual sessions of the GATT Contracting Parties between 1973 and 1979 (29th to 35th session).   4 The discourse on development creates a system of power that regulates its practice and fosters particular forms of subjectivity (Escobar, 1995, p.  9), constructing the developing world as different, inferior and poor (Escobar, 1995, p. 23, pp. 53–54; see also Doty, 1996, p. 16).   5 In the context of trade, development is commonly equated with economic growth. Alternative discourses on development emerged primarily outside of the world trading system. They go beyond an exclusively economic understanding of development and instead focus for instance on human development or the concept of ‘buen vivir’ – good living (Thérien, 2014).   6 0.22 times per statement in the Doha Round, 0.08 times per statement in the Uruguay Round and 0.03 times per statement in the Tokyo Round.   7 Interview with developed country official, Geneva, 16 September 2016.   8 Moreover, developing countries defined themselves by the occurrence of poverty as opposed to the ‘areas of affluence’ in the developed world (UNCTAD, 1964).   9 Interview with developing country official, Geneva, 15 September 2010. 10 These groups range from geographically defined groups such as the African group or the group of African, Caribbean and Pacific countries, to issue-­based coalitions such as the G20 and G33 bargaining coalitions that focus on agriculture to coalitions that rely on clear economic indicators such as the LDC group or the group of small and vulnerable economies. 11 Interview with developing country official, Geneva, 16 September 2016. 12 Interview with developing country official, Geneva, 29 September 2016. 13 Interview with developed country official, Geneva, 15 September 2016. For other reasons behind the Doha round deadlock, see Baldwin (2016, pp. 106–111). 14 Interview with developing country official, Geneva, 29 September 2016. 15 Interview with former developing country official, phone-­to-capital, 27 September 2016. 16 Interview with developing country official, Geneva, 23 September 2016. 17 Interview with official from International Organisation, Geneva, 30 September 2016.

148   Clara Weinhardt and Angela Geck

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Development   151 WTO, 2001b. Statement at Ministerial Conference: fourth session, WT/MIN(01)/ST/24. Statement by Mr Jesús Seade, Senior Advisor, IMF on behalf of IMF Managing Director, Mr. Horst Köhler, 9–13 November. Doha. WTO, 2001c. Ministerial Declaration, WT/MIN(01)/DEC/1, adopted on 14 November 2001. Geneva: WTO. WTO, 2003. News Item: Address by President Blaise Compaore of Burkina Faso. Geneva: WTO, Trade Negotiations Committee. Available from: www.wto.org/english/ news_e/news03_e/tnc_10june03_e.htm [accessed 22 January 2018]. WTO, 2005. Statement at Ministerial Conference: sixth session, WT/MIN(05)/ST/48. Statement by HE Mrs Leila Rachid, Minister for Foreign Relations, Paraguay. 13–18 December. Hong Kong: WTO. WTO, 2009. Statement at Ministerial Conference: seventh session, WT/MIN(09)/ST/18. Statement by Chief Achike Udenwa, Honourable Minister of Commerce and Industry, Nigeria. 30. November–2 December. Geneva: WTO. WTO, 2013a. Preferential Rules of Origin for Least-­developed Countries, Ministerial Decision, WT/MIN(13)/42, given on 7 December 2013. Geneva: WTO. WTO, 2013b. Operationalization of the Waiver Concerning Preferential Treatment to  Services and Service Suppliers of Least-­developed Countries, Decision, WT/ MIN(13)/43, given on 7 December 2013. Geneva: WTO. WTO, 2013c. Duty Free and Quota Free (DFQF ) Market Access for Least-­developed Countries, Ministerial Decision, WT/MIN(13)/44, given on 7 December 2013. Geneva: WTO. WTO, 2015a. Preferential Rules of Origin for Least-­developed Countries, ministerial Decision, WT/MIN(15)/47, given on 19 December 2015. Geneva: WTO. WTO, 2015b. Implementation of Preferential Treatment in Favour of Services and Service Suppliers of Least Developed Countries and Increasing LDC Participation in Services Trade, ministerial Decision, WT/MIN(15)/48, given on 19 December 2015. Geneva: WTO. WTO Website, 2017a. Aid for Trade. Available from: www.wto.org/english/tratop_e/ devel_e/a4t_e/aid4trade_e.htm [accessed 8 January 2018]. WTO Website, 2017b. Development: Definition. Available from: www.wto.org/english/ tratop_e/devel_e/d1who_e.htm. [accessed 8 January 2018].

10 Environment Emily Lydgate

Introduction In the almost 90 years since the first modern multilateral trade treaty was ratified,1 over 400 Regional Trade Agreements (‘RTAs’) have been concluded,2 with the World Trade Organization (‘WTO’) providing legal principles and an institutional foundation for the world trading system. Meanwhile, human-­made environmental problems, and domestic and international laws responding to these problems, have also multiplied. These laws include restrictions on imports of products identified as environmentally harmful, as well as the introduction of national environmental standards and regulatory requirements that complicate the free movement of goods and services. In various capacities and circumstances, the WTO has evaluated the compatibility of environmental trade restrictions with key WTO principles. A recurring question has been whether regulation that restricts trade in imported goods on environmental grounds can be reconciled with the core WTO principle of non-­discrimination based upon origin. Further, countries have made treaty commitments under a wide range of multilateral environmental agreements (MEAs); in some cases these clash with WTO obligations. Finally, the trade liberalisation that the WTO and RTAs have facilitated has contributed to macroscopic trends of economic globalisation. These include increased international transit of goods, increased resource exploitation and CO2 emissions resulting from economies of scale, and the ‘export’ of environmental regulation and standards (or lack thereof ) to foreign firms seeking market access. These many intersections have led to vigorous debate about what is often described as the trade and environment relationship. In this chapter I focus on how environmental protection has been understood and addressed within the WTO and its predecessor, the General Agreement on Tariffs and Trade (GATT). I also take account of the contributions of external meaning makers, notably civil society, academics and corporate lobbies, who helped shape these discourses. At the core of the WTO’s understanding of the environment is a consensus enshrined in the texts of WTO treaties: that trade and environment are ‘mutually supportive’. Treaties proscribe legal obligations, often characterised as ‘soft’ or ‘hard’ depending on how precise and binding they are (Abbott and Snidal, 2000).

Environment   153 These obligations are agreed by consensus among WTO Members, who comprise virtually all the world’s governments; thus they bridge a vast array of national positions. When considering the extent to which the WTO should take account of, and respond to, the demands of environmental protection, there is a large degree of divergence, making hard obligations difficult to achieve. The concept of ‘mutual supportiveness’ entails no binding action or duty. The term can be described as positively ambiguous: positive because the presumption is one of harmony; ambiguous because this positivity can be interpreted as assertion or aspiration. Section 2 develops a mind map of varying discourses on ‘environment’ in the context of the concept of mutual supportiveness. Section 3 traces discursive change regarding the term through the history of the world trading system. Section 4 reflects on an emerging dichotomy that complicates existing discourses identified herein, separating those who advocate multilateral approaches to trade liberalisation and environmental protection from those who discredit multilateral approaches as well as their goals. Section 5 concludes.

Mind map The existence of ‘mutual supportiveness’ between trade and environmental policies comprises a normative understanding that economic development, through trade liberalisation, will lead to better environmental protection. This is made clear in the WTO’s current negotiating framework and its founding treaty; many major international environmental treaties contain similar or identical language affirming that an open multilateral trade system will benefit the environment. This understanding resolves perceived conflicts between ‘environment’ and ‘development’, examined further below, through an emphasis on ecological modernisation. Yet WTO negotiations and reports of the WTO and GATT Secretariats make clear that many Members have expressed competing conceptions of the trade and environment relationship. One is that trade liberalisation and environmental protection are mutually antagonistic: growing environmental regulation described as ‘green protectionism’ which undermines free trade and the broader goal with which it is often conflated, economic development. Developing countries often complain that developed countries impose complex environmental regulatory requirements as trade barriers (Sampson, 2005; see also Jackson, 1992, p.  1230). At times developed countries, notably the US, have also criticised environmental regulation that impedes important export markets, such as Genetically Modified crops (Eckersley, 2004, p. 44). This underscores that countries’ positions vis-­à-vis particular environmental regulations are shaped by their export interests and the corporate lobbies that represent them, the latter thus forming another environmental ‘meaning maker’. Another important discourse that has run through the WTO and the GATT before it is that of mutual exclusion: environmental protection is sometimes described as a ‘non-­trade’ issue, falling outside the WTO mandate. Even while

154   Emily Lydgate the WTO’s founding treaty sets out its objective of securing sustainable development, WTO Members have also circumscribed its mandate as consisting of ‘trade issues’. As the argument goes, the WTO does not have the capacity or expertise to respond adequately to environmental problems. In practice this prohibition serves to delimit the WTO’s environmental responsibilities. It led, for example, to the selection of the WTO’s Committee on Trade and Environment (CTE) negotiating items in which trade liberalisation will benefit the environment (such as trade in Environmental Goods and Services). Mutual supportiveness provides a pragmatic formulation to span these contentious discourses. It provides a basis for consensus by avoiding the establishment of any formal hierarchy, which would threaten the interests of many stakeholders. Indeed, the concept treads a somewhat contradictory line: it purports to address, but also to negate the possibility of, conflict. As multilateral treaty language, its non-­binding nature and the positive ambiguity surrounding its interpretation contribute to its success. Additionally, while the negotiations make clear that mutual supportiveness implies an obligation to seek good faith solutions in the event of conflict, the concept does not proscribe any precise legal obligation. In sidestepping this challenge, Members circumscribe the WTO’s environmental ambition. A final discourse, most evident in academic literature, presents the WTO’s approach to the environment in evolutionary terms as an arc of progress from the GATT to the WTO. There has been progress, but deep divisions between WTO Members mean that the hallmark of the WTO approach to the environment has been caution. WTO negotiators and the Appellate Body have maintained ambiguity regarding the ‘tough questions’ that arise when there are actual or potential clashes. The result is to preserve, passively, the primacy of WTO obligations.

Discursive change Origins of the multilateral trade system The WTO website states that the awareness of the relationship between trade and the environment of its predecessor, the GATT, dates back to 1970 (WTO website, 2018a). Trade scholars often echo this message, asserting that the environment was not on the agenda of GATT negotiators in the late 1940s as it was simply not a recognised international concern.3 Sympathetic academics, the WTO Secretariat and trade negotiators often portray the WTO’s support for, and understanding of, environmental protection in an evolutionary light. While some GATT rulings were problematic, later disputes, notably the so-­called ‘Shrimp– Turtle’ WTO dispute of 1998, marked the emergence of adequate ‘policy space’ (Andersen, 2015; Charnovitz, 2007; see also note 7) for environmental regulation. However, while there was an explosion of MEAs and domestic environmental regulation starting in the 1970s, which drove these issues higher up the GATT agenda, ‘trade’ and ‘environment’ treaties have been coordinated and interconnected. International efforts to manage wildlife trade and conservation arose

Environment   155 contiguously with early trade treaties. Negotiators recognised that trade restriction played an important role in enabling wildlife conservation treaties to achieve their goals. In 1900, European colonial powers signed the Convention for the Preservation of Wild Animals, Birds and Fish (London Convention); in the same year the US passed its first federal law protecting wildlife, the Lacey Act, which prohibited trade in animals hunted illegally.4 During the years leading up to the Second World War further multilateral treaties were concluded for conserving natural and living resources.5 In 1929, the Convention for the Abolition of Import and Export Prohibitions and Restrictions (Prohibitions Convention) was also concluded. Its original 29 signatories included the same trade powers behind the London Convention and the Lacey Act. Aware that promoting free movement of goods could undermine these efforts, they excluded from coverage ‘measures taken to prevent them [animals or plants] from degradation or extinction’.6 Soon after the end of the Second World War the United Nations launched negotiations for an International Trade Organization. The proposed Havana Charter founding the International Trade Organization (ITO) incorporated similar language on measures to protect animals and plants. The ITO also acknowledged that existing treaties on wildlife conservation should take precedence in the event of a conflict. It contained an exception for measures ‘taken in pursuance of any inter-­governmental agreement which relates solely to the conservation of fisheries resources, migratory birds or wild animals’ (United Nations, 1948). In this respect it was more deferential to environmental treaties than the current WTO, which contains no such exception. Indeed, incorporating such an exception into the WTO, which declares that MEAs should prevail in a conflict, is a proposal often made by environmental advocates (Eckersley, 2004, p. 44). The ITO formed part of the UN and its larger aims to achieve peace and prosperity, economic and social development (United Nations, 1948, n. 12, Chapter 1, Purpose and Objectives, Article 1). As well as giving employment equal billing to trade as a treaty objective (the Havana Charter on Trade and Employment), it also safeguarded labour standards, an issue which has continued to elude formal recognition by WTO Members. Doomed by its deep ambition to regulate the global economy, which included management of countries’ trade balances, it was never ratified, but remains an alternative vision for an international trade organisation with more broadly-­conceived aims and objectives. The General Agreement on Tariffs and Trade in 1947 became the de facto governing instrument for international trade. The GATT included a General Exception, Article XX. Its negotiators neglected to include a specific exception for ‘conservation of fisheries resources, migratory birds or wild animals’ discussed in the preparatory work for the Havana Treaty (see WTO, 1991, para. 3.30). It does, however, permit trade-­restrictive measures that fall into certain categories with antecedents in the Prohibitions Convention, Articles XX(b) and (g), which apply to measures protecting human, animal or plant life or health, and conserving exhaustible natural resources, respectively. The chapeau to Article XX applies an additional non-­discrimination test, requiring that the

156   Emily Lydgate measure should not constitute ‘arbitrary or unjustifiable discrimination’ or ‘disguised restriction on international trade’ in ‘countries where the same conditions prevail’. GATT 1947, including Article XX, was incorporated into the WTO Agreements in the form of GATT 1994, still often invoked by WTO Members in disputes. Thus GATT Article XX(b) and (g) remain important in disputes on environmental regulation; many such disputes in the GATT and later the WTO have turned on the interpretation of these phrases.7 The 1970s: pollution, regulation, development In the 1970s two parallel narratives about the trade and environment relationship developed. First, the GATT was positioned as a body with competence to address negative impacts of environmental regulation on trade, feeding its expertise and priorities into international environmental negotiations. Second, as a settlement of the North-­South divide, the UN Conference on the Human Environment (UNCHE) arrived at a positive construction of the relationship between environmental and development. This laid the groundwork for subsequent treaties to position trade – a driver of economic development – as a support for environmental protection. By the 1970s the GATT was a heterogeneous global organisation including newly independent former colonies (Milner, 2005). As the GATT proved its utility in facilitating tariff reduction, the final two rounds of GATT negotiations in the 1970s and 80s increasingly focused on reducing non-­tariff barriers to trade (WTO website, 2018d). The GATT obligates countries to treat the products from all WTO Members equally vis-­à-vis one another (the Most Favoured Nation Principle set out in Article I:1) and vis-­à-vis domestic products (the National Treatment Principle set out in Article III). As opposed to tariffs that are collected at the border, these non-­discrimination provisions focus primarily on internal domestic regulation. They apply not only to laws that specify different treatment of products based on their origin (de jure discrimination) but also to de facto discrimination from origin-­neutral laws. Determining whether a domestic regulation contravenes these provisions requires intensive judicial review. This emphasis on non-­discrimination was significant, as the 1970s also marked the beginning of the global environmental movement and an explosion of domestic environmental regulation worldwide. The 1972 UNCHE was the first to focus on environmental issues. In negotiations, developing countries threatened to boycott on the basis that they were being asked to take responsibility for problems they did not create. There was concern among countries long  upon sovereign use of natural resources (Mickelson, 2015). This resulted in  a broad yet shallow treaty that focused on linking the environment to the imperative of encouraging development and global equality. In the words of Indira Gandhi, who represented India: ‘Are not poverty and need the greatest polluters? […] The environment cannot be improved in conditions of poverty. Nor can poverty be eradicated without the use of science and technology’ (Gandhi, 1972, p. 35).

Environment   157 Gandhi’s statements illustrate the premise that provided a basis for international consensus on the need to protect the environment. It is summarised neatly by the motto of the UN Environment Programme, founded at the UNCHE: ‘environment for development’. This justification for environmental protection draws from ecological modernisation, a school of thought that focuses on the contributions of environmental protection to economic development, and the environmental Kuznet’s curve, which posits that increasing GDP leads to better domestic environmental outcomes (see Stern, 2004). The idea of ‘mutual supportiveness’ between trade and environment had not yet been adopted. By linking trade with economic development and prosperity, it extends the same premise that was so useful in achieving consensus in the UNCHE context. Yet when the GATT Secretariat was invited to contribute to UNCHE it raised concerns about regulation for environmental protection. It produced a report on ‘Industrial Pollution Control and International Trade’ (GATT, 1971), which examined ways in which the proliferation of environmental regulation might distort free trade. It analysed different forms of regulation or trade restriction that countries might impose in order to compensate domestic industries for the costs of increased anti-­pollution regulation, ranking them in terms of their trade-­distorting effects and likelihood to contravene GATT obligations (GATT, 1971, pp. 13–19). 1980s and 1990s: treaty harmony, civil society rage As these contrasting narratives of harmony and conflict between economic development and environmental protection were further developed, their potential for incongruence became clearer. During the late 1980s and early 1990s a number of major environmental treaties proclaimed the contribution of trade liberalisation to environmental protection; simultaneously, there was increasing protest against the GATT’s environmental record. In 1989, the World Commission on Environment and Development produced ‘Our Common Future’, also known as the Brundtland Report, which established the term ‘sustainable development’ as a locus for international law. The term itself frames a resolution of the UNCHE challenge: constructing the relationship between environmental protection and development in a positive and general enough manner to create international consensus. Trade was positioned as a force to support environmental protection. During the 1992 Earth Summit in Rio, environment ministers suggested that the only contribution GATT should make to sustainable development was to conclude the Uruguay Round successfully (United Nations, 1992b). The non-­binding Agenda 21 (an Agenda for the twenty-­first century) concludes that an open multilateral trading system is consistent with sustainable development; improved market access for developing countries’ exports will have a positive environmental impact (United Nations, 1992c). Agenda 21 includes the first treaty reference to mutual supportiveness: ‘[t]he international community should provide a supportive international climate for achieving environment and development goals by … making trade and

158   Emily Lydgate environment mutually supportive’.8 Indeed, both sustainable development and mutual supportiveness provide the same broad-­brush reconciliation of potential conflict (see also Lydgate, 2012). In fact, tensions between major export industries and environmental lobbies were growing. The first GATT dispute on environmental regulations took place in 1991: United States – Restrictions on Imports of Tuna, often referred to as Tuna–Dolphin. Mexico complained that the US Marine Mammal Protection Act, which banned tuna caught by ‘purse seine’ nets that also trapped and killed dolphins, was discriminatory. The US aimed to protect dolphins that were not in its own domestic territory, but rather that of Mexico. The GATT Panel decided a country taking trade action to attempt to enforce its own laws in another country could not take recourse to the Article XX exception detailed above.9 It also ruled that the US could not legally ban tuna because it objected to the way that it was produced. The GATT Secretariat published a study underscoring the Panel’s ruling. After concluding that trade benefits the environment, it warned that protectionist interests can exploit environmental regulation, stating that: [i]f the door were opened to use trade policies unilaterally to offset the competitiveness effects of different environmental standards, or to attempt to force other countries to adopt domestically-­favoured practices and policies, the trading system would start down a very slippery slope. (GATT, 1992, p. 6) It identified environmental policies as a ‘potentially serious source of new protectionism’ (GATT, 1992, p. 34). US environmentalists responded by launching protests against ‘GATTzilla’ trampling over national regulation. The strength of the public protest contributed to the decision of the US and Mexico that the ruling should not be implemented.10 But the ruling simply put into practice concerns of GATT Members about ‘unilateral’ trade-­restrictive regulation to address transboundary environmental problems. Regulation based upon processes and production methods, or PPMs in WTO parlance, are split into the categories of product-­related and non-­productrelated (NPR). The former, while physically invisible, have to do with quality or functionality. This dispute concerned the latter: invisible distinctions based on NPR PPMs, in this case a ban applied to fish caught following a particular fishing process. Basing trade distinctions on such distinctions intrudes deeply into the production process in order to impose foreign values; many GATT members rejected the legitimacy of basing trade restrictions on such distinctions.11 The earlier chapter in this volume, on Protectionism, provides a useful companion analysis here (Winslett, this volume). The ruling and report clarified that countries could not utilise trade restriction to achieve environmental objectives if it required exporting countries to modify their production practices. This undermined national environmental regulation, and threw into doubt the GATT-­legality of national trade restrictions responding

Environment   159 to multilateral obligations. A sub-­set of MEAs utilise trade restrictions, such as import or export bans, requirements for packaging or shipping, requirements receive consent from importing countries, or simply reporting requirements. These restrict trade in environmentally-­harmful goods,12 and encourage MEA participation and compliance.13 In describing the negotiations of the Montreal Protocol, Brack stated: trade provisions of the Protocol … were a vital component in (a) building the wide international coverage the treaty has achieved and (b) preventing industrial migration to non-­parties to escape the controls on ODS [ozone depleting substances]. (Brack, 1996, p. xvii) Parker (1999–2000, p.  3) summarised well the utility of trade restrictions in achieving stronger outcomes for MEAs with a rhetorical question: ‘Can a world of over 150 nation-­states effectively preserve what is left of its global commons by consensus only, without any use of trade leverage?’ As described above, early trade negotiators were mindful that trade restrictions were necessary to curb species extinction, and deferred to relevant MEAs. In contrast, the GATT ruling suggested that national efforts to implement trade-­related obligations of MEAs would be GATT-­illegal. Despite these dismal implications, the 1992 Rio Declaration on Environment and Development incorporated the central premises of the GATT report on Trade and Environment. Principle 12 states that ‘States should cooperate to promote a supportive and open international economic system that would lead to economic growth and sustainable development in all countries, to better address the problems of environmental degradation.’ It then draws from language of the chapeau of GATT Article XX, concluding that environmental trade policy measures should not ‘constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade’. It finally states that countries should avoid attempting to regulate environmental challenges in other countries through trade measures on a unilateral basis, urging international cooperation (United Nations, 1992a). In 1992 European countries convened the Group on Environmental Measures and International Trade (EMIT group). The group had not been convened since its founding in 1971, but GATT Members faced unprecedented countervailing environmental pressures. On the one hand, many Members, in particular developing countries, were concerned about the proliferation of environmental regulation. On the other, the GATT’s poor environmental record formed a significant focus of protest. Though clearly these stakeholders had opposing goals, both prompted greater environmental responsiveness from GATT Members. The remarks of the Chairperson summarising Members’ positions after the first meeting encapsulate the core discourses prevalent among GATT Members and illustrate how they attempt to reconcile countervailing objectives. The Chairperson affirmed that the GATT’s competence was limited to trade policies and

160   Emily Lydgate aspects of environmental policies that would affect trade. He underlined the ecological modernisation view that the multilateral trade system could help address environmental degradation and over-­exploitation in developing countries. Finally, he concluded that the trade system and sustainable development do not need to contradict; but trade rules should not be undermined by environmental measures (WTO, 1992). These statements reveal the utility to negotiators of positive ambiguity in steering a route through the opposing goals of relevant meaning makers, a theme further examined in the sections below. Founding of the WTO: progress? These same pressures that motivated the EMIT group shaped the decision to place more emphasis on the environment in the WTO, which was founded two years later (in 1994), replacing the GATT as the multilateral institution governing trade. As well as incorporating the original GATT, it contained additional Agreements on areas such as services, subsidies, technical regulation, sanitary and health regulation, and intellectual property rights. Elements of some of these Agreements pertained to the environment, and arguably the most significant developments were the enshrining of sustainable development as a WTO objective in the Preamble to the founding Marrakesh Agreement, and the establishment of the Committee on Trade and Environment. The latter formalised and expanded the work of the EMIT group as a standing Committee of the WTO. ‘Making international trade and environmental policies mutually supportive’ (WTO, 1994a) is its aim: this is the first mention in WTO treaty texts of the phrase, echoing its use in Agenda 21. In a 1996 report, the CTE expanded on this, stating that the aims of the WTO and that of environmental protection ‘are both important and they should be mutually supportive in order to promote  sustainable development’. It also reiterated that the WTO’s competence was limited to trade-­related aspects of environmental protection (WTO, 1996, paras. 167–168). The CTE responded to concerns about trade impacts on the environment fomented by Tuna–Dolphin. Yet it also provided for greater scrutiny of domestic trade-­restrictive environmental regulation. As stated by Eckersley, ‘These twin, and somewhat contradictory, objectives had already surfaced in the EMIT and they reflect persistent differences among the members – particularly between developed and developing countries’ (Eckersley, 2004, p. 30, footnote omitted). The CTE embraced, but also circumscribed, the WTO’s environmental responsibilities. The Decision on Trade and Environment, founding the CTE, states the need to coordinate trade and environment policies, but: … without exceeding the competence of the multilateral trading system, which is limited to trade policies and those trade-­related aspects of environmental policies which may result in significant trade effects for its members … (WTO, 1994b)

Environment   161 Thus, despite the WTO’s expansion of thematic coverage, it did not re-­capture the breadth and ambition of the abandoned ITO. Indeed, as noted by Lang, not only trade negotiators but also academic trade lawyers have reinforced this division: in both contexts, the environment is often described as a ‘non-­trade’ issue (Lang, 2007, p.  537). In becoming reflexive, this rhetorical separation circumscribes the way that we understand the responsibility of the international trade system to examine its environmental impacts. Lang further stated that: [i]t is not self-­evident, of course, that the major international institution presiding over the global trade system has no business addressing the social and environmental impacts of that system, and that such impacts are not ‘trade issues’. (Lang, 2007, p. 537) The narrowness of the GATT and then WTO, in focusing only on ‘trade issues’, was attributed by some commentators to its success in achieving its aims (Horn and Mavroidis, 2014). In practical terms, the division between ‘trade’ and ‘non-­ trade’ has shaped the issues that the CTE has negotiated, addressed further below. The Decision on Trade and Environment also avoided key questions such as the WTO-­compatibility of the NPR PPMs that gave rise to such controversy in the Tuna–Dolphin GATT dispute, as well as the use of trade sanctions for environmental outcomes, either in the context of MEAs or by individual governments. As stated by Parker, ‘The … Committee on Trade and Environment … has declined even to discuss a possible role for unilateral trade measures in obtaining conservation agreements: the Committee’s mandate was deliberately drafted to exclude it’ (Parker, 1999–2000, p. 5). In so doing, the CTE de facto empowered the Appellate Body to develop an institutional position on these issues; it was soon required to rise to the challenge. The 1998 US–Shrimp dispute focused on the US requirement that shrimp fishing operations include a ‘Turtle Excluder Device’ on nets so that endangered sea turtles would not end up as bycatch. Unlike in the GATT Tuna–Dolphin, the WTO’s powerful dispute settlement mechanism bound the US and the complainants, who included Thailand and Malaysia. This ruling is a cornerstone of the narrative that the WTO has made significant environmental progress.14 The Appellate Body departed from Tuna–­Dolphin. It concluded that the US regulation failed to meet the non-­discrimination test imposed by the Article XX chapeau, as the US had not made sufficient efforts to negotiate with, and provide information and technical support to, the complaining countries (WTO, 1998; WTO, 2001a, paras. 163, 166, 172). Thus it critiqued the manner in which the US imposed its regulation, rather than the fact that it had such a regulation at all. In so doing it implicitly accepted the legitimacy of regulatory distinctions based upon NPR PPMs. When establishing that endangered sea turtles were an ‘exhaustible natural resource’, the Appellate Body also made reference to various MEAs and the

162   Emily Lydgate WTO Preamble’s reference to ‘sustainable development’ to justify including living resources in this category (WTO, 2001a, paras. 152, 153, 155). This progressive interpretation15 implicitly deferred to MEA obligations, in particular the Convention on International Trade in Endangered Species of Wild Fauna and Flora’s (CITES) endangered species classifications. Also, in the context of Article XX(g), the Appellate Body wondered whether it was necessary for a natural resource being protected, in this case sea turtles, to exist within the territory of the United States, the country defending its measure. Crucially it acknowledged that a degree of unilateralism is a common aspect of regulations that fall under the subparagraphs of Article XX (WTO, 2001a, at para. 121). But it avoided establishing in principle that unilateral regulation with extraterritorial impacts could be WTO-­legal, stating that there was a territorial ‘nexus’, as sea turtles passed through the waters of the US (WTO, 2001a, at para. 133). Thus the gains of the ruling were presented subtly; environmental activists certainly did not interpret it as an end to the struggle. 2001–present: the Doha Development Agenda Countries undertook final negotiations on the Doha Ministerial Declaration (DMD) against the backdrop of the Battle in Seattle. The ferocity of the protest was unprecedented, and much of it focused on environmental impacts of globalisation.16 There was tremendous pressure on the WTO to respond to this ‘legitimacy crisis’ (Esty, 2002). The successful conclusion of the DMD in 2001 moved forward negotiations on environmental issues by providing the CTE with a specific mandate. Yet, in keeping with the Decision on Trade and Environment, it responds to countervailing goals. The text is organised around the concept of  mutual supportiveness, demonstrating its distinct interpretations: first as assertion, second as selection criterion and finally as aspiration. Paragraph 6 states that: [i]t is the potential impact of economic growth and poverty alleviation that makes trade a powerful ally of sustainable development. The multilateral trading system is an important tool to carry forward international efforts aimed at achieving this goal. The purpose of trade liberalisation and the WTO’s key principle of non-­discrimination is a more efficient allocation of resources, which should be positive for the environment.  (WTO, 2001b) The CTE focuses on ‘triple wins’, sectors in which it is possible simultaneously to liberalise trade, improve economic development and protect the environment. Paragraph 31(iii) calls for ‘the reduction or, as appropriate, elimination of tariff and non-­tariff barriers to environmental goods and services (EGS)’, as the removal of trade barriers to EGS will increase environmentally-­preferable practices (WTO website, 2018b). Paragraph 31 also calls attention to fisheries subsidies (though this negotiation is taking place under the Committee on Rules

Environment   163 (see WTO website, 2012a). The WTO website identifies the removal of fisheries subsidies as a triple-­win (see WTO website, 2012b): they lead to overfishing and benefit largely developed countries, such that liberalisation would have positive environment and development results. In 2014, a sub-­set of largely developed countries who account for the majority of trade in EGS agreed to pursue a plurilateral Environmental Goods Agreement. Given that different countries have different export interests, there has been disagreement about which goods should be on that list. Despite concerns from China in particular, negotiators are optimistic for progress (ICTSD, 2016). Paragraphs 31(i) and (ii) address institutional linkages between the WTO and other Multilateral Environmental Agreements, calling for examination of the relationship between the Multilateral Environmental Agreements and the WTO, with ‘a view toward enhancing mutual supportiveness …’ [emphasis added]. Thus the CTE confronts only one area of potential conflict between environmental and trade obligations: the WTO–MEA relationship. Aside from facilitating information-­sharing, they have made little progress on settling the relationship between WTO obligations and the trade obligations imposed in MEAs. Various countries have made proposals for clarifying the relationship between them.17 Barring consensus, the CTE has simply affirmed that cooperation is better than unilateral action, and that both regimes are worthy of respect. Further, negotiations do not address disputes between MEA Parties and non-­Parties, thus avoiding the most difficult questions arising from clashes of obligations.18 Members have made reference to MEAs in disputes. In the 2004 EC–Biotech dispute between the EU and the US, the EU invoked the Cartagena Protocol on Biosafety (CPB) to justify its precautionary approach to genetically modified organisms. The Panel concluded that the obligations of the CPB did not apply in the dispute because the complainant, the US, was not a party.19 In 2016 India– Solar Cells, in the context of Article XX(d),20 India argued that local content requirements were integral to fulfilling its obligations under the United Nations Framework Convention on Climate Change (UNFCCC). The Appellate Body construed the language of Article XX(d) narrowly in order to conclude that the UNFCCC obligations were not ‘laws and regulations’ as defined by the Article, as they had not been transposed into Indian domestic law (WTO, 2016, at paras. 5.142–5.149). The Dispute Settlement Understanding calls upon Members to clarify WTO provisions in the light of customary rules of interpretation of public international law.21 In reference to this requirement, the Appellate Body famously declared that the GATT ‘is not to be read in clinical isolation from public international law’ (WTO, 1997, p. 17). Further, as discussed above, the Appellate Body called upon CITES to justify an evolutionary interpretation of ‘living’ natural resources. Yet, while there has not been a resolved dispute that dealt with direct conflict,22 the Appellate Body has ruled on treaty conflicts with Regional Trade Agreements, consistently affirming that WTO jurisdiction and obligations prevail over those set out in RTAs.23 Paragraph 32 of the DMD affirms the basis for this pre-­eminence:

164   Emily Lydgate [t]he outcome of the negotiations carried out under paragraph 31(i) and (ii) … shall not add to or diminish the rights and obligations of Members under existing WTO agreements … nor alter the balance of these rights and obligations … (Doha Ministerial Declaration, para. 32) The Appellate Body has referenced similar language set out in the Dispute Settlement Understanding to avoid interpreting or applying treaty commitments external to the WTO. Vidigal argues that the Appellate Body’s approach involves attempting to establish the ‘common understanding’ of WTO Members vis-­à-vis the external international legal rule at stake; evolving norms and subsequent practice inform its interpretation (Vidigal, 2013). This suggests a mixed picture: in the event of a dispute, the Appellate Body would be very cautious about elevating MEA obligations above those of the WTO, but also would attempt to ascertain any ‘common understanding’ of the importance of the objectives it pursued. Formally, there is no hierarchy between MEAs and the WTO, but institutionally the WTO has stronger enforcement mechanisms. As Eckersley has poetically concluded: [j]udged in terms of size and teeth, we might regard the WTO as a large tiger and MEAs as a ragged collection of small cats. The irony is that in the one area where certain MEAs do possess effective sanctions, … they remain vulnerable to legal challenge in the WTO. (Eckersley, 2004, p. 24) Eckersley further argues that simply the existence of the WTO and its dispute settlement system has a chilling effect on MEAs: it dissuades countries from strong adoption of trade restrictions as they know that these can be effectively challenged (Ibid.). In fact, head-­on collision in a dispute is undesirable for both sides. While asserting the pre-­eminence of WTO obligations would contribute to more ‘Battles in Seattle’, deferring to MEA trade obligations in principle would prove controversial among WTO Members. This remains the key area to watch in terms of the WTO’s ability to deliver ‘mutual supportiveness’. In considering specific instances in which environmental regulation comes into conflict with WTO obligations, the Appellate Body inevitably plays a key role in establishing whether mutual supportiveness can be achieved in specific regulatory scenarios. Indeed, Sampson sets out a potential resolution of contradictory assertions that trade liberalisation and environmental protection are mutually supportive, but also threaten one another. He writes: [t]hose promoting the virtues of trade liberalisation would not deny that  trade liberalisation and growth can be harmful to the environment, or that trade liberalisation per se will not necessarily achieve sustainable

Environment   165 development.… The WTO response is that, for benefits to be realised and for trade-­induced growth to be sustainable, national environmental, income distribution and social policies should be put in place. (Sampson, 2005, p. 55) In other words, national environmental regulation is essential to bring about mutual supportiveness. Formally, the WTO supports Members in setting such policies. As the Preamble to the Agreement on Technical Barriers to Trade (TBT Agreement) states: [n]o country should be prevented from taking measures necessary … for the protection of human, animal or plant life or health, of the environment, or for the prevention of deceptive practices, at the levels it considers appropriate. (WTO, 1995, Article 12) In the context of Article XX, the Appellate Body has made clear that the level of protection a Member desires will be respected.24 If desired environmental protection is compatible with WTO obligations, this suggests that less trade-­restrictive means are normally available to achieve the goal. However, as Brack asserted with reference to the Montreal Protocol, trade-­ restriction can be a useful strategy in achieving environmental aims (Brack, 1996). In fact, the existence of direct conflict can be deduced by the Appellate Body’s own approach: under GATT Article XX and loosely analogous provisions elsewhere, notably the TBT Agreement, it undertakes a kind of limited proportionality reasoning (see Lydgate, 2016). This includes examining whether a measure’s structure and application are designed to discriminate against imported products, determining the appropriateness of the means–ends relationship between the regulation and the goal, and assessing the reasonable availability of other measures to achieve that goal. Examining the importance of the regulatory goal at stake implies that more important goals justify more trade restriction. Elsewhere the Appellate Body has utilised the concept of balancing between competing objectives. The Appellate Body Report of US–Clove Cigarettes, a 2012 dispute under the TBT Agreement, concluded that: … the object and purpose of the TBT Agreement is to strike a balance between, on the one hand, the objective of trade liberalization and, on the other hand, Members’ right to regulate … (WTO, 2012a, para. 174, emphasis added) Thus the approach of the Appellate Body mirrors the ambiguity of the CTE regarding the mutual supportiveness of trade liberalisation and environmental regulation. It simultaneously affirms the compatibility of domestic environmental regulation with WTO obligations and recognises that there can be

166   Emily Lydgate trade-­offs between them. Note that the Appellate Body also maintained this mirroring through its careful agnosticism in US–Shrimp on the WTO-­legality of extraterritorially applied domestic regulation. The WTO Secretariat has also continued to feed into ongoing international environmental developments. In 2009 the WTO Secretariat co-­authored a long, detailed report on climate change with the UN Environment Programme (UNEP), which examines ‘linkages’ between trade and climate (Tamiotti et al., 2009). The report does not shrink from controversy: it acknowledges that trade opening contributes to climate change. It also offers a critical assessment of the Kuznet’s curve idea underlying the concept of ‘mutual supportiveness’ between trade and environment; namely, that higher incomes lead to less CO2 emission (Tamiotti et al., 2009, pp. 53–56). This stands in contrast to the Report the Secretariat prepared for the Rio+20 Conference of 2012, which encapsulated debates that remain largely unchanged from the 1970s. One of the main obstacles to concluding an outcome document was developing countries’ concern that pursuing a green economy, a central focus of the Conference, meant sanctioning green protectionism to give rich countries a competitive advantage, and de-­emphasising poverty reduction (UN News, 2012). Recalling the GATT contribution for the UNCED in the early 1970s, the Secretariat’s report provided an outline of what types of environmental regulations countries might adopt, and which WTO provisions were applicable to each situation (WTO, 2012c). It also proposed language for the outcome document, ‘The Future We Want’. The Report incorporated many of these recommendations, stating: [w]e affirm that green economy policies in the context of sustainable development and poverty eradication should: … h) Not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade, avoid unilateral actions to deal with environmental challenges outside the jurisdiction of the importing country, and ensure that environmental measures addressing transboundary or global environmental problems, as far as possible, are based on an international consensus … (United Nations, 2012, para. 58) This demonstrates that the core discourses surrounding the ‘trade and environment’ relationship have not transcended traditional divides. Finally, the 2015 UN Sustainable Development Goals reflect a harmonious conception of the trade and environment relationship, noting that trade, and the conclusion of the Doha Round of negotiations (see WTO website, 2018e),25 will contribute to the achievement of a number of the goals.

Environment   167

Current developments At the time of writing, tectonic shifts are occurring in the global trading system, which are influencing established narratives, likely including those on ‘trade and environment’. The Trump administration has abandoned the post war consensus that trade openness underpinned by a rules-­based system leads to peace and prosperity. Trump has indicated that the US will not follow Appellate Body rulings with which it does not agree (Reuters, 2017), and has attempted to undermine the functioning of the Appellate Body (Elsig et al., 2017). At the time of writing, one year into Trump’s first term, I speculate on relevant implications. New alliances between ‘multilateralists’ The US undermining of the WTO demonstrates what Slaughter describes as a ‘transactional’ view of foreign policy: international institutions are abandoned except when they serve the needs of the moment (Slaughter, 2017). The EU in contrast has positioned itself as champion of the WTO and multilateral trade liberalisation, as celebrated in recent remarks by WTO Director-­General Azevêdo (WTO website, 2017). The US has also announced that it will withdraw from the Paris Agreement; in response the EU and China, another champion of the multilateral trade system, have intensified their commitment to upholding it (Boffey and Neslen, 2017). Thus the WTO and UNFCCC/Paris Agreement are united as international law instruments made newly vulnerable by US opposition. Trump has claimed in the past that China invented climate change in order to damage US manufacturing.26 This rhetoric conflates China’s role as great trade and manufacturing power with its commitment to climate change prevention. Further, the EU and Japan have recently concluded the first trade agreement that commits them to implementing the Paris Agreement (European Commission, 2017a). The EU has been critiqued for climate change unilateralism: exporting its regulatory requirements as a condition of market access (Scott and Rajamani, 2012). In the wake of US withdrawal from the Paris Agreement, some commentators, including then-­French Presidential candidate Nicolas Sarkozy, suggested that the EU should retaliate by imposing carbon taxes on all US products (Kentish, 2016). While such an approach encompasses unilateralism and domestic protectionism, it also responds to concerns that the integrity of the global commitment to addressing climate change will be undermined by the US action. Countries who wish to maintain existing structures of international law in the face of US opposition are united by attempts to shore up these institutions. In such a situation, MEAs and the WTO find the emphasis on what they have in common rather than what sets them apart.

168   Emily Lydgate Trade versus non-­trade issues Trump has depicted trade liberalisation as resulting in US unemployment (see Time, 2016), a perceived failure echoed by other populist movements.27 This charge is led from the right of the political spectrum, an outlook not celebrated by environmental activists. Nonetheless, the attack on traditional assumptions regarding trade liberalisation’s contribution to prosperity signifies a period of deep popular scrutiny of the assumptions behind the WTO and regional trade and investment agreements. For environmentalists, perhaps the best-­case scenario for a period in many ways destructive to their aims would be to prompt constructive re-­imagining of the international trade project by its remaining advocates. There is a settled narrative that WTO law must reconcile trade and ‘non-­trade’ issues, with environment constituting the latter. This division is pervasive in scholarship of international trade lawyers, yet underscores the very dichotomy it seeks to address. Perversely, it narrows the understanding of what trade liberalisation should be ‘about’ by situating environmental protection as an auxiliary concern (Lang, 2007). As documented herein, a more expansive vision of the remit and responsibilities of an international trade organisation is evident in the never-­ratified ITO, which placed employment on equal footing with trade and explicitly deferred to existing MEAs. With both the WTO and MEAs under unprecedented attack, it is a fertile moment to revisit, and shore up, assumptions underlying the ‘trade and environment’ relationship. Ultimately, an attempt to understand these discourses requires reckoning with ideological assumptions polarised among some meaning makers. We must ask: how can we move beyond the limits of ‘mutual supportiveness’?

Conclusion The WTO and major international environmental law treaties, in order to achieve consensus, have found language that simultaneously encourages environmental protection, promotes poverty reduction and enshrines trade opening. I have argued that the concept of ‘mutual supportiveness’ has been useful in this respect, but has underpinned limited environmental ambitions. This raises the question: what would a more ambitious approach to foregrounding environmental protection in the world trading system entail? While a full examination is beyond the scope of these concluding remarks, I outline briefly three potential approaches. The first does not have to do with the WTO at all: a similar aim would be achieved if the system of treaties and international organisations responsible for protecting the environment were strengthened. This would correct the ‘chilling’ effect on MEAs identified by Eckersley (2004): if MEAs possessed equally strong enforcement mechanisms, countries would not prioritise their WTO obligations. Another strategy would be for the WTO to incorporate MEAs with trade obligations as part of the WTO-­covered agreements. This would prevent treaty

Environment   169 conflict and put MEAs on a level playing field. While this approach has obvious appeal, in that relevant MEAs would receive the benefits of the WTO’s strong dispute settlement system, Horn and Mavroidis provide a compelling analysis of some of the administrative and negotiating challenges that would result from an attempt to address trade and environmental goals through a single multilateral organisation (Horn and Mavroidis, 2014). Finally, within easiest reach, the WTO could simply increase the ambitions of its existing agenda. For example, CTE negotiations should be expanded to include fossil fuel subsidies, surely the most environmentally-­meaningful trade liberalisation ‘triple win’ (see Trachtman, 2017). Negotiations on the MEA–WTO relationship should have the goal of deferring appropriately to MEA trade obligations, and should expand to include disputes involving non-­Parties. The WTO should establish stronger institutional partnerships with UNEP and relevant MEAs of the type that led to the 2009 joint report on climate change. In the end, the feasibility of reform comes back to political will. In a WTO-­ sponsored debate, Mark Halle of the International Institute for Sustainable Development stated: … the Preamble [of the Marrakesh Agreement] calls for an approach to trade that is supportive of sustainable development. For a long time this was dismissed as, well sure that is our aspirational goal, but we have business to do. What’s happening is that we are realizing that trade has to serve an ultimate goal, and that ultimate goal is the kind of world we want our children to live in. And I think there’s a real opportunity now to get there. (WTO, 2012b, at 9:08s) In the context of deep structural reform, the WTO’s multilateral strength is also its weakness. It suffers in comparison to many Regional Trade Agreements, which go further in safeguarding domestic environmental laws and MEA commitments.28 On the global stage that the WTO provides, deep divisions remain about what our world should ideally look like and how the world trading system can facilitate its realisation.

Notes   1 The 1929 Convention on Abolition of Import and Export Prohibitions and Restrictions (Prohibitions Convention).   2 For an overview, see WTO website, 2018c.   3 See, e.g.: Despite the current recognition, the original GATT agreement.… did not consider the environmental effects of its trade rules on the production of goods.… This inattention to environmental matters may have been due to the fact that environmentalism was a relatively new concern in national and international policy areas … (Alam, 2005, p. 2) There is likewise little evidence that any of the GATT’s provisions were drafted to advance global environmental interests. This is not surprising, since at the time

170   Emily Lydgate there was little governmental knowledge of, or interest in, domestic or international environmental issues. (Dunoff, 1994, p. 1043) In the immediate postwar period, countries were not concerned with the environment, because they had not yet recognized their capacity to degrade it irreversibly. (Weiss, 1992, p. 86) The latter reference is also drawn from Dunoff (1994).   4 See US Fish and Wildlife Service, ‘The Lacey Act’, available at: www.fws.gov/international/laws-treaties-agreements/us-conservation-laws/lacey-act.html [accessed 26 February 2018].   5 These included the Convention Relative to the Preservation of Flora and Fauna in their Natural State (1933) and the Convention on Nature Protection and Wild Life Preservation in the Western Hemisphere (1940).   6 See Protocol to the Convention, Section III, Ad. Article 4. Available at: www.loc.gov/ law/help/us-treaties/bevans/m-ust000002-0651.pdf [accessed 26 February 2018].   7 See, for example, US–Gasoline (1996), US–Shrimp (1998), Brazil–Tyres (2007), US–Tuna II (2012), and EC–Seal Products (2014).   8 Pavoni argues that mutual supportiveness is the ‘interpretative pillar’ of sustainable development, see Pavoni (2010, p. 662).   9 A useful summary of the dispute is available on the WTO website: Mexico etc versus US: ‘Tuna–dolphin’ (WTO website, 1991). 10 For an overview of the dispute and its aftermath, see Parker (1999–2000), pp. 43–47. 11 For a useful overview of the early evolution of this issue please see Charnovitz (2002). 12 E.g., CITES bans trade in endangered species; the Basel Convention bans export in hazardous waste without meeting particular procedures for consent. 13 E.g., the Montreal Protocol on Substances that Deplete the Ozone Layer bans Parties from importing ozone-­depleting substances from non-­Parties; the Basel Convention prohibits import and export of hazardous wastes between Parties and non-­Parties. 14 This is apparent from reading the WTO website’s presentation of the dispute, (see WTO website, 1998). 15 Although the fact that protecting threatened species was a concern of trade negotiators in the first half of the twentieth century somewhat undermines the Appellate Body’s celebrated evolutionary interpretation. 16 For an overview see ‘World Trade Organization protests in Seattle’, Archives, seattle. gov. Available from: www.seattle.gov/cityarchives/exhibits-and-education/digitaldocument-libraries/world-trade-organization-protests-in-seattle. [accessed 26 February 2018]. 17 While the EU and Switzerland have focused on the possibility of disputes and the need to provide guidance and clarity, Australia, Argentina, the US and several developing countries have focused on the lack of existing conflict and the adequacy of existing rules and principles; for a draft negotiating text that attempts to reconcile some of these positions, see WTO (2011). 18 Doha Declaration (WTO, 2001b), Paragraph 31(i), ‘The negotiations shall be limited in scope to the applicability of such existing WTO rules as among parties to the MEA in question.’ 19 See Panel Report, European Communities – Measures Affecting the Approval and Marketing of Biotech Products (‘EC–Biotech’), WT/DS/291; WT/DS/292; WT/ DS/293, para. 7.75 (WTO, 2006). 20 Article XX(d) applies to measures: ‘necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement …’. 21 Article 3(2), Dispute Settlement Understanding:

Environment   171 … The Members recognise that [the dispute settlement system] serves to preserve the rights and obligations of Members under the covered agreements, and to clarify the existing provisions of those agreements in accordance with customary rules of interpretation of public international law … 22 A longstanding fisheries dispute between Chile and the EU which involved clashing requirements of the GATT and the UN Convention on the Law of the Sea was resolved at the stage of consultations, see WTO (2007b). 23 See, for example, Mexico–Soft Drinks (2006); Brazil–Tyres (2007); Peru–Agricultural Products (2015). 24 It has affirmed this multiple times, e.g. in Brazil–Tyres, where it stated that [Brazil’s import ban on re-­treaded tyres] illustrates the tensions that may exist between, on the one hand, international trade and, on the other hand, public health and environmental concerns arising from the handling of waste generated by a product at the end of its useful life. In this respect, the fundamental principle is the right that WTO Members have to determine the level of protection that they consider appropriate in a given context. (WTO, 2007a) 25 Note also SDG indicator 17.10 at https://sustainabledevelopment.un.org/sdg17 (United Nations, 2017) [accessed 26 February 2018]. 26 See tweet of 6 November 2012, https://twitter.com/realdonaldtrump/status/265895292 191248385?lang=en-gb. 27 E.g. concerns about EU citizens taking UK jobs due to free movement of people and economic integration fuelled the UK vote to leave the EU. ‘Voting to leave the EU could mean more jobs will go to Britons rather than foreign workers, according to research’ (Reynolds, 2016). 28 See EU-­Japan Economic Partnership Agreement, above. CETA also contains a chapter on Trade and Environment requiring, among other things, that Parties should not weaken environmental protection in order to encourage trade and investment (European Commission, 2017b).

References Abbott, K.W. and Snidal, D., 2000. Hard and soft law in international governance. International Organization 54 (3), 421–456. Alam, S., 2005. Trade-­environment nexus in GATT jurisprudence: Pressing issues for developing countries. Bond Law Review 17 (2), 1–26. Andersen, H., 2015. Protection of non-­trade values in WTO Appellate Body jurisprudence: Exceptions, economic arguments, and eluding questions. Journal of International Economic Law 18, 383–405. Boffey, D. and Neslen, R., 2017. China and EU strengthen promise to Paris deal with US poised to step away. Guardian, 1 June. Available from: www.theguardian.com/ environment/2017/may/31/china-eu-climate-lead-paris-agreement [accessed 26 February 2018]. Brack, D., 1996. International Trade and the Montreal Protocol, xvii ed. London: Earth­ scan Ltd. Charnovitz, S., 2002. The law of environmental ‘PPMs’ in the WTO: Debunking the myth of illegality. Yale Journal of International Law 27 (1), 59–110. Charnovitz, S., 2007. The WTO’s environmental progress. Journal of International Economic Law 10 (3), 685–706.

172   Emily Lydgate Dunoff, J.L., 1994. Institutional misfits: The GATT, the ICJ and trade-­environment disputes. Michigan Journal of International Law 15, 1043–1128. Eckersley, R., 2004. The big chill: The WTO and multilateral environmental agreements. Global Environmental Politics 4 (2), 24–50. Elsig, M., Pollack, M. and Shaffer, G., 2017. Trump is fighting an open war on trade. His stealth war on trade may be even more important. Washington Post, 29 September. Available from: www.washingtonpost.com/news/monkey-cage/wp/2017/09/27/trumpis-fighting- an-open- war-on- trade-his- stealth-war- on-trade- may-be- even-moreimportant/?utm_term=.70d818d0e1cf [accessed 26 February 2018]. Esty, D., 2002. The World Trade Organization’s legitimacy crisis. World Trade Review 1 (1), 7–22. European Commission, 2017a. EU–Japan economic partnership agreement. European Commission News, 6 July. Available from: https://ec.europa.eu/commission/news/eujapan-economic-partnership-agreement-2017-jul-06_en [accessed 26 February 2018]. European Commission, 2017b. Comprehensive Economic and Trade Agreement, chapter 24, article 24.5, adopted provisionally 21 September 2017. Available from: http://ec. europa.eu/trade/policy/in-focus/ceta/ceta-chapter-by-chapter/ [accessed 26 February 2018]. Gandhi, I., 1972. The unfinished revolution. Bulletin of the Atomic Scientists 28, 35–38. GATT, 1971. Industrial Pollution Control and International Trade, report by the GATT Secretariat, L/3538, 9 June 1971. Available from: www.wto.org/gatt_docs/English/ SULPDF/90840247.pdf [accessed 26 February 2018]. GATT, 1992. Trade and the Environment, GATT/1529, 3 February 1992. Available at: www.wto.org/gatt_docs/English/SULPDF/91600309.pdf [accessed 26 February 2018]. Horn, H. and Mavroidis, P., 2014. MEAs in the WTO: Silence speaks volumes. International Journal of Economic Theory 10 (1), 147–166. ICTSD, 2016. Ministerial talks to clinch environmental goods agreement hit stumbling block, Bridges 20 (42), 8 December 2016. Available from: www.ictsd.org/bridgesnews/bridges/news/ministerial-talks-to-clinch-environmental-goods-agreement-hitstumbling [accessed 26 February 2018]. Jackson, J.H., 1992. WTO trade rules and environmental policies: Conflict or congruence? Washington and Lee Law Review 49, 1227–1278. Kentish, B., 2016. Nicolas Sarkozy promises to hit America with a carbon tax if Donald Trump rips up landmark Paris climate deal. Independent, 15 November. Available from: www.independent.co.uk/news/world/europe/donald-trump-us-carbon-tax-nicolassarkozy-global-warming-paris-climate-deal-a7418301.html [accessed 26 February 2018]. Lang, A., 2007. Reflecting on ‘linkage’: Cognitive and institutional change in the international trading system. Modern Law Review 70 (4), 523–549. Lydgate, E., 2012. Sustainable development in the WTO: From mutual supportiveness to balancing. World Trade Review 11 (4), 621–639. Lydgate, E., 2016. Sorting out mixed messages under the national treatment principle: A proposed approach. World Trade Review 15 (3), 423–450. Mickelson, K., 2015. The Stockholm Conference and the creation of the north–south divide in international environmental law and policy, in Alam, S., Atapattu, S., Gonzalez, C.G. and Razzaque, J., eds. International Environmental Law and the Global South. Cambridge: Cambridge University Press, 109–129. Milner, H.V., 2005. Why the move to free trade? Democracy and trade policy in the developing countries. International Organization 59(1), 107–143.

Environment   173 Parker, R.W., 1999–2000. The use and abuse of trade leverage to protect the global commons: What we can learn from the tuna–dolphin conflict. Georgetown International Environmental Law Review 12, 1–123. Pavoni, R., 2010. Mutual supportiveness as a principle of interpretation and law-­making: A watershed for the ‘WTO-­and-Competing-­Regimes’ debate? European Journal of International Law 21 (3), 649–679. Reuters, 2017. Trump administration would ignore WTO rulings it sees as anti-­US: FT, 1 March. Available from: http://uk.reuters.com/article/us-usa-trump-wto-idUKKBN16 832U [accessed 26 February 2018]. Reynolds, M., 2016. Three of four EU workers will be kicked out in Brexit. Express, 6 May. Available from: www.express.co.uk/news/politics/667952/EU-Brexit-jobs-BritonsEU-workers [accessed 26 February 2018]. Sampson, G.P., 2005. The WTO and Sustainable Development. Tokyo: United Nations University Press. Scott, J. and Rajamani, L., 2012. EU climate change unilateralism. European Journal of International Law 23 (2), 469–494. Slaughter, A., 2017. The return of anarchy? Journal of International Affairs, Columbia University, 15 March. Available from: https://jia.sipa.columbia.edu/return-anarchy [accessed 26 February 2018]. Stern, D., 2004. The rise and fall of the environmental Kuznet’s curve. World Development 32 (8), 1419–1439. Tamiotti, L., Olhoff, A., Teh, R., Simmons, B., Kulaçoğlu, V. and Abaza, H., 2009. Trade and climate change, WTO-­UNEP Report. Switzerland: WTO Secretariat. Available from: www.wto.org/english/res_e/booksp_e/trade_climate_change_e.pdf [accessed 26 February 2018]. Time, 2016. Donald Trump’s speech on trade. Time, 18 June. Available from: http://time. com/4386335/donald-trump-trade-speech-transcript/ [accessed 26 February 2018]. Trachtman, J.P., 2017. Fossil Fuels Subsidy Reduction and the World Trade Organization. Issue paper, climate and energy, October 2017. Geneva: ICTSD. UN News, 2012. Countries agree to extend negotiations on Rio+20 outcome document. 5  May. Available from: www.un.org/apps/news/story.asp?NewsID=41933#.WZQ kTYqQyLI [accessed 26 February 2018]. United Nations, 1948. Final Act and Related Documents, Conference on Trade and Employment, art. 45, general exceptions to Chapter IV (1)f, and Chapter 1, art. Havana: United Nations. Available from: https://treaties.un.org/doc/source/docs/E_CONF.2_78E.pdf [accessed 26 February 2018]. United Nations, 1992a. Rio Declaration on Environment and Development, United Nations Conference on Environment and Development, 12 August. Rio de Janeiro: United Nations. Available from: www.un.org/documents/ga/conf151/aconf151261annex1.htm [accessed 26 February 2018]. United Nations, 1992b. Report of the United Nations Conference on Environment and Development, chapter 1, Objectives 2.9(a) 3, 3–14 June 1992. Rio de Janeiro: United Nations. United Nations, 1992c. Agenda 21, Conference for Environment and Development, Article 2.5. Rio de Janeiro, Brazil: United Nations. Available from: https://sustainable development.un.org/content/documents/Agenda21.pdf [accessed 26 February 2018]. United Nations, 2012. The Future We Want, United Nations Conference on Sustainable Development para. 58, 22 June 2012. Available from: https://sustainabledevelopment. un.org/rio20/futurewewant [accessed 26 February 2018].

174   Emily Lydgate United Nations, 2017. Progress towards the Sustainable Development Goals, Secretary-­ General Report, E/2017/66. Available from: https://sustainabledevelopment.un.org/ sdg17 [accessed 26 February 2018]. Vidigal, G., 2013. From bilateral to multilateral law-­making: Legislation, practice, evolution and the future of Inter Se Agreements in the WTO. European Journal of International Law 24 (4), 1027–1053. Weiss, E.B., 1992. Environment and trade as partners in sustainable development: A commentary. American Journal of International Law 86, 728–735. WTO, 1991. Restrictions on Imports of Tuna, para. 3.30, not adopted, circulated 3 September 1991. Available from: www.wto.org/english/tratop_e/envir_e/edis04_e.htm [accessed 26 February 2018]. WTO, 1992. Summary of the First Meeting, Held at the International Conference Centre Geneva, SR48/1, 5 January 1993. Geneva: WTO. WTO, 1994a. Ministerial Decision, MTN/TNC/45(MIN), 14 April 1994. Geneva: WTO. WTO, 1994b. Decision on Trade and Environment, 15 April 1994. Marrakesh: WTO. WTO, 1995. Agreement on Technical Barriers to Trade, Article 12. Uruguay: WTO (Uruguay Round). WTO, 1996. Report, Committee on Trade and Environment, WT/CTE/1, 12 November 1996. Geneva: WTO. WTO, 1997. US–Gasoline, Appellate Body Report. Geneva: WTO. WTO, 1998. Import Prohibition of Certain Shrimp and Shrimp Products (US–Shrimp), United States Panel Report, WT/DS58/R, adopted 15 May 1998. Geneva: WTO. WTO, 2001a. Appellate Body Report, WT/DS58/AB/R, adopted 15 June 2001. Geneva: WTO. WTO, 2001b. Doha Ministerial Declaration, WT/MIN(01)/DEC/1, para. 31, adopted 14 November 2001. Available from: www.wto.org/english/thewto_e/minist_e/min01_e/ mindecl_e.htm Geneva: WTO [accessed 26 February 2018]. WTO, 2006. Panel Report, European Communities – Measures Affecting the Approval and Marketing of Biotech Products (EC–Biotech), WT/DS/291; WT/DS/292; WT/ DS/293, para. 7.75. Geneva: WTO. WTO, 2007a. Brazil – Measures Affecting Imports of Retreaded Tyres (Brazil–Tyres), Appellate Body Report, WT/DS332/AB/R, adopted 3 December 2007. Geneva: WTO. WTO, 2007b. Chile – Measures Affecting the Transit and Importing of Swordfish, DS193, settled 13 December 2007. Geneva: WTO. Available from: www.wto.org/english/ tratop_e/dispu_e/cases_e/ds193_e.htm [accessed 26 February 2018]. WTO, 2011. Committee on Trade and Environment in special session, TN/TE/20, 21 April 2011. Geneva: WTO. WTO, 2012a. Measures Affecting the Production and Sale of Clove Cigarettes (US–Clove Cigarettes), Appellate Body Report, WT/DS406/AB/R, para. 174, adopted 4 April 2012. Geneva: WTO. WTO, 2012b. Debate: Trade and sustainable development. Held 18 June 2012. Geneva: WTO. Available from: www.youtube.com/watch?v=Ly5FsL_dpbI [accessed 26 February 2018]. WTO, 2012c. Harnessing trade for sustainable development and a green economy. V. Green economy measures and guarding against trade protectionism, 9. Geneva: WTO.  Available from: www.wto.org/english/res_e/publications_e/brochure_rio_20_e. pdf [accessed 26 February 2018].

Environment   175 WTO, 2016. India – Certain Measures Relating to Solar Cells and Solar Modules, (India–Solar Cells), Appellate Body Report, WTO/DS456/AB/R, paras. 5.142–5.149, adopted 16 September 2016. Geneva: WTO. WTO website, 1991. Mexico etc. versus US: (Tuna–dolphin), not adopted, circulated 3 September 1991. Available from: www.wto.org/english/tratop_e/envir_e/edis04_e.htm [accessed 26 February 2018]. WTO website, 1998. India etc. versus US: (Shrimp-­turtle), no. 58 and 61, adopted 6 November 1998. Available from: www.wto.org/english/tratop_e/envir_e/edis08_e.htm. WTO website, 2012a. The Rules Negotiations. Available from: www.wto.org/english/ tratop_e/rulesneg_e/rulesneg_e.htm [accessed 26 February 2018]. WTO website, 2012b. Win-­win-win Situations. Available from: www.wto.org/english/ tratop_e/envir_e/win_e.htm [accessed 26 February 2018]. WTO website, 2017. DG Azevêdo Welcomes EU Trade Ministers’ Strong Support for Global Trading System. 2 March. Available from: www.wto.org/english/news_e/ news17_e/dgra_02mar17_e.htm [accessed 26 February 2018]. WTO website, 2018a. Early Years: Emerging Environmental Debate in GATT/WTO. Available from: www.wto.org/english/tratop_e/envir_e/hist1_e.htm [accessed 26 February 2018]. WTO website, 2018b. Eliminating Trade Barriers on Environment Goods and Services. Available from: www.wto.org/english/tratop_e/envir_e/envir_neg_serv_e.htm [accessed 26 February 2018]. WTO website, 2018c. Regional Trade Agreements: Facts and Figures. Available from: www.wto.org/english/tratop_e/region_e/regfac_e.htm [accessed 26 February 2018]. WTO website, 2018d. The GATT Years: From Havana to Marrakesh. Available from: www.wto.org/english/thewto_e/whatis_e/tif_e/fact4_e.htm [accessed 26 February 2018]. WTO website, 2018e. The WTO and the Sustainable Development Goals. Available from: www.wto.org/english/thewto_e/coher_e/sdgs_e/sdgs_e.htm [accessed 26 February 2018].

11 Justice Clara Brandi

Introduction The former Director-­General (DG) of the World Trade Organization (WTO), Pascal Lamy, believes that the organisation has surprised critics by showing itself to be ‘capable of delivering … trade justice’ (Lamy, 2007).1 This raises the question about how the term justice is conceptualised and how it is made use of in the context of the global trade system. Debates about just and fair trade often focus on the concerns of the weakest members of the trade regime. Exploring questions of justice from that perspective is key in light of the changing global trade system, in which the rising number of bilateral, regional and mega-­regional trade negotiations around the globe make the future of both the Doha Round and the WTO’s multilateral negotiating pillar more uncertain than ever. More than many other terms examined in this volume, justice is an explicitly normative concept. But while there is lively debate in normative theory and political philosophy about what makes trade ‘just’, the use of normative arguments and concepts has hardly been explored in practice. To address this gap, this chapter empirically investigates what statements about procedural and substantive notions of justice made in the normative literature are made in the world trade regime. It also assesses who actually makes what kinds of arguments – i.e. how meaning makers use the term – and how the discursive dynamics regarding justice are evolving. This chapter presents two main arguments: first, throughout the evolution of the world trade regime, trade officials have referred to both substantive and procedural notions of justice in their statements. In doing so, representatives from developing countries and rising powers have tended to make considerably more justice-­related statements. Moreover, while negotiators from industrialised countries have used justice-­related terminology to defend the multilateral trading system as fair, their developing world counterparts have employed the same terms to challenge the system as well as the effects it generates. Second, in the WTO era, justice-­based demands have become less far-­ reaching. Developing country members themselves have focused more on implementation and trade capacity building rather than on the distributive consequences of trade rules. Moreover, the virtues of multilateralism have come to

Justice   177 dominate debates about procedural dimensions of justice, as opposed to earlier calls for greater inclusion of developing countries within the multilateral decision-­making process. This recent shift in the justice discourse has been fostered by the WTO having come increasingly under pressure by the growing number of preferential trade agreements that have begun to undermine the multilateral trade system. The chapter thereby demonstrates how less powerful members of the General Agreement on Tariffs and Trade (GATT) or the WTO use language to voice and reinvent their justice-­related demands over time.2 In developing these arguments, this chapter focuses on the justice-­based arguments made by state members of the GATT/WTO. This discourse has received less consideration than the justice discourse of non-­state actors (He and Murphy, 2007) such as the ‘Global Justice Movement’ (Murphy and Pfaff, 2005; Della Porta, 2007) – which includes non-­governmental organisations like Our World is Not for Sale, Oxfam and the Third World Network – or the media (Boykoff, 2006).3 The chapter is based on secondary sources as well as on the analysis of official statements by GATT/WTO member states during 13 different meetings of the Contracting Parties and Ministerial Meetings in three rounds of GATT/ WTO negotiations – the Tokyo Round (1973–1979), the Uruguay Round (1986–1994) and the Doha Round (since 2001).

Normative and empirical perspectives on justice in the world trading system This section presents a mind map of four different notions of justice discussed in the literature on normative theory. I discuss both procedural and substantive notions of justice in the WTO and introduce the concept of exploitation, which combines both procedural and substantive aspects of justice (see Table 11.1). These notions present the conceptual frames for empirically investigating how GATT/WTO members speak about justice in the context of the multilateral trade system. Fair treatment I begin with a procedural approach.4 Trade justice entails fair treatment, which could be equal treatment or so-­called special treatment. While the former approach posits that the same rules apply to everyone,5 the latter makes some Table 11.1 Mapping justice-based arguments Conception of justice in trade

Type of justice-based argument

(1)  Fair treatment

Procedural (equal vs. special treatment; formal vs. effective market access) Substantive (sufficiency) Substantive (distributive justice: equality, priority) Procedural and substantive (focus on power)

(2)  Entitlement (3)  Fair exchange (4)  Exploitation

178   Clara Brandi allowance for the trading partners’ different starting positions. In contrast to substantive approaches, special treatment takes account of existing inequalities. But neither of these variants of the fair treatment approach refer to outcomes of the trade rules under consideration. Proponents of equal treatment argue that trade justice entails a commitment to an ideal of formal equality in which all members of a trade regime receive and offer equal treatment.6 Proponents of special treatment claim that providing special rights helps to ensure ‘genuine equality’ (Kymlicka, 1995) since they can eliminate, rather than create, inequalities. This view can thus serve as a basis to justify the rules for Special and Differential Treatment (S&D) for developing countries as formulated in the GATT. From that perspective, S&D for developing countries (Wolf, 1987) is consistent with – indeed required for – justice. With regard to fair treatment, the justice argument can also be linked to the notion of equal trading opportunities. Trading opportunities regarding market access can be understood as the absence of formal trade barriers or as effective trading opportunities. From a justice perspective, focusing only on formal trading opportunities is insufficient because formal market access is not much help when, for example, the infrastructure is inadequate. In contrast to introducing tariff reductions, implementing obligations in the so-­called ‘new areas’ requires building institutions and, for instance, creating or improving the infrastructure needed for increasingly complex certification and testing procedures (Finger and Nogués, 2002). Numerous WTO members, especially poor countries, lack infrastructure like proper testing facilities (Hoekman, 2008) and thus have fewer chances to benefit from market access than other countries. A mutually beneficial trade regime cannot be established if those who have difficulties benefiting from it receive no help: in WTO negotiations, assistance in creating or improving certain types of trade infrastructures should be viewed as a necessary complement to market access (Brandi, 2014). Entitlement Going beyond procedural approaches, justice in trade can also be examined through the substantive conceptions of entitlement and fair exchange. Entitlement conceptions consider that trade must be structured in ways that do not violate both partners’ basic human right to a minimally decent standard of living (Miller, 2010). Entitlement conceptions that include subsistence rights are sometimes considered to be too demanding because such conceptions ‘burden’ trade that is held to be generally responsible for fulfilling rights with a broad variety of policies (Risse, 2007). Entitlement conceptions may also be seen as demanding too little by ignoring the resulting distribution of trade gains and being non-­ comparative. For example, a multilateral trade agreement might ensure a WTO member state enough trade gains for a minimally decent standard of living that fulfils basic rights (the principle of sufficiency) – yet be unfair to the member who receives too small a share of the overall value of the trade gains.

Justice   179 Fair exchange This brings us to fair exchange conceptions of trade justice, which state that exchanges must generate a specific distribution of resources or benefits between trading partners. Fair-­exchange conceptions might define trade as ‘just’ when the benefits are distributed among the parties according to specific principles like equality (e.g. James, 2012). One key argument is that while individual trade interactions may only have to fulfil minimal moral demands such as the absence of coercion, social practices subject to collective governance (James, 2012) should be more demanding: trade gains are a jointly produced surplus that should be divided fairly among those who generate them.7 Fair-­exchange conceptions typically embody a notion of distributive justice, which usually refers to relative or comparative understandings of justice expressed in terms of equality. Entitlement conceptions, on the other hand, usually do not entail a relational or comparative approach. They demand that WTO members should receive enough gains from trade through multilateral trade agreements to fulfil the principle of sufficiency (Frankfurt, 1987). While substantive approaches can entail a concern with non-­relational sufficiency (entitlement) or relational equality (fair exchange), they might also embody a concern for the worst off, which is in line with a priority view (Parfit, 1997), for example, which demands that the poorest for the least developed countries should receive certain specific benefits. Exploitation Finally, normative concerns in the WTO can be linked to the notion of power and the concept of exploitation, i.e. the notion of ‘taking unfair advantage’ (e.g. of power inequalities), which combines both procedural and substantive dimensions of justice. In the context of the global trade regime, we should focus on interactions that must be regarded as exploitative although they are mutually beneficial interactions agreed by both parties. This is highly relevant to the WTO – both with a view to its objective of fostering mutually beneficial trade agreements and in light of the WTO’s consensus principle. How can apparently voluntary and mutually advantageous interactions be exploitative? This happens when both parties benefit in comparison to the non-­agreement baseline but the gains are unfairly distributed to one party (the substantive dimension) and the process of the interaction is morally defective (the procedural dimension). The most relevant case in trade negotiations is an agreement reached because the strength of one party’s bargaining power induces the other to engage in a relatively less beneficial exchange (Brandi, 2014). The WTO case underscores that free and fair agreements must offer more than the absence of direct coercion; they must be concluded under conditions that ensure that both parties have strong enough bargaining powers to shape the agreement – or reject it (Ronzoni, 2009).

180   Clara Brandi

Discursive dynamics around justice in the GATT/WTO system This section analyses how GATT/WTO members themselves speak about justice. It asks: do GATT/WTO members use these four notions of justice (see Table 11.1) – and to what extent?8 In the first part, I explore the discursive dynamics regarding the notion of justice during the GATT era and, in the second part, since the establishment of the WTO. My analysis reveals that GATT/WTO members use justice-­based arguments that are relevant in normative discussions on trade justice. GATT/WTO members refer both to less demanding procedural justice arguments (e.g. regarding fair treatment and trading opportunities) and more demanding substantive principles of justice, which typically concern two types of notions: that poor individuals or countries should benefit from trade gains in order to fight poverty and ensure a minimally decent standard of living (sufficiency, entitlement conception) and that trade gains should be fairly, justly, equally or equitably distributed (distributive justice, fair-­exchange conception). The empirical analysis of concerns about justice voiced by GATT/WTO member states reveals that their absolute number per summit and the share of justice-­based statements has changed considerably. There were many statements about justice particularly during the early phase of the Doha Round of multilateral negotiations (see Table 11.2). Moreover, delegates from developing countries have uttered the most statements about justice, while negotiators from the rising powers Brazil, India, China and South Africa have made fewer and delegates from industrialised countries have made the least references to justice.9 While the number of justice-­based arguments increased rapidly and strongly at the beginning of the Doha Round, a more prominent justice discourse does not mean that justice plays an increasingly important role; just talking about justice does not make the WTO more just. We need to take a closer look at the justice discourse in the world regime and how the term justice is made use of in that context. The GATT period Before the WTO was created in 1995, international trade was managed in seven multilateral negotiating rounds under the auspices of the GATT. A closer look at the statements made during the GATT period reveals that while many statements refer to more general concepts or arguments about justice, the content of justice claims evolves over time. It becomes apparent, moreover, that negotiators from developing countries typically have been more vocal and evaluated the world trade regime as less just compared to delegates from industrialised countries – who often praised the system. At first, multilateral negotiations involved little talk of justice. However, the discourse evolved as GATT membership changed (Dunoff, 2003) and along with the intellectual, economic and political context, including the development of

21 11 19

83 99 47 33

1986 1989 1994

Uruguay (GATT)

Doha (WTO) 2001 2005 2009 2013

5 6 2 4 6 8

1973 1974 1976 1977 1978 1979

Tokyo (GATT)

Justice-based statements (number)

Year

Trade round

60 62 37 27

28 36 18

 8

54 by developing countries, 10 by rising powers, 19 by OECD countries 86 are by developing countries, 4 by rising powers, 9 by OECD countries 40 by developing countries, 3 by rising powers, 4 by OECD countries 23 by developing countries, 3 by rising powers, 7 by OECD countries

15 by developing countries, 6 by rising powers, 1 by OECD country 5 by developing countries, 3 by rising powers, 3 by OECD countries 13 by developing countries, 3 by rising powers, 3 by OECD countries

N.A. N.A. N.A. N.A. N.A. N.A.

Justice-based statements Who voiced the justice-based statements? (% of statements during that year)

Table 11.2 Discursive dynamics and meaning-makers

182   Clara Brandi dependency theory in the 1960s. The 1964 United Nations Conference on Trade and Development (UNCTAD) promoted the agenda of the New International Economic Order (NIEO), fostered debates about fair trade rules in the 1970s and contributed to the principles of non-­reciprocity and S&D for developing countries. The dominant discourse promoted by developing countries focused on the industrialised countries’ responsibility to establish a new set of fairer trade rules that would help developing countries to join the global trade system (see Weinhardt and Geck, this volume). In 1964 the GATT had been amended to include Part IV on Trade and Development, which introduced non-­reciprocity and S&D. In 1979, the so-­called Enabling Clause legalised UNCTAD’s Generalized System of Preferences (GSP) for developing countries. However, industrialised countries continued to negotiate reciprocal tariff cuts among themselves. Although these cuts were extended to all member states based on the most-­favoured nation principle, they generally did not include the sectors of greatest concern to developing countries – especially the heavily protected textile and agricultural sectors. During the Tokyo Round negotiations from 1973 to 1979, efforts were made to progressively reduce tariffs but particular concerns of developing countries, especially agricultural subsidies, remained unaddressed. In terms of procedural dimensions of justice, fair opportunities for developing countries to participate in the negotiations were mentioned several times during the Tokyo Round. In terms of substantive notions of justice, during the Tokyo Round a number of statements by developing countries emphasised their particular position in the world trading system. But many statements tended to be general calls for fair trade relations, such as trade rules that were fair to all countries, and not only to industrialised ones. Delegates did for instance point out that developing countries were most strongly affected by protectionism, for example in the textile sector. Only few references to distributive justice explicitly referred the outcome of the negotiations and the resulting distribution of trade gains – in line with the fair-­exchange conception.10 The limited number of justice claims made during the Tokyo Round is surprising considering that the NIEO debate reached its peak in the mid-­1970s. That said, fewer developing countries were actively involved in the Tokyo Round than in later negotiations. Another possible explanation for the lack of justice claims in WTO negotiations is that such concerns were mainly raised in the context of UNCTAD, not in the multilateral trade system. In 1986, the Uruguay Round was launched, the first set of negotiations in which developing countries played an active role, and the most ambitious negotiations to date. Moving beyond merely reducing tariffs, the Uruguay Round expanded the GATT’s legal competences to new areas. Increased market access for textiles and agriculture – of particular concern for developing countries that wanted to export – was tied to major commitments in new areas such as investment, competition and intellectual property (Finger and Nogués, 2002). During the Uruguay Round, there were several references to substantive notions of justice – more than in the Tokyo Round. Most were made by developing countries and very frequently expressed justice concerns in terms of fair

Justice   183 exchange and distributive justice, voicing concerns about the distributive impact of trade rules and the trade regime. For the first time, there were demands that developing countries should not be disadvantaged by unequal treatment. Especially in 1986, at the beginning of the Uruguay Round, many statements criticised the lack of equal treatment and demanded a more level playing field.11 For example, the delegate from Turkey stressed, ‘[n]o new system … will hold together unless it provides equitable and balanced gains to all concerned. Therefore, if the Uruguay Round is to succeed, there must be a balanced package’ (GATT, 1989b). In absolute terms, developing country members also made more demands for S&D during the Uruguay Round than during the Tokyo Round, reflecting their increased active participation. The unfair use of bargaining power was also criticised, especially by developing countries, thereby voicing concerns about exploitation that combines, as spelled out above, both procedural and substantive aspects of justice. A number of references were made to whether ‘might is right’ and to terms of trade that were ‘imposed’ by the powerful. In 1986, one delegate pleaded that international economic relations should be ‘different from those existing today, in fair international co-­operation, in an equitable order, … in the eradication of political pressures, in abandonment of the idea that might is right’ (GATT, 1986a). During the same meeting, the Nigerian delegate stated that the persistence of the unjust and inequitable international economic system, constitute[s] a major impediment to the development process of most of the developing contracting parties.… We have to once again consider seriously the problem of … unfair trade terms continually imposed by the major industrialized nations. (GATT, 1986b) Members from industrialised countries, to the contrary, tended to use justice-­ related statements to emphasise the achievements already made. For example, the Japanese representative stressed Japan’s ‘growing faith in the utility and effectiveness of the GATT’ and the ‘fair and just settlement of disputes’ (GATT, 1989a) and at the end of the Uruguay negotiations, the Australian representative stated that ‘Australia is enthusiastic about the Round outcome, … contributing to the historic achievement on Agriculture, whereby rational and equitable GATT rules will apply for the first time to this sector’ (GATT, 1994). In short, while industrialised countries stated that the GATT system itself stands for justice, developing countries argued that the GATT system needs to change in order to take justice and fairness considerations into account.12 Towards the end of the Uruguay Round, many developing country member states started to make justice-­based arguments about the so-­called new areas, including intellectual property rights, arguing against their inclusion in the final agreement. Many developing countries were concerned that the new areas would involve special challenges and uncertain benefits for them. They were concerned that the terms of trade are imposed upon them despite

184   Clara Brandi consensus-­based decision-­making, which mirrors normative arguments about exploitation: free and fair agreements must be about more than the absence of direct coercion. They have to ensure that both parties have enough bargaining power to shape the terms of the agreement or reject it without suffering overwhelming costs. This was relevant during the Uruguay Round, at the end of which the WTO was established: when most developing countries stated that they would not sign the deal that was on the table that included cost-­inducing new standards and rules for intellectual property rights, the US and the EU withdrew from GATT; in 1995 they joined its successor, the WTO, which they had constructed as a so-­ called Single Undertaking in which ‘nothing is agreed until everything is agreed’. Reluctant member states were forced to sign the whole package of new WTO obligations or to be left out (Brandi, 2014). Some developing countries would have preferred the old GATT to the new WTO but accepted the latter because they would have been even worse off as members of GATT without the USA and the EU (Steinberg, 2002). Yet, at the time the notion that trade justice presupposes a fairer set of rules for developing countries who should be granted S&D began to lose favour, undermined by the neo-­liberal push to open up developing country markets (Lang, 2011) that was supported by meaning makers from institutions like the World Bank and the International Monetary Fund (Winslett, 2016).13 The WTO Doha Development Round After GATT negotiations had determined the rules for international trade until the end of 1994, the WTO’s creation in 1995 marked the biggest reform of international trade since the Second World War. In 2001, the WTO launched the ambitious Doha Development Round, which was to make globalisation more inclusive and help the world’s poor. Doha began with a debate about what a ‘development round’ is, what a fair and just trade system entails, and who should benefit from the new negotiations in which ways. The kick-­off of the Doha Round raised many expectations, a number of them specifically linked to norms of justice (see also Table 11.2). Representatives of institutions like the WTO and delegates from industrialised countries have continued to typically paint rosy pictures while developing countries have remained more critical.14 Yet, a number of novel types of justice-­related demands arose during the later phase of the Doha Round. The following three perspectives on the justice discourse in the WTO summarise how justice-­based demands by developing countries have evolved and have tended to become less far-­reaching over time – both in terms of notions of procedural and substantive justice. First, since the beginning of the Doha Round, developing countries started to argue more and more for equal treatment, or at least, treatment that does not leave them worse off than before.15 They seem to have given up, at least to some extent, their more ambitious demands for ‘special’ treatment, arguably hoping that the normatively less demanding arguments for ‘equal’ are more likely to

Justice   185 help them advance their needs and interests. While it is controversial to support a fair distribution of trade gains beyond national borders (see e.g. Risse and Wollner, 2015), the notion that it is morally wrong to implement trade rules that work against the poorest and to harm others is not. Instead of advocating for more ambitious S&D, developing countries underlined a normatively and politically less controversial and more consensual argument, namely that justice implies trade rules do not harm poor countries by biasing the playing field against them. Therefore, fair treatment was reinterpreted and the focus shifted to the need for ‘not being left worse off ’ rather than special, i.e. preferential, treatment. As the Argentinian delegate indicated in Hong Kong, ‘clearly, in overall terms, the benefits for developing countries must be greater than their costs, otherwise this will not be seen as the Development Round’ (WTO, 2005a). Second, over time, developing and industrialised countries have begun to link justice to new arguments regarding the implementation of trade agreements. During the GATT period, the notion that developing countries face special implementation challenges was not mentioned, although one delegate cited the problem of ‘the burden of adjustment … being shifted to those least able to bear it’ (GATT, 1978). Then, after the Uruguay Round, more and more developing countries became aware that the new areas are not only less certain to benefit them but also have high implementation costs. Against this background, at the beginning of the Doha Round, several delegates referred to a justice-­based demand for implementation assistance for new trade rules, above all in the new areas. There were also calls for ‘resources and technical assistance for trade capacity building to accompany any agreement on the Bali package’ (WTO, 2013d), including its implementation. In the end, some of these concerns were taken into account; for example, the Bali outcome (2013) on trade facilitation includes provisions for technical assistance and capacity-­building for developing countries that are implementing the Trade Facilitation Agreement. While some developing countries, worrying that implementation costs will be high and might even outweigh the benefits of new trade rules, have been pushing for this new notion of justice, the approach has also gained relevance because it is in line with industrialised countries’ interests. Over the past years, there has been a trend for delegates from industrialised countries to argue that they are safeguarding fairness, even if they do not offer substantial concessions such as exemptions from market opening commitment, by providing developing countries with so-­called ‘Aid for Trade’ that aims to facilitate the implementation of trade policies. Third, procedural dimensions of justice have become more central than before, but have also been toned down. With trade negotiations shifting to the regional and bilateral realm, developing countries seem to emphasise more and more that a key function of the WTO is to provide for a just and inclusive negotiation forum that gives each and every member a chance to participate in shaping the trade rules of the future. In the Doha Round, several statements have been made about how the multilateral system must be strengthened to help smaller and poorer member states in order to prevent the rise of less predictable, 16

186   Clara Brandi fair and inclusive bilateral and regional trade agreements. In more recent years, especially during the Bali and Nairobi ministerial meetings in 2013 and 2015, industrialised and developing countries emphasise that only multilateralism can lead to fair outcomes. India argued for instance that ‘an open, non-­discriminatory and inclusive multilateral trade system contributes to maximizing gains for all its Members. [Other] approaches by definition impinge on the multilateral trade system and cannot be a substitute for it’ (WTO, 2015; for similar statements see WTO, 2013a; WTO, 2013c). One important reason for the changing discursive dynamics in the WTO is that, in the recent past, the multilateral trading system has increasingly been put under pressure due to the Doha Development Round deadlock and the rise of more and larger preferential trade agreements. While a focus on the normative virtues of multilateralism over bilateralism and regionalism is comprehensible, earlier demands about how to improve procedural justice within the multilateral trading system recede to the background. The WTO’s decision-­making process is portrayed as relatively just in comparison to other negotiating fora. Consequently, it is already being considered as fair and as promoting trade justice to merely remain in the WTO rather than discard it in favour of other less inclusive negotiation fora. Similarly, more far-­reaching demands for distributive justice have recently tended to fall more and more from the table, despite the prominence of rising powers that increasingly challenge the dominance of the Quad coalition – Canada, the EU, Japan and the US. While distributive justice claims continue to be made,17 the rise of new discourses on justice has limited the ambition of justice-­based demands voiced by developing countries in the WTO in light of increasingly strong competition for trade negotiations beyond the realm of the WTO and concerns of ‘realpolitik’ having (re-)emerged. For example, at this point, many WTO members would be content if the Doha Development Round were continued at all. More substantive demands for trade rules to contribute to reducing poverty have thus been become less frequently used. This is not to say that more far-­reaching calls for distributive justice were abandoned altogether, but they seem to have lost their pull. This illustrates how bilateral, regional and mega-­regional trade negotiations can be used to pressure less powerful states in multilateral negotiations (Brandi, 2016) and how this is expressed during trade negotiations in imputations about ‘taking unfair advantage’. Given the proliferation of (mega)-regional agreements, many member states at the 2015 WTO Ministerial Conference seem to have been heavily pressured to agree to the Nairobi outcome because the lack of any outcome at all would have further undermined the WTO. One commentator stated that the failure to agree an outcome in Nairobi would have fostered ‘the end of the consensus-­based organisation as a meaningful negotiating forum’ and that if developing countries are ‘not going to play ball in the WTO, the US and EU will pick up the ball and go play somewhere else’ (Guida, 2015). Less powerful countries that are relatively insignificant in terms of economic status and geopolitical position have the most to fear from mega-­regional trade

Justice   187 agreements. Powerful countries are increasingly abandoning the WTO to pursue their interests outside of the multilateral system – which raises important questions concerning justice (Brandi, 2017). African countries, for example, do not belong to any mega-­regional trade negotiation, while the rising powers’ economic and political weight put them in a better position to compete for regional trade partnerships. In sum, many developing countries seem to have given up the fight for more demanding arguments regarding procedural or distributive justice in the WTO and are searching for new, potentially more consensual and normatively less demanding, discursive approaches – and reinventing the content of trade claims in the process. Similar dynamics can also be observed in climate negotiations, where developing countries have largely given up their hopes that their call for taking ‘historic emissions’ into account can be successful. For instance, developing countries have begun to focus less on demands that are linked to the notion of ‘historic emissions’ and are taking a more consensual and more forward-­ looking stance.

Conclusion In the global trade system, justice can be a politically powerful term, pointing at stringent moral duties to evaluate and potentially reform the GATT/WTO system. It is thus important how we define justice in the context of the global trade system – and how the term is used. Against this background, this chapter has provided both a normative mapping of conceptualisations of justice in the WTO and an empirical mapping of the actual patterns of how justice is referred to in the global trade system, exploring how GATT/WTO members speak about justice and demonstrating the discursive dynamics of how conceptualisations and evaluations of justice vary across time. My analysis has illustrated that the term justice is used to refer to different ideas by different meaning makers: while negotiators from industrialised countries tend to stress that the current global trade system is fair, delegates from developing countries are more critical. They repeatedly emphasise the importance of justice and discuss what would constitute a truly just system. In comparison to developing countries, industrialised countries frequently make the argument that the WTO in itself is fair, arguably also to prevent discussion about reform needs and special demands raised by developing countries. My main argument has been that statements about justice in the WTO have not remained stable but have changed over time in ways that have not been adequately explored so far. While the number of justice-­related statements and their ambition, often referring to substantive demands of justice, was high at the beginning of the Doha Round, their quantity reduced and their content became less far-­reaching over time. Moreover, developing countries and industrialised countries tended to make different claims about justice in the world trade system. Developing countries resorted to frequently arguing in favour of less demanding ‘equal rather than special’ treatment, and increasingly accepted that they were

188   Clara Brandi not granted the exemptions they wished for. Instead, they argued in favour of at least receiving assistance to deal with the special challenges they were facing due to the newly agreed trade rules. More generally, developing countries have begun to re-­emphasise procedural rather than distributive dimensions of trade justice, underlining that the WTO offers a more inclusive forum than bilateral and regional trade negotiations do. Industrialised countries, to the contrary, tended to argue that the world trade system has already achieved relatively fair procedures and outcomes for industrialised and developing countries. More recently, there has been a spotlight on industrialised countries as well, with questions of justice and fairness in trade having received new attention in light of US President Trump’s complaints about supposedly unfair trading practices like dumping that China and other countries allegedly make use of. Trump’s statements in the recent past about unfair wage dumping, supposedly practiced by developing countries, underlines this point. The emergence of novel types of arguments about justice and developing countries’ shifting focus in the justice discourse shows how concepts can change (see Introduction, this volume). The analysis of the justice discourse also shows how less dominant meaning makers can reframe issues in normatively less demanding terms and strategically use language to voice their concerns in ways that sound less controversial to the more dominant players. This observation provides food for thought about how we should assess feasibility in the context of justice discourses: should it be viewed as desirable for pragmatic reasons – or problematic from a more principled perspective?18 In the context of the global trade system, there are good reasons to be critical. Whereas a rule-­based trade system is indeed likely to be more just than international trade in the absence of any multilateral trade rules, justice requires the global trade system to fulfil certain normative demands in order to be truly just. The recent development towards ever more bilateral and regional trade negotiations further undermines justice in the global trade system, which already suffers from an institutional fragmentation that enables strong states to dominate weaker ones (Brandi, 2017). This trend is mirrored in the justice discourse in the WTO. Removing more and more trade negotiations from the WTO is problematic from a justice perspective: the less powerful, poorer countries especially need the organisation in order to be heard. They risk losing the most when bilateral and regional negotiations gain momentum at the cost of multilateral negotiations and therefore keep underlining the importance of the multilateral trade system instead of raising more far-­reaching justice-­based demands they might want to voice. This trend is, at least to some extent, a reason for concern. It embodies an emptying of the way the term justice is used in the context of the global trade regime – mostly at the expense of the needs and concerns of weakest members of the system.

Justice   189

Notes   1 I am highly grateful for the very helpful comments from the editors of this volume.   2 I assume that the state actors can use the term justice in strategic ways to ensure that it retains its ‘normative pull’: justice-­based arguments can be ‘unmasked’ as disguising ‘unjustified’ self-­interested positions and be revealed as instances of rhetorical ‘tongue twisting’ (Krebs and Jackson, 2007) that eventually become delegitimised and cease to work in the interest of their meaning-­makers.   3 For a perspective on civil society actors in the world trade regime, see the chapter by Strange in this volume.   4 For a discussion of certain aspects of procedural notions of justice in the context of democracy, including participation and decision-­making, please consult the chapter by Dingwerth in this volume.   5 On equality of opportunity in the WTO, see also Brown and Stern (2012).   6 See Christensen (2015) for a critical discussion of this view.   7 For a critical perspective, see for example Risse and Wollner (2015).   8 The empirical analysis is based on the members’ official statements, all of which are found on the WTO website. The statements were examined through content analysis and the coding of the segments that refer to the terms ‘justice’, ‘fair/fairness’ and ‘equitable/equity’. I very am grateful to Klaus Dingwerth and his team for providing the relevant information. Several dimensions of the concept of justice, broadly conceived, are linked to the term development (see Weinhardt and Geck, this volume).   9 The results displayed in Table 11.2 apply to the statements that were coded for ‘justice’, ‘fair/fairness’ and ‘equitable/equity’ based on relevant keyword searches; statements about ‘fair and equitable’ treatment count as one rather than two justice-­ based statements. Other statements refer to the four perspectives set out above, for example ‘taking unfair advantage’, but do not use these specific terms; they are not listed in Table 11.2 but are considered in the following investigation of the justice discourse. 10 In 1974, one delegate emphasised that the aim should be to ‘establish a fair and more equitable world, in which … the need would be recognized for the granting of additional benefits to all developing countries’ – expressing special concern for the worst off. 11 Turkey, for instance, insisted that developing countries ‘need an equitable and just trade environment free from any obstacles likely to … hinder their economic development efforts’ (GATT, 1986c). 12 Note that another difference is that industrialised countries often link the justice discourse to fair rules for their businesses, which represent a focus on procedural justice. To the contrary, developing countries and rising powers use references to justice in the WTO in terms of more ambitious principles of distributive justice or other more ambitious substantive justice claims. 13 For a more detailed discussion, see the chapter on development by Weinhardt and Geck in this volume. 14 For instance, according to former DG Mike Moore, ‘openness, fairness and predictability are at the heart of the multilateral trade system’ (Moore, 2001) – while many delegates from developing countries expressed doubts about the system’s fairness. A delegate from Honduras emphasised the need for a rules-­based multilateral trade regime that is fair and equitable, that meets the legitimate aspirations of developing countries, especially those with small and vulnerable economies (WTO, 2009b; see also WTO, 2009a). 15 NGOs like Oxfam have also contributed analyses, advocacy and campaigns to this discourse and warned of the consequences of ‘rigged rules’ by calculating how tariffs and subsidies of industrialised countries cost poor countries US$100 billion a year – twice the amount of development aid (Oxfam, 2002).

190   Clara Brandi 16 See also Eagleton-­Pierce (2013) who makes a similar point in the case of cotton negotiations. 17 In Hong Kong, an Indian delegate for instance called for the Uruguay Round’s ‘development deficit’ to be corrected, saying, ‘[i]f the content of this Round only perpetuates the inequities of global trade, then it will be no Round’ (India, 2005). Brazil’s representative pointed to ‘injustices’ in trade and especially how they overlook ‘the structure of privilege’, notably in agriculture, and compound the existing ‘development gap’ (WTO, 2005b). In 2013 in Bali, the South African representative stressed the need to redress ‘the imbalances and inequities that continue to disadvantage developing countries’ (WTO, 2013e) while the Indian delegate said that ‘historical imbalances in trade rules must be corrected to ensure a rule-­based, fair and equitable order’ (WTO, 2013b). 18 This is linked to the ongoing debate in normative theory (e.g. Stemplowska and Swift, 2012) about dealing with demands of justice under non-­ideal (unjust) social and political conditions.

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Index

Acalin, Julien 55 accounting methodologies 60 ACP see African, Caribbean and Pacific group of developing countries activism 97; collective trade 70; environmental 22; research-led 28 activists 17, 38, 41–42, 93, 98, 100–101, 105, 107, 109–110, 112; campaigning 98; civil society 33, 37–38, 45, 88; environmental 162, 168; human rights 41; labour 37; political 98; and Ralph Nader 86 actors 2–4, 6–7, 9–11, 13–18, 22, 25–27, 65, 68, 85, 88, 97–99, 107–108, 110–111, 122–124, 127; business 16, 99; civil society 10, 13, 109; criticised 122–123; emerging 111; external 105; formal 108; groups of 85, 98; institutional 97–98, 108, 111; international 74, 103; legitimate 11; political 32–33, 37, 45; pre-existing 111; social 24; trade policy 18 advisory groups 86, 107 advocacy 99–100, 103, 108–109; efforts to frame their demands for coherence of trade 128; groups 16, 37; organisations 99, 116 AEHT see Amazon Europe Holding Technologies AfDB see African Development Bank African, Caribbean and Pacific 71 African, Caribbean and Pacific group of developing countries 71 African Development Bank 121 agendas 1, 3, 15, 17, 22, 27, 29, 64, 71, 104, 108, 128, 154, 157, 160; existing 169; multilateral trade policy 25; negotiating 17, 87, 92; non-binding 157; political 135; reactionary 72; regulatory 25, 29

agreements 3, 36, 65, 70–72, 82–83, 86, 92, 109, 145, 160, 179, 184–185, 187; bilateral 72; clear 145; collective 68; conditioned reciprocal 71; economic partnership 71, 111; existing WTO 90, 164; fair 179, 184; final 155, 183; freetrade 70; international 66; legal 88; limited 92; multilateral 65, 109, 152, 163; plurilateral 91–92 ‘Aid for Trade’ 121, 140, 185 Alessandrini, D. 132, 136, 141 alter-globalisation movement 80 Amazon Europe Holding Technologies 55–56 ambition 74, 161, 169, 186–187; deep 155; and the Doha Development Round 184; environmental 154; underpinned limited environmental 168 Anderl, Felix 10, 13–14, 16, 115–128 anti-pollution regulations 157 anti-protectionism 40 Appellate Body 154, 161–167; approach involves attempting to establish the ‘common understanding’ of WTO members 88, 125, 164–165, 178, 180; Report of US-Clove Cigarettes (2012 dispute under the TBT Agreement) 165 Argentinian delegates 185 arguments 5–6, 14–15, 22–24, 36–37, 39, 67, 69–70, 80, 83, 89, 123–124, 127, 132, 176–177, 187–188; competing 17; consensual 185; demanding 184, 187; key 17, 83, 179; long-standing 84; new 185; normative 176, 184; progressive 124; vocal 27 Azevêdo, Roberto 69, 91–92 Balance of Payments Manual 51–54 ‘Bali Package’ 69–70, 72, 143, 185

194   Index banks 7, 121; international development 126; multilateral development 121; unspecified development 126 barriers 12, 35, 66; intentional 33; internal 121; major 15, 33; non-tariff 10, 33–35, 37, 45, 67, 137, 156, 162; significant 37 battles 16, 45–46, 73, 102, 144; discursive 16; intense 75 beef (origin labelling) 42–43 benefits 3, 23, 40, 65, 67, 69–71, 73–74, 92, 143, 153–154, 163, 165, 169, 178–180, 183–185; aggregate 68; key 54; presumed 22; public 74; putative 71; relative 70 Berenskoetter, Felix 3–4, 12 Bernstein, S. 25, 118–120, 122 Bishop, Matthew Louis 12, 15, 64–77, 145 Blyth, M. 9, 137–138 Boltanski, Luc 2, 6–8, 117 book values 59, 61 boundaries 2–3, 11, 29, 52, 133, 145–146; of developing country group 140; territorial 23 BPM see Balance of Payments Manual Bradley, Victor 8, 43 Braithwaite, J. 35–36, 39 Brandi, Clara 13, 17, 176–188 Brazil 12, 26, 39, 70, 121, 133–134, 138, 140–142, 146; rising powers of 180; and South Korea 141 Bretton Woods institutions 74, 115, 118–120 Brexit 44, 72 Brown, Gordon 74 business associations 83, 99, 103, 107, 112 businesses 35–39, 42–43, 45–46, 85, 161, 169; domestic 15, 32–34, 37; exporting 32, 34; foreign 36, 43, 45; importcompeting 37, 42; internationally oriented 39, 44; protection-seeking 42 campaigns 17, 26, 28, 99, 101, 106, 108–110; labour rights 93; nationallevel 110; professional activist groups orchestrate 101; public 108 Canada 27, 92, 108–109, 186; meat suppliers 42–43; and negotiating groups 108–109 Canadian–United States Free Trade Agreement 108–109 capital 6, 50, 53–54, 105 capital flows 52, 58 capitalism 22, 24 Cartagena Protocol on Biosafety 163

Carver, Terrell 5 CETA see Comprehensive Economic and Trade Agreement challenges 15, 18, 50, 69, 73, 76, 104, 124; distinctive development 75; environmental 159, 166 China 12, 70, 72–73, 83, 106, 133, 140–143, 146, 163, 167, 180, 188; role as great trade and manufacturing power 167; targeting of 17 civil servants 98–100, 108 civil society 14, 16–17, 71, 85, 88–89, 97–112, 123, 152; accrediting 103; activists 33, 37–38, 45, 88; activities 109; contesting WTO policies 106; global 89; groups 37, 104–106, 111; organisations 27–28, 101, 106; part of 99, 101; representation 88; strategy dilemmas 123 coherence 10, 13–14, 16–17, 26, 115–128; cross-issue 118; demands 127; efforts 128; function 119; institutional 121; internal 119, 123; mandate 119, 121–123, 128; negotiating 117; systemwide 128; terms 125, 127; of trade 14, 16, 116, 118–119, 128; uses of the term 16, 116, 120, 122, 127 Cold War 141 Committee on Trade and Environment 154, 160–163, 165 communities 1, 3, 10, 14, 124; international 139–140, 157; powerful national 86 companies 52, 55, 58, 99; foreign 39, 52, 55; holding 55–56, 58 comprehensive coherence of trade 14, 116, 118–119, 123–124, 127–128 Comprehensive Economic and Trade Agreement 92 conceptions 4, 14, 22–23, 177–178; broadening 124; common 128; entitlement 178–180; fair-exchange 179–180, 182; harmonious 166; substantive 178 concessions 11, 36, 40, 70, 73, 185; development-oriented 141; tariff reduction 137 conferences 16, 81–83, 90, 92, 103–104, 144, 166 consensus 12, 16, 68, 80, 83, 87, 90–92, 117, 152–154, 157, 159, 168; international 157, 166; norm 81, 91–92; principles 16, 90

Index   195 contestation 2, 12–13, 15, 25, 33, 41, 65, 98, 102, 112, 145–146; central 32; ideational 44; increasing 17, 144; political 33, 41, 45; recent heightening of 22, 93 contracting parties 84, 91, 102, 115, 144 Convention for the Abolition of Import and Export Prohibitions and Restrictions (Prohibitions Convention) 155 Convention for the Preservation of Wild Animals, Birds and Fish (London Convention) 155 Convention on International Trade in Endangered Species of Wild Fauna and Flora’s 162 Corbyn, Jeremy 45 countries 41–42, 50, 52–53, 55, 58–60, 65–67, 71, 75, 133–134, 137–144, 146, 152–153, 155–159, 162–163, 167–168; complaining 161; dissuaded from strong adoption of trade restrictions 164; enemy 52; importing 159, 166; impoverished 40; industrialising 121, 141; low-income 127; non-industrialised 141; non-LDC 144; non-OECD 125; poor 75, 121, 125, 137, 139, 142, 178, 185; powerful 72, 186–187; richest 69, 142, 166 CPB see Cartagena Protocol on Biosafety critique 6, 26–27, 84, 86–87, 89, 106, 110, 122–124; common 104, 111; dispersing 124; external 16, 116, 122–124, 128; fundamental 87; internal 116, 122–124; popular 86; process sapping 27; radical 13; shared 111; trade reforms 28 CSOs see civil society organisations CTE see Committee on Trade and Environment CUSFTA see Canadian–United States Free Trade Agreement Daunton, Martin 8 debt 115, 120, 127; crisis 136; external 125–128; indicators 51; problems 121, 126 debtor countries 139 Decision on Trade and Environment 160–162 delegates 1–2, 81, 104–105, 180, 182–185, 187; developing country trade 28; member state 103; raising their voices 1 delegations 83–84, 90, 137; member state 103; official 89 delegitimising policies 34–35

demands 10, 17, 66, 100, 123–125, 128, 132, 134, 137–139, 141, 145–146, 153, 179, 183, 186–187; ambitious 184; common 99; defensive developing country 138; far-reaching 186; framing offensive 139; inspired 137; legitimate 133; minimal moral 179; normative 188; popular 80; substantive 186–187 democracy 4, 12–13, 16, 80–85, 87, 89, 91, 93; American 86; consolidate 82; deliberative 100; discourse 87; domestic 84; framing of 83–84; invoking 83; underming of 86 democratic claims 87, 93 democratic credentials 16, 80 democratic decision-making procedures 14 democratic deficit 85, 90, 92; charges 92; claims 85; discourse 93; slogans 87 democratic frames 16, 80–82, 85, 87, 89, 92 democratic legitimation 80–81, 91–92 democratic processes 83, 87 developing countries 10–13, 25–28, 35–36, 40–41, 67, 69–71, 73–75, 83–84, 86–88, 106–108, 121, 125–128, 132–146, 176–178, 180–188; advanced 143; bloc 133, 141, 146; calling for more co-operation between GATT and financial and development institutions’ 126; categories 142–143, 146; claim there concerns are unheard 146; delegitimised 17; emerging 142; emphasise that only multilateralism can lead to fair outcomes 186; groups of 17, 71, 133, 143; indebted 127; members 93, 106, 134–135, 176, 183; powerful 70; pushing for liberalisation in agriculture 139; representatives 13, 145; status 133–134, 140–143, 146 developing economies 142 development 11, 14, 16–17, 22, 75, 119–120, 125–127, 132–141, 143–146, 156–157, 159, 165, 167, 180, 182; agenda 144, 146; changing meanings of in world trade 132, 134; discourse on 132–133, 135–136, 138–139, 143–144, 146; economic 137; engendering 75; environment for 157; human 75, 118, 124; import-substitution 146; international environmental 166; language of 134, 145; levels of 137–138; meaning of 136; policies 123; post-war 115; processes 183; social 143, 155; subordinating 128

196   Index Devereaux, C. 35–36 DFQF see Duty-Free Quota-Free differential treatment 3, 40–41, 75, 133–135, 137, 143, 178 Dingwerth, Klaus 1–18, 80–93 disagreements 34, 38, 40, 45, 105, 163; internal 109; major 104; political 45 discourses 3, 8–9, 11–12, 15–17, 24, 87, 93, 128, 132–133, 136–137, 139–140, 145, 152–153, 177, 180; academic 3; constructing 127; contentious 154; core 159, 166; dominant 182; emerging 134; existing 153; final 154; hegemonic 118; important 153; legitimation 80, 83; new 25, 142, 186; political 17, 51, 82 dispute settlements 38, 91; legal 72; mechanism for 35–37, 161, 164; system 169 disputes 33, 39, 83, 154, 156, 158, 163–165, 169, 183; bitter 34; first GATT 158; investor-state 106; resolved 163 DMD see Doha Ministerial Declaration Doha 69–70, 83, 91, 120, 134, 143, 181, 184; negotiations 71; stalemate 70 Doha Development Agenda 162 Doha Development Round 132, 134, 138, 140–141, 144–146, 186 Doha Ministerial Declaration 145, 162–164 Doha Round 40–41, 45, 69, 71, 74, 76, 81–82, 89–90, 126, 138–140, 166, 176–177, 180, 184–185, 187 domestic regulations 37, 156; applied 166; internal 156 Drache, Daniel 71 Drahos, Peter 35–36, 39 Drake, William 25 Dunne, Nancy 85–86 Duty-Free Quota-Free 138, 144 Eagleton-Pierce, Matthew 4, 8–10, 12–13, 15, 22, 22–29, 101, 139 Eckersley, Robyn 153, 155, 160, 164, 168 ecological modernisation 153, 157, 160 economic development 55, 127, 132, 135–137, 140, 153, 156–157, 162; real 51, 132, 146; theory 17, 132 economic growth 36, 134, 137–139, 146, 159, 162 economic interests 44, 99 Economic Partnership Agreements 71, 111 economic policies 119, 132, 136–137 economic statistics 51, 61

economic systems 116, 136, 139; global 140; inequitable international 183; open international 159 economic theories 133–134, 146 economies 6, 9, 54, 70–71, 108, 126, 136, 152; developing 142; emerging 133, 142–144; green 166; host 55; liberalised 120; national 87; universal 23 economists 24, 117 Education International (international trade union body) 103 EEC see European Economic Community EGS see environmental goods and services EI see Education International EIF see Enhanced Integrated Framework elections 28, 44 Elkjaer, Thomas 60 emerging countries 40, 133–134, 138, 140, 142–144, 146; ability of 134, 146; large 40; major 69 emerging economies 133, 142–144 emerging markets 93 employees 56–57 employment 68, 80, 155, 168 ‘Enabling Clause’ 1979 135, 140–141 Enhanced Integrated Framework 121 entitlement conceptions 178–180 environment 4, 8, 10, 12, 14, 17, 37, 99–100, 117–119, 125–128, 152–169; positive 163; relationships 152–153, 156, 166; social 13; world trading 1–2 environmental 16–17, 22, 26–27, 37, 41, 85–86, 93, 104, 106, 108–110, 116, 118–119, 124–126, 152–166, 168–169; goods and services 154, 162–163; impacts 27, 157, 161–162; issues 104, 156, 162; and labour regulations 37; laws 86, 169; measures 159–160, 166; objectives 158; organisations 37; outcomes 157, 161; policies 85, 108, 125, 153, 158, 160; protection 16, 104, 110, 116, 152–154, 156–157, 160, 164–165, 168 Environmental Goods Agreement 163 environmental regulation 152, 154, 156, 158, 164–165; criticised 153; domestic 154, 156, 165; growing 153; national 158, 165; new 109; particular 153; proliferation of 157, 159; traderestrictive 160 environmental treaties 153, 155, 157 EPAs see Economic Partnership Agreements European Commission 97, 99, 107, 167

Index   197 European Economic Community 66 European Union 10, 26, 67, 71, 140, 142 export-oriented businesses 32–33, 35, 37, 39, 42, 45–46 export-oriented development policies 136 factories 50, 110 fair exchange conceptions 179–180, 182 fair trade 176 FAO see Food and Agriculture Organization Farage, Nigel 45 FDI see Foreign Direct Investment The Financial Times 85–86 Finger, J.M. 178, 182 First World War 52 Food and Agriculture Organization 126 Foreign Direct Investment 13–15, 50–55, 58–61; brownfield 55; datasets 56; defining 52; in economic discourses 50; investors 52; measurement of 50–51, 60; statistical operationalisation of 52, 54–55; stock 52, 56–57, 59–60; theoretical concept of 51, 54, 60; transactions 59; unlisted 60 foreign investors 53, 55, 60 fossil fuel subsidies 169 France 27, 56–57, 83, 109 free trade 9, 23–24, 36, 44, 66, 77, 80, 86, 115, 117–118, 153, 157; arguments 24; favour of 9, 23; guardian of 2 free trade agreements 10, 28, 145; see also trade agreements GATS see General Agreement on Trade in Services GATT see General Agreement on Tariffs and Trade ‘GATT gospel’ 90, 92 Geck, Angela 13, 17, 40, 132, 132–146, 182 gender 99–100 General Agreement on Tariffs and Trade 1–2, 36–37, 41, 66–68, 81–87, 90–92, 102, 115, 126–127, 132, 134–137, 140–141, 152–161, 177–178, 180–185; agenda 154; dispute settlement body 119; dispute settlement mechanisms 102, 108; founding members 134; framework 134; and the legality of national trade restrictions 158; members 2, 81, 136, 158–159, 180, 184; negotiations 86, 156, 184; and the

Uruguay Round 25; and WTO 80–85, 177, 180, 187 General Agreement on Trade in Services 25, 103, 110 Generalized System of Preferences 36, 67, 135, 182 Geneva 1, 70, 84, 104–105, 134 global governance 6–7, 15–16, 28, 44, 64, 69, 72, 74, 88, 93, 108, 122 global trade 4, 16, 40–41, 50, 64, 97, 99, 107, 137; governance 7, 16, 97–100, 102, 104–112, 117, 123; platforms 138; politics 9, 11, 15, 33, 64, 74–75; WTO’s role in 106 Global Warming Network 86 goals 17, 59, 118, 120, 123, 136–137, 153, 155, 159–160, 162, 165–166, 169; aspirational 169; countervailing 162; development 157; environmental 17, 169; policy 16, 34, 45, 116, 124–125, 128; regulatory 38, 165; social 100 Goodland, Robert 37 governance 28, 74, 97, 111, 117; collective 179; democratic 84; economic 116–117; global 6–7, 15–16, 28, 44, 64, 69, 72, 74, 88, 93, 108, 122 government officials 32–34, 36, 42–43, 45–46 government policies 35 government procurement 33, 37, 40 governments 9, 16–17, 34, 36, 39, 41, 43, 68, 81–82, 86, 89, 103, 109, 143, 161; antagonistic 71; domestic 70; grants 9; national 52, 102; non-democratic 83; withdrawing due to threats to cultural sovereignty 109 Gray, John 13 Great Depression 33, 66, 72 green economies 166 Greenpeace 27, 86 Griffith, Martin 86 gross domestic product 141–143 Grotius, Hugo 23 groups 16, 65, 67, 82, 85–86, 88, 98–101, 103–111, 133, 135, 141, 143, 145, 159; campaign 100; environmental 108, 110; for-profit 99; moneyed 99; non-profit 99, 103; selecting 103; well-resourced 101; working 121 GSP see Generalized System of Preferences Hannah, Erin 4, 10–11, 27, 105, 118–120, 122, 135, 138, 142

198   Index Harrison, C.S. 35–36 Hausmann, Ricardo 59 health regulations 160 Helleiner, Eric 74 Heron, T. 71, 140 Hopewell, Kristen 10–11, 111, 138–139, 142 Horn, H. 161, 169 Hudec, Robert 67, 134–136 human rights 8, 10, 16, 122, 124, 128 IBM 35–36 ICTSD see International Centre for Trade and Sustainable Development ILO see International Labour Organization IMF see International Monetary Fund imports 17, 152, 155, 159 Indian 12, 26, 38, 70, 133–134, 138, 140–142, 146, 156, 163, 180, 186; government 38; resistance 69 industrialised countries 27–28, 67, 141, 176, 180, 182–185, 187–188 inequalities 77, 135–136, 139–140, 178 inflation 24, 51 injustices 141–142; environmental 104 institutional actors 97–98, 108, 111 intellectual property 25–26, 35–37, 45, 56, 182; intensive businesses 35–36; and protectionism 35; regulations 35–37; rights 3, 17, 26, 36, 55, 160, 183–184; rules 22, 25; trade policies 36 International Centre for Trade and Sustainable Development 105, 142, 163 International Conference for a Tariff Truce 1930 33 international economic organisations 12, 88 International Labour Organization 125–126 International Monetary Fund 9, 15, 51–54, 59–60, 88, 115, 117, 119–120, 123, 125–126, 128, 136, 139, 146, 184 international trade policy 27, 145 international trade projects 168 investments 27, 36, 40, 50, 54–55, 58–61, 98, 106, 109, 182; amplified 115; crossborder 52, 54; foreign 59; greenfield 55; long-term 51; minority 58; portfolio 53; round-tripping 58; short-term 52, 58; tax-motivated round-trip 55 investor-state dispute 106 investors 53, 55 IP see intellectual property Ireland 56–57

ISD see investor-state dispute ITO see International Trade Organisation Jackson, Patrick 13, 153 Johnson, M. 2, 5 Johnston, J. 109 justice 13, 15, 176–180, 183–188; arguments 178; based arguments 177, 180, 183; based demands 17, 176, 184–186; based statements 180–181; discourse on 177, 180, 184, 188; distributive 177, 179–180, 182–183, 186–187; notions of 17, 177, 180; procedural dimensions of 177, 182, 185; related demands 177, 184; related statements 176, 183, 187; substantive notions of 176–177, 182 justice claims 180, 182, 186 Kelsey, Jane 25 Keohane, Robert 65 Kornprobst, Markus 6–7 Krebs, Ronald 13 labelling 12, 15, 17, 33, 41–43, 45; demands country-of-origin 43; regulations 43; requirements 12, 33, 41–43, 45; rules 45; standards 41–43 labour 10, 22, 38, 115, 135; regulations 37; rights 100, 104, 106; standards 8, 10, 37, 41, 105, 110 Lacey Act 155 Laclau, Ernesto 117 Lamp, Nicholas 135, 142, 144 Lamy, Pascal 76, 106, 142, 176 Lang, Andrew 9, 25, 117 language 2–11, 46, 82, 86, 88, 116–117, 133, 136, 143, 145–146, 155, 159, 163, 166, 168; assertive 54; democratic 83; identical 153; legal 41; multilateral treaty 154; political 5, 8; and power 7–8; role of 5, 8–9, 17; socio-political 4; technical 11 laws 25, 35, 42, 58, 83, 85, 152, 156, 158; domestic 163; first federal 155; natural 23; origin labelling 42; origin-neutral 156; and regulations 163 lawyers 22, 24, 26 Laxer, G. 109 LDCs see least developed countries least developed countries 40, 75, 121, 138–141, 143–144, 179 Leebron, David 26 legitimacy 16, 28, 68, 81, 83–85, 89–90,

Index   199 97, 100, 108, 111–112, 135, 158, 161; claims 88, 92; crisis 84, 93, 162; democratic 87, 92 liberalisation 71, 74–75, 77, 90–91, 115, 136–140, 146, 163; commitments 134–135, 137–138; general market 138; multilateral 70–71, 90; multilateral consensus-based 92; progressive 2, 90; trade 9, 11, 17, 22, 27–29, 67, 70, 73, 133, 136–138, 152–154, 157, 162, 164–165, 168 Linsi, Lukas 13, 15, 50, 50–61 London Convention (Convention for the Preservation of Wild Animals, Birds and Fish) 155 Lydgate, Emily 12, 17, 119, 152, 152–169 MAI see Multilateral Agreement on Investment Marceau, Gabrielle 103, 105 Margulis, Matias 135–136 market access 71, 136–138, 152, 167, 178 market interventions 137–138, 146 markets 10, 24, 45, 68, 121, 136–137, 139; agricultural 108; developed country 145; emerging 93; global capital 55; important export 153; international 121; local capital 55, 60; national 42; new 37; private 121 Marrakesh Agreement 103, 169 Mavroidis, Petros 161, 169 meaning makers 13–14, 36, 51, 81, 102, 124, 136, 140, 142, 146, 153, 168, 184, 187; academic 135; contested 85; dominant 188; effective 35, 43–44; external 152; important 81; inclined 27; institutional 136; major 24; particular 25, 133; powerful 44; primary 42; relevant 160; significant 40 MEAs see multilateral environmental agreements media 83, 87, 104, 108, 177 member states 11, 17, 83–84, 87–88, 91, 104–106, 119–120, 123–126, 182, 184–186; guarding 110; implementing 119; industrialised 87; monitoring 123; shrimp-exporting WTO 110; statements 83, 90; and statements at GATT Contracting Parties and WTO Ministerial Conferences 83; undermined 10 members 9–10, 65, 73, 75–76, 81–83, 87, 89, 99, 137–138, 141, 159–160, 163, 165, 178, 185–186; core 74; key 73; obligations of 164; powerful 177; radical 89; weakest 17, 176, 188

Merkel, Angela 74 Mexican government 109 Mexican groups 109 Mexico 108–109, 119, 158 MFN see Most-Favoured Nation Mhurchuú, A.N. 4, 13 Mill, James 24 Millennium Development Goals 120 Moore, Mike 52, 85, 110 Most-Favoured Nation 66, 136, 182 movement 70, 100–101; alter-globalisation 80; free 115, 152, 155; global environmental 156; global justice 104, 177; large environmental 109 Mügge, Daniel 51, 61 multilateral environmental agreements 109, 152, 154–155, 159, 161, 163–164, 167–169; commitments 169; existing 168; obligations 162, 164; relationships 163; relevant 159, 169; trade obligations 164, 169 multilateral trade negotiations 66, 81, 93, 180, 186, 188 multilateralism 2, 9, 12, 15, 64–67, 69, 71–77, 90, 92, 176, 186; existing 15; global 73; trade 74–75 Murphy, Gregory 4, 27, 177 mutual supportiveness 153–154, 157–158, 162–166, 168 Muzaka, Valbona 12, 15, 64–77, 145 Nader, Ralph 86 NAFTA see North American Free Trade Agreement Nairobi 90, 92, 186 Narlikar, Amrita 9, 133, 140, 142, 145 ‘narrow coherence’ 116, 118, 122–124, 128 nation-states 50, 99, 107, 159 national development plans 121 national policies 65 national sovereignty 32, 46, 84 national trade restrictions 158 nations 18, 23–24, 36, 44, 54, 86; developed 26–27; powerful 85 negotiations 25–26, 82, 84, 91–92, 106–109, 132, 134, 137, 140, 145, 154, 156, 162–164, 166, 182; ambitious 182; behind-doors 86; development-oriented 145; final 162; inclusive 186; launched 155; multilateral trade 66, 81, 93, 180, 186, 188; new 184; OECD 109; Tokyo Round 182

200   Index neoliberal 9, 34, 117, 136–137; ideas 9, 134, 137–139; terms 138–139 neoliberalism 4, 9–10, 17, 35, 132–134, 136–137, 146 Netherlands 27, 56 New International Economic Order 81, 135, 182 NGOs see non-government organizations NIEO see New International Economic Order Nigeria 183 non-discrimination 66–67, 73, 75, 152, 156, 162; principle of 66, 68, 73, 75; represents the overarching generalised principle of state conduct 65 non-government organisations 16, 37–38, 83, 85, 88–89, 97, 101–105, 111–112, 177; actors 10; relationships 104–105 non-product-related 158 non-tariff barriers 10, 33–35, 37, 45, 67, 137, 156, 162 non-trade 26, 123, 161; issues 116, 153, 161, 168; values 9–10, 26, 83 non-transparency of transnational company ownership structures 58 norms 13, 26, 89, 116, 122–124, 128, 164, 184; of anti-protectionism 40; democratic legitimation 92–93; universal 122 North American Free Trade Agreement 27–28, 109 NPR see non-product-related NTBs see non-tariff barriers OECD see Organization for Economic Cooperation and Development OIE see World Organization for Animal Health Onuf, Nicholas 4–5, 116 Opel, John 36 organisations 16–17, 64, 85–88, 90–92, 97, 101–102, 104, 107, 115, 118–119, 121, 124, 126, 128, 135; advocacy 99, 116; consensus-based 186; democratic 92; global 156; of member states 125; nationfocused 108; new 83; practices 16, 81 Organization for Economic Cooperation and Development 25, 28, 52, 59, 120, 126; member countries 59, 116, 125, 127–128, 181; negotiations 109 Oxfam 27, 86, 118, 123, 177 Paris Agreement 167 Parker, R.W. 159, 161

patents 35–36 Peruvian delegation 84 Pfizer 26, 35–36 Piketty, Thomas 28 policies 3, 32–35, 38–40, 44–45, 60, 87, 115, 118–119, 123, 125, 128, 137, 139, 158, 165; aid 119; co-ordinated 115; collective 65; common 128; designing 111; development 123; environmental 85, 108, 125, 153, 158, 160; explicit 68; fiscal/monetary 125–126; foreign 167; government procurement 33–34; procurement 34; protectionist 33, 40; social 125–126, 165; supportive 120, 124 policy goals 16, 34, 45, 116, 124–125, 128; non-economic 46; plausible public 32; valued public 37 political demands 102, 110; diverse 111; narrower 100; new 108 politics 5, 9, 42, 44, 46, 112 power 2–5, 7–10, 38–39, 44–45, 70, 73–74, 76, 104, 110, 133, 138, 140, 144, 177, 179; corporate 86–87, 106; discursive 15; economic 146; enforcement 107; major 27, 86; negotiating 87; new 12; productive 8; significant 8; social 24; structuring 5; voting 54 Prakash, Aseem 35–36 Pratt, Edmund 36 preferences 32, 35, 59, 66–67, 75, 135; definitional 40; legalised trade 135; national 83 preferential market access 17, 133, 135–136 presidential elections 28 principles 54, 65–66, 88, 116, 118, 124, 135–136, 138, 159, 162, 164, 178–179, 182; basic 139; core WTO 152; demanding substantive 180; legal 152; universal 23 Pro-Canada Network 108 problems 16, 50, 56, 58, 61, 71, 76, 119–121, 124, 126–127, 152, 156, 159, 183, 185; analytical 101; collective 6; conceptual 54; economic 122; fundamental 87; international 69; issuerelated 125; major 119; renewed 27; resolving coordination 39; structural 143; technical measurement 58 procurement policies 34 producers 42, 135; advantaged domestic 40; agricultural 43

Index   201 products 26, 35–36, 41–43, 45, 70, 152, 156; constructed 61; domestic 156; foreign 43; imported 165 protectionism 4, 12, 14–15, 24, 27, 32–45, 67, 72, 158, 182; concomitant 67; constituted 33, 35, 37, 40, 45; definition of 35, 38, 45; disguised 34, 39, 42; domestic 167; ‘green’ 153, 166; illegitimate 43; and intellectual property 35; interwar 66; legitimate 34; meaning of 15, 32–33, 37, 40–41; new 158; social 34; veiled 38–39, 42 protectionist 32–40, 42–43, 45; impact 39; intent 32, 38–39, 43; interests 158; labelled 15, 32, 34, 38; measures 80; ploy 38; policies 33, 40; pressures 2, 11 protests 27, 80–81, 83, 87, 93, 104, 159, 162; domestic 83; public 88–89, 92, 158; Seattle 15, 83, 87, 91–92; street 98, 101, 104 public protests 88–89, 92, 158 Punke, Michael 142 racism 99–100 references 7, 22–23, 82, 84, 89, 102, 117, 123–126, 128, 143, 161, 163, 165, 182–183; explicit 82; first treaty 157; to justice 180 regulations 2, 37–41, 43, 84, 106, 137, 152, 156–158, 161–162, 165; antipollution 157; national 158; new 106, 109; technical 160; unilateral 162 relations 4, 12, 14, 25, 27, 88, 99, 103, 105, 109–110, 125, 140; asymmetrical power 71; groups 103; maintaining power 8; shifting power 12; unequal power 85; working 102 relationships 6, 10, 15, 22, 28, 68, 104, 154, 156–157, 163, 165; economic 56; environment 152–153, 156, 166; evaluating causal 28; mixed 107; postpreference 71; special 115; trade and environment 166; trading 132 Ricardo, David 24 ‘rising powers’ 142, 176, 181, 186–187 Rockwell, Keith 90 Rodri, Francisco 28 Rodrik, Dani 28, 77, 136 Rudd, Kevin 74 Ruggie, John 9, 65, 68–69, 74, 76 rules 4, 35, 38–40, 53–54, 65, 68, 71, 73, 75, 89, 132–139, 142, 145–146, 177–178, 184; clear 59; coherent 118; colonial 135; corporate 80, 89;

customary 163; development-friendly 134–135, 138; external international legal 164; fair trading 123; formal 87; free market 139; international 35, 137; mechanical 54; one-state one-vote 85; phytosanitary 43; preferential 144; special 133 Russia 56–58, 72, 106 Samuelson, Paul 24 Sanders, Bernie 44–45 sausages, issues concerning labelling of 42–43 scholars 13, 28, 133; constructivist-leaning 7, 10–11; trade 154 Scott, James 4, 11, 70, 121, 135, 138, 142, 167 S&D 133–140, 142–146, 178, 182–184; ambitious 185; central concept of 133, 135; for developing countries 137, 178, 182; interpretations of 139, 146; measures 133, 137, 140, 143; purpose of 136–137 Seattle protests 15, 83, 87, 91–92 Second World of communist industrialised countries 141 Second World War 33, 52, 66, 134, 155, 184 Secretariat of GATT 1, 27, 89, 103–104, 120, 166 Sell, Susan 25 Seng, Philip 42 services 22, 25, 34–35, 71, 84, 99–100, 110, 144, 152, 154, 160, 162; classifying 25; commitments 120; incorporated 25; national healthcare 100; trade 25 Shindo, R. 4, 13, 111 Shrimp dispute 161 SIDS see small island developing states Siles-Brügge, G. 11, 66, 71–72, 97, 106 Singapore 103, 126 small island developing states 75 Smith, Adam 22, 24, 27 social construction 6, 33, 41, 111 social movements 85, 87, 92–93, 97, 101 societies 11, 36, 77, 98–100, 104, 112; economic 99; political 98–99, 102 Special and Differential Treatment see S&D 184 special purpose entities 50, 55–56, 58 Special Safeguard Mechanism 138 special treatment 17, 134, 142, 177–178, 184; claim that providing special rights helps to ensure ‘genuine equality’ 178; demanded 135

202   Index SPEs see special purpose entities SSM see Special Safeguard Mechanism states 4, 6, 23, 33–34, 36–39, 41, 44, 65–66, 76–77, 88, 90, 98, 104–105, 127, 159–160; centripetal force pushing 38; developing 35, 40, 105; donor 67; helping 90; industrialised 16; interventionist welfare 68; permanent 73; poor 116; powerful 68, 74, 116, 127, 186; regulations 38; social welfare 9 Stern, Robert 8, 157 Strange, Susan 66 street protests 98, 101, 104 Sturzenegger, Federico 59 subsidies 11, 33–34, 37, 39, 160; domestic trade-distorting 10; fisheries 162–163 sustainable development 12, 17, 26, 118, 154, 157–160, 162, 166, 169 Sutherland, Peter 88, 105 Switzerland 56 systems 13, 17, 27, 66–67, 72, 85, 87, 97, 141, 146, 161, 168, 176, 180, 187–188; conceptual 5; integrated 50; new 183; as a pre-eminent symbolic 8; rules-based 44, 167; unfair 123 Tamiotti, Ludivine 166 tariffs 12, 17, 23, 33–34, 43, 45, 102, 132, 136, 155–156, 162, 182; barriers 45; concessions 67; levels 28; preferential 67; reciprocal 182; reducing 67, 73, 136, 156, 178, 182; schedules 24 Third World Network 105, 109, 177 Tokyo Round 1, 33–34, 37, 81, 84, 134, 138–139, 177, 182–183 TPP see Trans-Pacific Partnership trade 1–5, 7–18, 22–29, 32–33, 36–37, 42–45, 64–65, 106–108, 118–125, 127–128, 132, 152–157, 159–163, 165–169, 178–179; agenda 27, 37; blocking 33; category of 22, 24; complex 101; comprehensive coherence of 14, 116, 118–119, 123–124, 127–128; coordinating 160; curtailed 34; inhibited 34, 37, 41; liberalising 66, 135, 162; megaregional 186; multilateral 3, 66, 69, 74, 76, 89, 91; non-discriminatory 66; regulating 115; terms of 3, 9, 18 trade agreements 69, 105, 108–109, 179, 185; bilateral 66; first 167; foreign 86; multilateral 178–179; new 28, 108; particular 98; preferential 177, 186; regional 92, 152, 163, 169, 186

trade and environment 8, 12, 26, 90, 132, 135–137, 140, 152, 154, 159–162, 166–167, 182; and the idea of ‘mutual supportiveness’ 157; relationships 166 trade barriers 32–34, 38–40, 153, 162; establishing 43; formal 178; primary 33; unfair 45 trade capacity 121, 146, 176, 185 trade curtailment 34, 44–45 trade disputes 90 trade facilitation 40, 185 Trade Facilitation Agreement 2013 140 trade flows 32, 40, 50 trade gains 178–180, 185 trade governance 9, 71, 111, 123; civil society in global 98, 111; contemporary global 102, 112; multilateral 64 ‘trade in services’ 25, 84, 99, 103 trade issues 3, 154, 161 trade justice 176–180, 184, 186, 188 trade lawyers 26; academic 161; international 168 trade liberalisation 9, 11, 17, 22, 27–29, 67, 70, 73, 133, 136–138, 152–154, 157, 162, 164–165, 168; depicted by President Trump as resulting in US unemployment 168; environmentally meaningful 169; multilateral 167; policies 146 trade multilateralism 64–66, 68–69, 73–76; and the Doha Round 69; modern 76; operating 67; pre-Doha 73 trade negotiations 34, 50, 69, 75, 97, 99, 104, 179, 186, 188; free 10; megaregional 176, 186–187; particular 100; regional 188; shifting 185 trade obligations 163, 168 trade officials 38, 176 trade policies 11, 15, 22, 27–28, 32, 34–35, 37, 39, 41, 44, 119, 123–125, 135, 138, 159–160; domestic 29; existing 127; free 128; national 26; sustainable 10 trade politics 2, 4, 10, 14, 25–26, 28, 32–33, 37, 40–41, 44, 46, 71, 98; international 14; multilateral 65; sense of world 2–4 trade regimes 3, 10–11, 17, 75, 124, 128, 134–135, 146, 176, 178, 183; coherent 127; global 116, 118, 179, 188; international 132, 136; multilateral 119; world 4, 11, 13–18, 80–81, 85, 92, 127, 132–134, 136, 139–140, 146, 176, 180 trade regulations 27, 116 trade restrictions 155, 157–159, 164–165

Index   203 trade rules 25, 32, 74, 123, 133, 160, 176, 178, 182–183, 185–186, 188; development-friendly 132; development-oriented 136; fair 182; global 75; international 32; multilateral 188; new 185 trade systems 73, 135, 160, 184; global 161, 176, 182, 187–188; international 161; multilateral 153–154, 160, 167, 177, 182, 186, 188; rule-based 188 trade unionists 26, 97 trade unions 89, 99, 106, 110 trade wars 17, 72 traders 8, 23, 121; free 44; multilateral 10 trading system 27, 158; multilateral 11, 69, 83, 92, 160, 162, 176, 186; open 119, 157; rules-based 139 Trans-Pacific Partnership 28, 70–72, 106 Transatlantic Trade and Investment Partnership 70–72, 80, 92–93, 97, 106–107, 111 transparency 82, 84, 88, 119 treaties 155–156, 159, 168; early trade 155; environmental 153, 155, 157; first modern multilateral trade 152 Trommer, Silke 4, 11, 71, 111 Trump, Donald 28, 44–45, 72, 77, 167–168, 188 TTIP see Transatlantic Trade and Investment Partnership tuna 108, 119, 158, 160–161 turtles 110, 154 Tussie, Diana 27, 140, 142 UN see United Nations UNCHE see United Nations Conference on the Human Environment UNCTAD see United Nations Conference on Trade and Development UNEP see United Nations Environmental Program United Nations 120, 155, 157, 159, 166 United Nations Conference on the Human Environment 156–157 United Nations Conference on Trade and Development 126, 132, 135, 140–141, 146, 182 United Nations Environmental Program 126, 166, 169 United Nations Sustainable Development Goals 2015 166 United States 25–28, 34, 55–56, 59–60, 68, 72, 86, 106–110, 119, 137, 140–142, 158, 161–163, 165–167, 186;

Bureau of Economic Affairs 56; business communities 36; consumer groups 43; Consumer Product Safety Commission 38; Department of State 33; economy 25, 59–60; Environmental Protection Agency 41; environmentalists 158; Government 17; opposition 167; products 167; regulations 161; strategy of linking trade policy to intellectual property standards 26; trade diplomats 3; trade negotiators 36, 107 Uruguay Round 33, 35–38, 40, 69, 81–84, 86, 91, 104, 108, 115, 119, 134, 137–138, 177, 182–185; and attempts by trade officials to split the differences between the two sides 38; of multilateral trade negotiations 81; negotiations 38 US see United States values 8, 13, 50, 59–60, 68, 70, 72, 76, 89, 116, 133, 178; democratic 16, 84; environmental 27; market 59, 61 Venezuelan delegates 82 Vidigal, G. 164 voting rules 16, 81, 89 Wallach, Lori 86 war 5, 23 Weinhardt, Clara 1–2, 4, 6, 8, 10, 12, 14, 16–18, 132–146 Western countries 28, 66, 70 Western governments 36, 68 Wilkins, M. 52 Wilkinson, Rorden 4, 11, 65, 67, 70, 104, 108, 122–123, 138, 145 Winslett, Gary 15, 24, 32, 32–46, 137, 158, 184 Winters, Alan 117–118 WIPO see World Intellectual Property Organization Working Group on Trade, Debt and Finance (Doha) 120 World Bank 9, 28, 88, 115, 117–120, 124–126, 128, 136, 146, 184 World Commission on Environment and Development 1989 157 World Customs Organization 11 world economy 2, 51, 115, 120, 127 world health 85 World Intellectual Property Organization 35–36 World Organization for Animal Health 38

204   Index world trade 2, 14, 33, 81, 137; community 90; discourses 3, 83, 116, 124; order 136; system 17, 91, 187–188 World Trade Organization see WTO world trade politics 2–4, 8–11, 14, 18, 116–117 world trade regimes 4, 11, 13–18, 80–81, 85, 92, 127, 132–134, 136, 139–140, 146, 176, 180 world trading system 9, 12–17, 76, 132, 141, 145–146, 152–153, 168–169, 177, 182 World Wide Fund for Nature 27, 37, 86 WTO 13–18, 38–39, 64–67, 71–73, 76, 80–93, 102–107, 109–110, 115–124, 126–128, 137–146, 152–156, 160–169, 179–181, 184–188; activities 103, 121; Agreement 118–119, 128, 156; bureaucracy 116, 123; coherence mandate 119, 128; and the Committee on Trade and Environment 154, 160–163, 165; compliant 38–39; Contracting Parties and WTO member states 103, 126, 128; dispute settlement mechanism 37; disputes 39, 154; Doha Development Round 28, 184; era 133,

137, 146, 176; and GATT 80–85, 177, 180, 187; and major international environmental law treaties 168; mandate 117, 153; Ministerial Conference 81, 83, 90, 139, 144, 186; and multilateral trade liberalisation 167; negotiations 10, 70, 88, 138, 143, 153, 177–178, 182; obligations 152, 154, 163–165, 168; official communications 81; officials 16, 81, 85, 87–88, 93, 121; provisions 163, 166; and regional trade and investment agreements 168; rules on development 133; Secretariat 12, 16, 97–98, 102–105, 110, 112, 117–118, 166; Secretariat and trade negotiators 154; website 88, 154, 156, 162–163, 166–167 WTO members 17, 88, 92, 120, 125–128, 142–143, 145, 153–156, 164–165, 178–180, 186; in disputes 156; likeminded 85; non-signatory 92; and officials 92; and state delegations 105 WTO Ministerial Conference 16, 80, 82, 92, 103–104; Bali 2013 138; Bali 2013 138; Geneva 1998 104; Nairobi 2015 90; Seattle 1999 80–81, 84, 89, 92–93, 97, 104–107, 109–110; Singapore 1996 103