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JOINT COMMITTEE ON ENTERPRISE AND SMALL BUSINESS debate -
Thursday, 17 Nov 2005

WTO Negotiations: Presentations.

I welcome the Vice Chairman and Deputy Ned O'Keeffe. The item for discussion today is the WTO negotiations. A delegation from the committee will attend the WTO talks. I welcome the representatives from the Department of Enterprise, Trade and Employment and the Irish Congress of Trade Unions, ICTU. Mr. Tony Joyce and Mr. Frank Doheny are from the Department of Enterprise, Trade and Employment, Mr. David Joyce is from ICTU and Mr. Brendan Archbold is from MANDATE.

Before asking Mr. Tony Joyce to commence his opening statement, I draw attention to the fact that while members of this committee have absolute privilege, the same privilege does not extend to the witnesses. Members are also reminded of the long-standing parliamentary practice that they should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable. I ask Mr. Tony Joyce to begin. He will be followed by Mr. David Joyce. Do the witnesses have Galway connections or are they related to the great James Joyce?

Mr. Tony Joyce

There are no Galway connections or relations. We submitted a document to the joint committee in which we outlined the background to the negotiations and the progress made to date. It also described how the EU and Ireland have approached the discussions.

The negotiations were launched in 2001 and were originally scheduled to finish in January 2005. The objective is now to bring them to a successful conclusion in the second half of next year. The meeting in Hong Kong in December is seen as an important stepping stone in meeting next year's deadline. The general view is that if the Hong Kong meeting is not successful in setting the framework for the end of the negotiations, there is little realistic hope of continuing discussion of this type. It is likely, in such circumstances, that the focus of the major participants would shift towards negotiating bilateral or regional agreements and away from the multilateral approach. This would not be particularly welcome from our point of view for a variety of reasons. In such circumstances, the development dimension of the current round of discussions would be completely lost and the interests of the poorest countries would probably not be dealt with in the context of regional or bilateral agreements.

In the document submitted, we emphasised that the negotiations cover a wide range of issues. They were not only the high profile ones like trade in agricultural products and the whole area of agricultural supports but also trade in industrial products, services, overall trade facilitation and the range of multilateral trade rules that are vitally important for world trade, as well as the development aspect I already mentioned.

On the process for the EU, these negotiations fall under the Common Commercial Policy. The European Commission represents the EU in the negotiations and is required, under Article 1.3.3. of the treaty, to keep the member states fully informed and also to negotiate in accordance with the instructions of the Council of member states. The Department of Enterprise, Trade and Employment co-ordinates the Irish input, which is done internally within the EU, and that feeds into the EU common approach. We work very closely with the other Departments involved — the Department of Foreign Affairs and the Department of Agriculture and Food. As members are aware, the Minister with responsibility for trade and commerce will lead the delegation in Hong Kong. The Minister for Agriculture and Food and the Minister with responsibility for overseas development will attend also.

Ireland has consistently supported continued trade liberalisation and the development and strengthening of the multilateral system. We have tried to ensure the development of a strong World Trade Organisation on the basis that it is generally accepted that trade liberalisation has made a significant contribution to our own economic development and will continue to do so. At the same time, in so far as trade liberalisation is concerned, we have sought to ensure that develops fully in line with ongoing internal reform of the Common Agricultural Policy and that the changes made in the CAP internally are fully respected in the WTO.

Given that this is the Doha development round, we have consistently supported work towards a positive response to the developing world and to develop a package of measures for it in a trade context. This overall Irish approach is fully catered for in the EU common approach and in the line followed by the European Commission in the negotiations.

There is an immense amount of detail involved in the negotiations, given that there are up to 150 countries in the WTO. A vast range of issues have to be addressed — economic, political, social, environmental. When the tactical element that is always involved in negotiations of this kind is added, it makes it quite difficult to assess developments and the prospect for success in Hong Kong, in terms of the objective of trying to finish the negotiations next year. Overall, it is important to emphasise that the Government wants to see a successful conclusion to these negotiations and significant benefits to the economy in continuing trade liberalisation in a balanced and equitable manner.

At this point the prospects for success in Hong Kong remain unclear. There has been a lot of activity over recent weeks but not much progress in narrowing differences on the major issues, particularly on agriculture, but the discussions are continuing both within the European Union and in a broader fashion. They will continue up to and including the meetings in Hong Kong and will try to set the scene for the end of the negotiations next year.

Thank you, Mr. Joyce. I welcome Mr. David Joyce.

Mr. David Joyce

I thank you, Chairman, and members for the opportunity to speak to the committee. As Mr. Joyce said——

There is no need to read through the whole submission. Perhaps you would do a summary for members.

Mr. D. Joyce

We submitted two documents to the committee yesterday. One is a global union statement and the other is the ETUC, the European Trade Union Confederation, broad position. I will not go into——

What is the title of the document?

Mr. D. Joyce

There are two of them. The first is Position of the ETUC on the Sixth WTO Ministerial Conference and the other is a summary of trade union proposals.

Which is the one with the Village People logo at the top of it?

Mr. D. Joyce

That is the ETUC document. Like Mr. Joyce, I will not go into the detail of that paper but I am happy to discuss issues that members would like to raise.

As Mr. Joyce said, the expectations for an agreement at Hong Kong are a little unclear and the word we are getting from contacts around the world and from our international organisations is that expectations appear to be downgraded. The view among the trade community is that at this stage the Hong Kong negotiations will not result in sufficient agreement in the key areas of the negotiations. Indeed, there was mention last week at some of the meetings that there may be a Hong Kong II of some description in 2006.

We are in agreement with the Department that it is much more favourable that world trade rules be decided on a multilateral rather than a bilateral basis. Whatever chance developing countries have of getting a good deal is greatly increased in a multilateral system as opposed to being approached on a number of pitches, so to speak, on a bilateral basis.

Many of the meetings last week, and the whole issue of mini-ministerial meetings, have been controversial over the years. The only remark I would make about also week's mini-ministerial meetings, including the one in London, is that in discussing the so-called Doha development round it was notable that there were no African countries in the room, which is problematic in terms of coming up with solutions that lead to greater development opportunities for the poorer countries in the world.

To refer briefly to the employment aspects, one of the first sentences in the document that formed the WTO in 1994 at Marrakesh referred to committing governments in the WTO to raising standards of living, ensuring full employment and a large and steadily growing volume of real income. That came to be known as the "Marrakesh miracle". The question trade unions around the world are asking themselves is if the Marrakesh miracle has come into being. Members will see from both the papers we submitted that the general conclusion is that it certainly has not lived up to the expectations put forward in 1994 and indeed in 1996.

The paper goes into some detail and as Mr. Joyce said, these are very dense issues when one gets into the individual pieces such as the issue of agriculture, which is a key one in terms of reaching agreement; the NAMA, non-agricultural market access, issues; and the GATT in services. The other one I would like to mention is the Mode 4 on the temporary movement of persons for the provision of services. I would stress at this point that it is the general trade union position globally that the WTO is not the place for decisions concerning these kinds of movements of persons and that any offers in this area must include co-operation for the protection of migrant rights, recognised national labour laws, collective bargaining agreements. etc. In that context — we have said this in different committees on different subjects — we believe it would be a very positive step if the EU would consider revisiting the apparent uniform decision across the EU to ratify the EU convention on the rights of migrants and their families.

Next week, meetings of trade Ministers will be held in Brussels and unions will be part of events around those meetings, the objective of which is to show that European citizens and workers throughout Europe are very anxious for the negotiations to succeed and that they would contribute to development and to economic and social justice. Unions will be part of that broad movement in Brussels next week, which is part of the global call to action against poverty, more popularly known in this part of the world as Make Poverty History. Congress has also been part of the Make Poverty History campaign in Ireland.

From Ireland's point of view it is a crucial conference in terms of agriculture.

It might be useful if we disaggregated aspects of this question.

Deputy Lynch asked me to convey her apologies for not being able to make the meeting.

That is noted.

I suggest we disaggregate aspects of this question because the question we put to the ICTU representatives is somewhat different from the technical question we might want to put to the officials from the Department of Enterprise, Trade and Employment.

I will put a number of questions to the departmental officials in regard to the process. I heard a degree of pessimism from the Messrs Joyce regarding the outcome. I would be interested to hear how they measure the temperature of the discussions and whether the idea of a multilateral structure such as the WTO has a future. It seems the United States is less than enthusiastic about multilateralism. It seems to be engaged in a process of bilateral negotiations with individual countries. In some instances, it engages in trade negotiations on the basis of acquiescence on foreign policy matters as, for example, in its bilateral trade negotiations with Botswana. If that is the view of the United States what future is there for such a multilateral organisation as the WTO?

In terms of our negotiating position, I have been involved in UN negotiations in an EU context. It is complicated to maintain the Irish position within an EU bubble when an EU negotiator is leading it. Furthermore, within the expanded Union, I imagine the Irish position is even weaker. Although the Department's document reassures us about the strength of the Irish interest, there is a concern about Commissioner Mandelson leading the talks as there is a UK perspective that might not best suit our interests. I would be interested in hearing the officials' view on that.

I am sure my colleagues who are more specialists in agriculture than I am will want to develop the point I wish to raise. Where is our position on two agenda items, namely, the stated objective of the abolition of agricultural export subsidies and the setting of a date for the total elimination of export support for agriculture? What is the current attitude of the United States and Canada in particular to those proposed developments?

In terms of Mr. David Joyce's comment, what is Ireland's attitude to the developing countries on issues such as sugar imports? From a constituency perspective, I have an interest in our sugar beet industry but I also have an interest in countries such as Mozambique and Uganda which have a vibrant sugar industry and are seeking market access. What is our position on those issues?

It seems that agreement on the patenting of intellectual property rights would be a critical component for our future in terms of the strategy the Department has mapped out for commercialising intellectual property here. At what stage are we in having broad agreements on the protection of such patenting internationally and ownership of such intellectual property rights?

I agree with the Deputy on the patenting of international copyrights, which is most important for our computer industry.

Mr. T. Joyce

The Deputy referred to the degree of pessimism that came across from what I and Mr. David Joyce said.

Not from their written but their spoken words.

Mr. T. Joyce

There has been a fair degree of pessimism in the discussions in which I have been involved in Brussels during recent weeks. However, while there have been differences within the European Union, particularly in relation to agriculture and the way in which member states approach those discussions, a degree of unanimity is emerging in support of the approach Commissioner Mandelson adopted in the past week in terms of the offer on the table from the European Union on agriculture. In most recent discussions in Brussels there was a degree of unanimity in support of the EU position.

What does "a degree of unanimity" mean? It is like the phase "being slightly pregnant". Support for the position is either unanimous or it is not.

Mr. T. Joyce

I will leave aside the words "degree of" and use the word "unanimity". There was unanimity in certain discussions that took place in Brussels in support of Commissioner Mandelson's EU offer on agriculture. The pessimism arises depending on the ambition one has for the Hong Kong negotiations.

In the past week or so the degree of ambition for the Hong Kong negotiations has slightly lowered. People are being reminded that the Hong Kong negotiations were never intended to be the end of these discussions; they were intended to be an important stage in setting the framework for the end. That has become more and more the mantra in recent days. That is not to say that developments will not continue to happen in the run-up to and at the Hong Kong negotiations.

It is difficult at this point to say anything other than that every strong effort will be made across the board from the EU and other participants to make sure there is not a failure in these talks, that a situation does not develop as happened in Cancun or Seattle and that there is an ability to continue these negotiations. There may not be a lessening in the degree of differences between the participants but there will be an effort to continue the discussions.

Regarding the attitude of the United States to these discussions, US participation in them was not strong but about a month ago it put forward an ambitious agriculture offer which took most of the participants by surprise. The US put on the table a detailed and ambitious proposal to reduce supports in the agriculture sector.

Deputy Howlin referred to export subsidies. We have all agreed that export subsidies should be eliminated. What is currently under discussion is the speed at which those subsidies can be eliminated and the end date by which we hope to reach their final elimination. The US is still talking about 2010 in that regard.

The EU position is that it will be parallel to the US-Canada position. The EU will not unilaterally make a decision without that parallel position.

Mr. T. Joyce

I was coming to that point. While the US signalled that 2010 would be an appropriate date for it for the elimination of export subsidies, it has been less than forthcoming in how we would deal with its systems of export support, particularly export credits. We also need to deal with regulation of the operation of state trading entities and how it supports exports in order that we have a parallel reduction in supports for all types of export subsidy.

While 2010 is being talked about by the US as the date by which it hopes export subsidies will be eliminated, we have not yet made progress on how we would treat export credits or state trading entities. Within the EU position, our approach to export subsidies is that we want them to be eliminated in a managed manner within the confines of the way in which the Common Agricultural Policy is being amended. We are focusing on the agreement reached some years ago on Common Agricultural Policy funding up to 2013 and we would like the WTO negotiations to fully respect what has happened in regard to that decision.

The Deputy spoke about the future of the WTO and the multilateral structure. He quite rightly said that the US moved quickly into bilateral negotiations following the failure in Cancun. It took about five minutes after the end of the discussions there before the USTR was engaged in promoting bilateral agreements.

The EU has taken the view that for the time being and while the multilateral negotiations are still ongoing, we should not engage in any new negotiations for bilateral or regional agreements. This policy approach needs to be revisited regularly because there is both economic and social benefit, particularly for the EU, in examining trading relationships with countries around the world.

And in Africa.

Mr. T. Joyce

Indeed.

They are picked off individually around the world.

Mr. T. Joyce

When I said "around the world" I was including Africa. There have been moves within the EU, mainly at the behest of France, in 2003 and 2004, to examine sub-Saharan Africa closely to see what trade measures can be taken that would be beneficial in that part of the world. We have supported those negotiations while at the same time looking towards the sort of interests we have within the Common Agricultural Policy structure and the various product sectors.

The Deputy mentioned sugar but I cannot pretend to be an expert in that industry. I know, however, that the organisation of the common sugar market is currently under detailed discussion within the Union. We are engaged strongly in those discussions both from the point of the EU's external agreements and the internal EU supports that are important for our own sugar producers.

My final point was about intellectual property.

Mr. T. Joyce

The way in which the Deputy dealt with that moved it beyond what we are trying to do within the WTO negotiations, into intellectual property law and so on. I am not particularly au fait with that area.

Within the negotiations, we have been dealing with how the Trade-Related Aspects of Intellectual Property Rights Agreement, or TRIPs, might be amended, particularly with regard to the provision of medicines. I can come back to the Deputy on this point, but my recollection is that we are not making great progress there. We reached a certain agreement in Cancun, which was to be rubber-stamped, on the question of amendment of the TRIPs agreement to provide generic medicines in certain parts of the world. However, the agreement we reached has to a certain extent been put in abeyance. We have not actually concluded it yet and while there are efforts to do so, the issue is not top of the agenda.

This committee would not like to see it used as a bartering tool, which is what I understand happened in the past. It is far too serious for that. In future economic terms, the credibility of our intellectual property, including the protection of patents, will be important.

I welcome both delegations. We also listened to a delegation from the Department of Agriculture and Food. As a farmer myself, I will dwell on the agricultural side of the issue. It appears that agricultural matters must be agreed before further progress can be made, but why is that so? It seems that agriculture must give in first, but that is a complete stumbling block as far as we are concerned.

Commissioner Mandelson has gone too far with those negotiations. The CAP reforms have not been implemented yet because this is the first year that the single payment will be paid out. To do anything with that would be disastrous for rural Ireland. I understand that is in a green box but it should remain there.

The phasing out of export subsidies was raised but we would need a long lead-in time. Since Irish farmers export 90% of their beef and milk products, they would have to sell solely to the EU market because it would not be viable to do otherwise. That is where the export refunds come in.

Perhaps the Deputy could repeat his last point because I missed it.

Some 90% of our agricultural produce is exported. We currently export some of our produce outside the EU to Russia and other places. The only reason we can do that is we have export refunds. Doing away with such refunds, therefore, would need to be achieved over a long period.

The other important point concerns tariff cuts. Commissioner Mandelson has proposed a 60% cut in tariffs, which would mean that non-EU beef could come into the European market more easily. We would then be competing with imported Brazilian beef. If we are talking about improving the lot of the Brazilian people, we would want to know from where such beef imports come. My understanding is that the beef comes from seven or eight major ranches, which is why they can produce low-cost beef. We do not have that type of production here. If we are not careful, therefore, we will find that people in the agriculture sector will have to stop producing beef and milk and depend on the single payment. That would not be good for world trade, however. We hear that people are starving, but if production is stopped there will be less for people to eat. Halting production here will not get food to people at a reduced cost.

I do not know how many people are employed in the agriculture sector but it is very high. From a trade union viewpoint, those people would be hit first because farmers will be able to continue for a certain period. They are on a single payment and do not have to produce goods below cost. They will not do so and it is important that Commissioner Mandelson and people like him realise this fact. We have to make a reasonable living from agriculture or we will not keep producing. Those are the facts. It will not be beneficial for those who are less well off. Currently, the only good aspect of the EU is that reasonably high prices prevail. Therefore, poorer countries get a decent percentage. People say that the only improvement for Brazil is when workers come over here to earn money and then return home. It was mentioned yesterday that a butcher in Brazil earns €90 per month, whereas poor people can earn much more by coming here to work for a few months. It means more to them than their beef exports which benefit only ranchers.

We have widespread food traceability here, but that does not seem to be the case with beef from Brazil or other countries. Ireland should be treated as a special area since were are producing an excellent product.

I thank Deputy Callanan for those interesting questions and call on Mr. Joyce to answer them.

Mr. T. Joyce

I will respond first to the Deputy's question as to why the EU is constantly under pressure to give way on agriculture. I tried to point out, as we did in the document, that there are a considerable range of issues involved in these negotiations. What the Union and we as part of it are looking for is a balanced result that creates obligations which are balanced across the range of issues and also balanced within the agriculture sector for particular participants and in the concessions being made.

It was only after the Uruguay round that trade and agricultural policy became a part of the multilateral system. It is early days for agriculture in that context and that could be taken as one of the reasons there is a concentration on trying to develop multilateral rules for agriculture.

We have been concerned throughout these negotiations to ensure that the Commission, when it engages in discussions on agriculture, sticks closely to the reformed Common Agricultural Policy and to the agreements in place up to 2013. We have closely monitored that throughout these negotiations. The Minister for Agriculture and Food, Deputy Coughlan, has made a number of statements in that regard and in all the discussions in Brussels and elsewhere we have made that one of our important points but we have also put forward a view that we want to see a balanced and fair result to these negotiations. We are prepared to see changes that will take place in the WTO in line with the sort of changes that are taking place in the Common Agricultural Policy.

We agree that the time needed to move towards elimination of export subsidies within the reformed Common Agricultural Policy should be as long as is necessary. We are sure that at present the export subsidies are extremely important in exports of agricultural products to third countries and that a speedy elimination of them would have a serious effect on that trade. Therefore a long lead-in time is necessary.

We have serious concerns about the proposals from the United States and others on market access and the sort of access being sought to the European market. We are happy that the present tabled European Union proposal, which offers serious, favourable and increased access by third countries to the European market, is within the limits of CAP reform. We have been engaged in technical discussions on that matter in Brussels with other member states and with the Commission. Those discussions will continue to ensure that the Commission stays clearly within the limits of its mandate, which is in line with the CAP reform agreements. We still have a concern because that is an area of the negotiations where other countries, such as Brazil which was mentioned by a member, want greater opportunities on the European market. We understand that but we want to see a balance in the concessions made on the European side and in the obligations we take on.

Deputy Callanan made an important point about the development aspects of the Common Agricultural Policy and the various agreements the European Union has with developing countries. These confer great benefits on those countries. There are many instances of developing countries' support for the sort of policies that are followed within the Common Agricultural Policy which, as the Deputy stated, lead to higher prices for imports from the developing world into the European Union. The changes being sought by a number of participants in the WTO negotiations to the Common Agricultural Policy and to the European approach to agriculture would not be ones supported by a large number of developing countries who benefit greatly from the way in which agriculture is managed within the European Union.

Deputy Callanan spoke of the traceability and the health concerns in the case of imports from certain parts of the world. Obviously we would be strongly of the view that the measures in force in the European Union would continue and would be strengthened in a situation of greater access and greater imports from third countries. I hope I have answered the Deputy's questions.

Nobody present will convince me that the WTO is good for Ireland. It cannot be, whether in terms of industry or agriculture. This is a small country with a small capacity to develop. Mr. Mandelson, as head of European trade in the Commission, is one of the most powerful Commissioners in the European Union. He is conscious of drawing water for his own mill which is his backyard in Great Britain, and that is what he is about.

I was in Central America last July. It is the poorest part of the world I ever visited and I have travelled a fair deal. In the past countries like Jamaica and Haiti traded sugar cane and bananas. Such trade has been taken from them. As I see it, there is no benefit for these countries in the trade taking place. I have no brief for any country except my own. These countries lost their sugar cane industry. They have now lost their banana trade because of a trade negotiation between the European Union and the WTO a few years ago. All these small countries, some of which are highly supportive of the United States while others are not, are striving to develop a tourism industry, a point I emphasise.

Deputy Callanan made a good point on the sugar beet industry. Ireland will finish up with no such industry. Whether we here speak as farmers, workers or trade unionists, all these agricultural industries gave significant employment to workers in rural areas and towns. These industries were the backbone of many rural areas. All that will be lost.

I see no benefit for the world in Brazil, Australia, Thailand and such countries fighting this case and getting this concession on sugar. If the sugar price drops to the level envisaged, with cheap sugar there will be no future for the crop in those countries either and we here will have no sugar industry left.

We also will end up with no port industry, which is also a significant employer. Then there is also the threat of avian flu. I am not the oldest man around this table but I remember that in 1950 this country imported 8,000 tonnes of butter. A coalition Government, consisting of three or four parties, was in power at the time and the late Deputy James Dillon was Minister for Agriculture. At my family's breakfast table we used to have Jim Dillon's butter. That is true. Looking back on history, he was a good Minister for Agriculture. The way we are moving, this could all reverse in that direction again because these countries do not have the appetite to produce and have a different outlook.

In this context, we have lost our textile industry. I am told our boot and shoe industry will be gone in five years and Europe's automobile industry will be gone in ten years. These are the projections arising from the statistics of the OECD and other influential European organisations. We are threatened by the developing countries. We hear much about China but nobody speaks of India from where the real development will come in the years ahead. This must be said here. We would want to be protective of our industrial development. We will finish up as the Third World of the modern world if we do not protect ourselves. As I see it, we are going along with every proposal. Low prices do not help the developing countries and I feel concerned about that.

I also want to address the other matter, the non-governmental agencies. Mr. Tony Joyce mentioned that in Hong Kong the Department of Foreign Affairs will be represented from the point of view of the Third World. This country has a conglomeration of non-governmental agencies. I cannot understand why they cannot facilitate each other as one and reduce their administrative costs. I would like to see the presentation of their accounts in a transparent way where we would see what is spent on administration. Recently I spoke to a person who was an ex-employee of one of those agencies. She told me that the amount of money being spent on administration and documentation is frightening. We are throwing money at that again. Members on all sides of the House are being badgered by those agencies for not spending enough money on the Third World. If we are spending money on it, we should curtail the amount of administration and of waste in that area. I cannot understand that such a small country can have so many agencies around the world. While I do not wish to name them, they are there.

I do not see anything good for Ireland. I am not picking at Mr. Tony Joyce or at the representatives of the trade unions who are present, but making the point that Ireland will not come out the winner, either industrially or agriculturally, from the WTO. I outlined what would happen in industry in the years ahead. I come from County Cork, which has fertiliser and steel industries. Ireland has the dearest fertiliser in the world following the IFI closure a few years ago. I am not the third socialist in the Parliament but I like fair play and I like to look after people. We lost our fertiliser industry and the same may happen to the steel industry this year. I do not know whether we are headed in the right direction. I regret I am not part of the committee's WTO delegation but, like a child on a school bus, I am only a concessionary pupil.

A school master would be foolish to accept that last comment because the Deputy has a great deal of expertise and experience. If he wishes to join the delegation, there is no problem but the funds are not available. The Chairman's allowance is not sufficient to include him either, which I regret. Perhaps, we will improve the planning for the next WTO conference.

Mr. T. Joyce

Mr. David Joyce mentioned that most recently there has been talk of a Hong Kong II. Perhaps Deputy Ned O'Keeffe could be part of the delegation to the meeting.

Do not encourage him.

Mr. T. Joyce

However, that meeting will be held in Denmark.

If we can get over Hong Kong I first, we will be okay but I do not think we will.

The Deputy is a former Minister of State and he has made an important point. Is it true that there is nothing good in these talks for Ireland?

Mr. T. Joyce

Our document states that we generally feel that trade liberalisation has been beneficial to Ireland in recent times. We do not say that without evidence and we have carried out a number of studies. Forfás has employed consultants on our behalf and the most recent report was produced by Professor Matthews of Trinity College, Dublin, who concluded in September that, overall, we stand to gain significantly from the developments that will be facilitated by this round.

Trade liberalisation and a strong and certain multilateral trade framework governed by the WTO has contributed significantly to our economic development. The industries and multinationals that have been attracted to this country are very supportive of multilateral trade regulation and the notion of opening markets and creating opportunities.

The Deputy referred to China and India. These countries present important export opportunities. One must consider the change in the framework of the world economy with industries moving from one location to another and new industries developing in different countries depending on the economic framework within which they operate. The economic studies we have carried out highlight that we have gained significantly and will continue to do so from continued trade liberalisation. However, we follow an approach, which acknowledges that but which, at the same time, acknowledges the need for us to ensure the changes that take place in the world trading environment take full account of and fully respect the changes happening within the EU in agricultural support and the way in which other industries are regulated.

I do not disagree with Mr. Tom Joyce but our successful industries are ones that cannot be developed in the Far East such as pharmaceuticals, chemicals and baby food. Ireland's software industry is large but it is inclined to relocate to the Far East. The largest industry in the State is bricks and mortar. How many new manufacturing jobs were created in the past four or five months? I am concerned about my rural constituents and I do not recognise the benefits of the WTO agreement, about which there has been much flag waving. I do not see the benefits of the Doha round for Ireland.

It is fatuous for us to say we will take our ball home and not play. Ireland is an exporter. We export more per capita than Japan. Deputy Callanan stated we export 90% of our agricultural products but 90% of everything we produce is exported. Access to markets is our lifeblood and I am not sure about the notion that Ireland should adopt a protectionist view. We can grow potatoes, feed ourselves and go back to the 1930s. That was tried by de Valera in the 1920s——

Can we get back to putting questions to the delegation?

De Valera was successful in doing it and he did not privatise anything.

He impoverished the country and progress was only made when we began to look outwards.

He made an immeasurable difference but he is not here to defend himself.

We will debate that separately. I do not subscribe to the notion that our national Parliament has anything but a positive view of trade, which is an essential part of our future. Whether I am the third or 93rd socialist in the Dáil, I claim social democracy as my philosophical perspective. I am interested in the negotiation of an agreement that is in the best interest of our workers and that is not protectionist. However, I am also interested in development in the Third World.

A colleague put forward the notion that allowing developing countries access to agricultural products is not the way to go. Their citizens should work in Ireland and then return home. That is anti-development. I work with AWEPA, a parliamentary development group for Africa. I visited parts of Uganda earlier this year where sugar and coffee are grown. Sugar is produced at one third of the cost of production in Ireland. The Ugandans want access to markets and they want to create jobs because they have mills to refine sugar. Many of my constituents depend on sugar beet and there is no alternative crop. Sugar cannot be subsidised three times above world prices to protect an industry. That is not sustainable in the medium or long term.

I have two questions for the ICTU representatives. The strands of the negotiations are complicated. A number relate to peripheral issues while others relate to central issues. I refer to public services harmonisation, about which I am concerned, and the threat to the universal service obligation. How stands that as an item on the negotiations agenda? What is ICTU's perspective on it? As the presentation acknowledged, the cross-border movement of workers is a peripheral issue. The greatest threat we face has two dimensions and we will have to address it.

I refer to the undermining of the rights of workers by EU citizens who earn the minimum wage and are paid flat rates for overtime with no legal basis to prevent that. That undermines existing collective agreements within industries, particularly the construction industry, but it has spread to other economic sectors. That is an extremely difficult issue. If we do not get it right and address it, we will breed incipient racism. We need to make it clear that workers from within the Union are welcome in our economy at Irish rates and conditions and with the protection of agreements that have taken decades to build up. I am interested in hearing ICTU's perspective on that.

Deputy Howlin was talking about sugar from Uganda and such places. The further the price of sugar is reduced, the further we reduce the prices paid to those countries.

No. They produce it as a third-hour crop——

Deputy O'Keeffe, without interruption

That is the bottom line. Price is the lowest common denominator and nobody should tell me anything different. This happened in Central America. I met the poor people there and was appalled by their poverty, from Jamaica ——

Those industries are owned by multinationals.

The people lost out because of trade negotiations. One farmer told me he was a banana producer, but his livelihood was gone because of ——

Banana production is controlled by two companies in the world.

By four, in fact, but we will not argue about that. The point is clear, the further the price of sugar is reduced, the greater the reduction in prices paid to the least developed countries, which will become poorer. The big ranchers and entrepreneurs who live in London, New York, Washington, etc. who own the ranches in Brazil and elsewhere will make more money.

As far as Uganda.

I was in Brazil as well. The rubber industry there is gone. The people's plantations are closed down and the poor people who worked on them live in the shanty towns of São Paulo, Rio de Janeiro, etc. This is what is happening. We run with the crowd and big business, but big business does not always serve the people.

We have two diverging views here, both convincing. I bow to the greater experience of both members. It may be worth examining both views in the future, probably urgently. Both Deputies have visited these destinations and are convinced of what they are saying.

I visited some recently. We are making the rich richer and the poor poorer. I mentioned this during the debate on the Competition Authority. This committee has done great work in the area and the Chairman has contributed to that.

The leading questions should be answered.

In fairness, we must listen to both sides. The Chairman must remain impartial in these matters.

It is only debate between members, but we have invited guests here to answer our questions.

Does Senator Hanafin have questions for Mr. Tony Joyce or ICTU?

I would like to see our Irish representatives take up this issue. Both sides that have spoken are correct on both issues. It is only fair that we should share and allow production. We should not produce surpluses and dump them on Third World markets. However, it is not quite as simple as that because there is a wheel within the wheel. That wheel is that many of the producers — the farmers in Brazil, the plantations and the sugar companies — own the factors of production within the Third World country. If we give the concessions, therefore they do not go to the people to whom we want them to go. Not only that, labour relations are not ideal and there is ill-treatment and exploitation of workers.

I have a serious issue with linking changes in trade to specific demands of where the benefits go for free trade. In principle, free trade is good, but the reality on the ground, the wheel within the wheel, makes it difficult to justify, in particular when countries have different standards. With beef, for example, countries have different health standards. We place strong and onerous commitments on Irish farmers to ensure traceability and the health of livestock, but those standards are not the same in the Third World. We must have a level playing pitch. Therefore, if there is a concession — as there should be — on over-production, it should go directly to the people we want to assist and not to major multinationals.

That is an important point.

Mr. Brendan Archbold

Deputy Ned O'Keeffe referred to his travels abroad and the levels of poverty he witnessed. Some years ago, I was part of a British-Irish trade union delegation that went to Ecuador to look at working conditions in the banana plantations in the south of the country near Peru and around the city of Guayaqil. I will not go into all the gory details but, as the Deputy said, some of the sights we saw and discovered were unbelievable. Workers were sprayed from the air while working on crops and women gave birth to children with deformities as a result. As Deputy Howlin said, some of the footprints of the multinational companies were all over the place, for example, huge international fruit companies and supermarkets from our part of the world. These have used their negotiating strength to drive down prices and have driven poverty down the line. As a result, workers are driven out of these countries into our part of the world, something about which many people complain. I am sure it is unintentional but when we buy our bananas, we may create this terrible problem.

The bottom line of what I am trying to get at is in the European Trade Union Confederation, ETUC, document. The introduction refers to fundamental labour rates and core labour standards. Ecuador has excellent labour laws but nobody pays a blind bit of attention to them, neither the Government nor the plantation owners. The moving of core labour rights into the activities of the WTO is essential. These core rights are basic standards. In Ireland when we talk about industrial relations we talk about social partnership, wage increases, the working week, holidays, etc. In the developing world people talk about the right to exist or the right to exist free of being shot or harassed. The basic core of rights needs to be part of WTO activity. This reply does not quite answer the questions, but it is related to migrant workers and the area in general.

It paints an important background to what is happening.

My question is where are we with regard to embedding this in the negotiations. Senator Hanafin is correct that standards must be part of the liberalisation.

Mr. T. Joyce

Over the years the consistent approach of the European Union has been to try to have, as part of the ongoing development of the WTO, a concentration on trade and labour standards. We have been singularly unsuccessful in having that included in the negotiating round currently under way. In Doha we were unsuccessful in getting the rest of the WTO to agree to include labour standards as part of ——

Who resisted that?

Mr. T. Joyce

The developing countries as a bloc were unwilling to see this issue taken on as a major issue within the negotiations. They would, principally, regard it as an attempt on the part of the developed world to deny them some of their advantages in terms of trade. One can understand the reaction. The European Union continues to have improved labour standards as an objective, but it is still not possible to include that objective in negotiations.

Most of those countries have links with Third World countries and benefit from imports and exports. We are one of the few countries with no links or right to any ownership in those countries.

Mr. T. Joyce

Indeed, we have no colonial background.

I was not in Ecuador. However, I am well aware of what was done to the banana workers and that they were sprayed from the air.

Mr. T. Joyce

Perhaps I could make another point. We are not foolish enough to think that within the trade arena one can solve the sort of problems mentioned by the Deputy. However, we feel a strong multilateral trade regulatory system can contribute to meeting the concerns of the developing countries and to meeting the sort of issues prevalent. If one puts in place the proper and fair multilateral rules, one can have some effect on what is happening in Third World countries.

I now invite Mr. David Joyce to conclude this session.

Mr. D. Joyce

I will touch on one or two of the many strands. Mr. Tony Joyce is correct that the core labour standards issue has been a difficult area within the WTO. There has been great controversy regarding the issue of linking trade rights and privileges with respect for core labour standards. It has been a long-standing and not very successful campaign on behalf of trade unions, not only in Europe and the United States, but around the globe. We must move away from a situation where a country can gain competitive advantage in an open trading system by violating workers' fundamental rights. I am not talking about such things as a global minimum wage but about the right to be in a union, to bargain collectively, and to be free from child labour, forced labour and workplace discrimination. Unfortunately, the issue has become caught up in a protectionism debate, tending to degenerate into its dismissal as such. However, I would not describe it as protectionism but as being protective of workers' rights globally.

Deputy Howlin referred to the GATT. I am not a trade negotiator and would be loath to get into great detail. However, I refer members to section 3 of the ETUC paper on the subject, which mentions Article 11 of the GATT needing to be amended to ensure that governments are obliged to provide public services and are free to do so. In that manner, they would not be forced to give that up through liberalisation of services and trade.

The other question concerned migrant workers arriving here and being paid the minimum wage. Those are obviously very topical issues regarding unions considering whether they re-enter partnership negotiations. We do not believe that the Employment Permits Bill 2005 helps matters at all, since it refers to migrant workers being treated with respect but being paid at least the minimum wage. It does not refer to collective agreements or the going rate in construction, for example. As it stands, it is an open invitation to employers to pay migrants the minimum wage, which is something that we must address.

I thank the delegation, Mr. Tony Joyce, Mr. Frank Doheny, Mr. David Joyce and Mr. Brendan Archbold, for attending. We had a very worthwhile discussion, with some very enlightening views. They have certainly opened our eyes to the challenges that lie ahead for the country. In the near future, the committee must consider what the two experienced Ministers present have divulged to it. The matter concerns trade and the WTO.

The joint committee adjourned at 10.55 a.m. until 9.30 a.m. on Thursday, 24 November 2005.

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