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Trade

Beto Javier, 36, sells potatoes in the Vino Cancho farmers' market in Cusco, Peru. Potatoes are one of the staple crops of highland Peru. Photo: Percy Ramírez / Oxfam America

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Trade generates incredible wealth and connects people everywhere, yet millions of people in poor countries are not benefitting, and many are actually worse off, because trade rules are rigged against them. Oxfam is committed to making trade fair.

World trade rules have been developed to serve narrow commercial interests. As a result, rich countries and powerful corporations have captured a disproportionate share of the benefits of trade. The US has prioritized expanding its own exports and ensuring a favorable environment abroad for US investors. But focusing exclusively on these goals can hobble US foreign policy’s broader objectives, including helping developing countries fight poverty, inequality, and disease. For example, expanding monopoly protection of drug company patents can prevent poor people in developing countries from gaining access to affordable medicines. And demanding policies that maximize overseas opportunities for US corporations can confiscate policy tools developing country governments use to protect their own citizens and manage their economies. Typically, the US and other wealthy countries try to open other markets to their exports while protecting their own sensitive products. This “mercantilist” approach can limit developing countries’ ability to boost their exports and create better livelihoods for their people. And current rules aimed at facilitating capital flows in search of profit maximization have concentrated wealth and the benefits of trade among the economic elite both here and abroad.

Oxfam believes trade should not be an end in and of itself. We argue that trade rules should be judged by their impact on poverty reduction, respect for human rights, and environmental sustainability. Trade policy should deliver more benefits to working people and should spread economic opportunity as broadly as possible in the US and the developing world. It should not deepen poverty, inequality, and exclusion. Through our research, campaigns, and advocacy, Oxfam strives to make trade rules fair so that workers, developing countries, and poor people are able to reap the benefits from trade.


Activities

Oxfam focuses on US trade policy and the US role in multilateral negotiations, bilateral and regional free trade agreements, and unilateral trade preference programs.

We advocate strengthening unilateral trade preferences, and we have urged the US to eliminate tariffs for all goods from the world’s poorest countries to enable these countries to boost exports and create jobs.

Oxfam believes that investing in and strengthening the multilateral, rules-based trading system is the best way to ensure that all countries, particularly those with substantial populations living in poverty, can benefit from trade. We reject the doctrine of promoting “competition for liberalization” that has been at the core of US trade policy. We encourage both the US and the European Union (EU) to stop pursuing bilateral and regional free trade agreements (FTAs) whose rules exceed those that could be agreed at the World Trade Organization (WTO), and to instead do what is necessary to reach a pro-development deal that will bring the WTO Doha Development Round to a positive conclusion.

The FTAs pursued by the US require accelerated market openings, with no effective safeguards and little regard to a country’s level of development or economic vulnerability, and include provisions that far exceed what could be negotiated at the multilateral level. Well beyond addressing cross-border trade, these FTAs impose far-reaching and binding rules that dismantle national policies designed to promote development. These “behind-the-border” measures—in areas such as intellectual property (IP), investment, and services regulation—can undermine effective economic governance and poverty reduction efforts, transferring power from developing country governments and citizens to largely unaccountable multinational firms.

Today, Oxfam’s primary focus is on the Trans-Pacific Partnership (TPP) currently under negotiation by the US and 11 other developed and developing countries, encompassing nearly 40 percent of the world economy. US negotiators, supported by vigorous corporate lobbies, are seeking to lock in a wide range of restrictions on the rights of government to regulate in the public interest and in the interests of people who are marginalized, vulnerable, and living in poverty.


Goals & priorities

We are currently urging the US government and its trade negotiators to:

  • Include sustainable economic development as a core negotiating objective in all trade agreements.
  • Exclude from trade agreements any further expansion of intellectual property (IP) protections for pharmaceuticals beyond the rules established by the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement. The 1994 TRIPS Agreement created a common global minimum standard of IP rules that all WTO members adhere to. It introduced a minimum 20-year patent term, representing the single greatest expansion of IP protection in history. TRIPS also includes a range of public health safeguards and flexibilities, which were reinforced by the 2001 Doha Declaration on the TRIPS Agreement and Public Health. Yet US FTAs, starting with Jordan in late 2001, have required countries to introduce new, stricter IP protections that far exceed the minimum obligations under TRIPS and prevent the use of public health safeguards. These provisions block or delay the onset of generic competition, keeping medicine prices high. It is for these reasons that Oxfam seeks to prevent US negotiators from placing or allowing restrictions on public health safeguards in FTAs.
  • Guarantee that investment rules do not grant greater rights to foreign investors than to domestic investors, undermine national judicial systems, or curtail the ability of governments to make effective policy decisions to protect the public interest and promote national development.
  • Make all trade negotiations transparent and open to the public, and ensure a more balanced representation by public interest groups on the Office of the US Trade Representative (USTR) advisory boards as a counterweight to special business interests,

Achievements so far

Oxfam has raised awareness and galvanized opposition to free trade agreements that deepen poverty and inequality and threaten public health. We brought many small-scale farmers and public health advocates from Central America, Peru, and Colombia to Washington to speak truth to power when US FTAs were under negotiation with their countries and were being debated in the US Congress. Although the FTAs were ultimately all passed, we elevated the voices of civil society in developing countries to educate policymakers and the public about the adverse effects of these FTAs on development in their countries. We helped create space for members of civil society to advocate with their own governments to resist US pressure and address the adverse effects of the FTAs on the most vulnerable. Oxfam’s research and advocacy, along with growing civil society activism and political opposition in Latin America, helped blunt a more ambitious effort negotiated through a wider agreement known as the Free Trade Area of the Americas (FTAA).

During negotiations and debate over the US-Colombia FTA, Oxfam conducted research in Colombia to assess the potential effect of the FTA’s agricultural provisions on Colombia’s small-scale farmers, which found that a significant number of small farm households would see substantial drops in their income as a result of the FTA. Follow-on research sought to understand what would be needed to enable those farmers to overcome obstacles and take advantage of trade opportunities, and then we put forward policy options. We hosted Colombia farmers and researchers to advocate these findings with policymakers in Washington. And one year after the US-Colombia FTA was put into effect, we carried out research on how Colombian farmers fared. Our research identified some worrying overall trends as well as specific agricultural products at risk of adverse impacts affecting small-scale producers in Colombia.

Oxfam has also conducted research to document how the IP provisions in FTAs negotiated over the past decade restrict generic competition. Our 2006 study of the Jordan FTA examined its impact on medicine prices five years after it went into effect. It analyzed the results of IP rules known as of “TRIPS-plus” rules—because they exceed TRIPS standards—and focused only on provisions on data exclusivity. These are onerous rules concerning data from clinical trials that can effectively block the registration of generic alternatives to brand-name medicines. Our study showed that 79 percent of all new medicines introduced in Jordan did not have generic equivalents solely because of data exclusivity. In some cases, the lack of a generic meant that prices for key medicines to treat heart disease or cancer, the two major causes of death and disability in the country, were anywhere from two to eight times more expensive than the generic version of the medicine available in neighboring Egypt. Overall medicine prices increased 20 percent in the country, and the government, facing higher medicine prices, had started to scale back other public health care spending.

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