[asia-apec 391] Re: NZ government slammed over OECD investment treaty

[Gatt Watchdog]

Path: corso!gattwd
From: gattwd at corso.ch.planet.gen.nz (Gatt Watchdog)
Newsgroups: misc.activism.progressive
Subject: NZ government slammed over OECD investment treaty
Message-ID: <ge7N6D2w165w at corso.ch.planet.gen.nz>
Date: Thu, 24 Apr 97 15:35:51 +1200
Reply-To: gattwd at corso.ch.planet.gen.nz (Gatt Watchdog)
Organization: PlaNet Gaia Otautahi

GATT Watchdog
PO Box 1905
Otautahi/Christchurch
Aotearoa/New Zealand
Email: gattwd at corso.ch.planet.gen.nz

CAFCA
PO Box 2258
Christchurch
Email: cafca at chch.planet.org.nz


MEDIA RELEASE

24/4/97
For Immediate Use

Government secrecy over OECD international investment treaty slammed.

Fair trade coalition GATT Watchdog and Campaign Against Foreign 
Control of Aotearoa (CAFCA) are urging the government to withdraw from 
further highly secretive negotiations on a Multilateral Agreement on 
Investment (MAI) which seeks to do away with barriers for foreign 
investors among the OECD (Organisation for Economic Co-operation and 
Development) nations.  The groups challenge the government to enter into 
genuine public consultation on this issue immediately. 

The MAI represents a radical new economic treaty to set new limits on 
how governments can regulate investment and would override national 
legislation.  CAFCA and GATT Watchdog have obtained a copy of the 
leaked draft agreement.

In letters to the Prime Minister, International Trade Minister Lockwood 
Smith, Minister of Foreign Affairs and Trade Don McKinnon, Deputy 
Prime Minister and Treasurer Winston Peters, and Finance Minister Bill 
Birch, GATT Watchdog questions the mandate of the government to enter 
into such negotiations without any public debate and challenges the 
secrecy surrounding the proposed agreement.  It points out that the Clerk 
of the House of Representatives, David McGee described the way in which 
New Zealand has entered into international agreements such as the 
GATT (General Agreement on Tariffs and Trade) as "fundamentally 
undemocratic".  An October 1996 Department of Justice briefing paper to 
the Minister of Justice raised similar concerns.

"Most New Zealanders are oblivious of the fact that New Zealand officials 
at the OECD are participating in such a far-reaching agreement.  The 
OECD has no mandate to be negotiating such a treaty in the first place.  
And what mandate do Ministry of Foreign Affairs and Trade or Treasury 
officials have to participate in this process in such a secretive manner?" 
says Aziz Choudry, GATT Watchdog spokesperson.

"The European Union, having failed thus far to get such an investment 
treaty created within the World Trade Organisation (WTO), and the USA 
are the main proponents of the MAI.  This is in essence a freedom charter 
for transnational corporations, giving them absolute rights without a 
shred of responsibility.  It goes far beyond the investment liberalisation 
measures contained in the GATT Uruguay Round.  It will strip away the 
powers of governments to regulate investment, and outlaw discrimination 
against foreign investors. It would facilitate even easier movement of 
assets from country to country, encouraging countries to compete in a race 
to the bottom in environmental, health and safety standards and labour 
costs to attract investors.  It would allow any corporation with a grievance 
against regulatory mechanisms the right to sue local or national 
governments before an international tribunal with a binding outcome.  
And it would have many more implications, limiting other rights of 
national governments to ensure that investment serves local economic and 
social needs.  If New Zealand signs this agreement it would remove any 
remaining protections over the economy in areas like fisheries and rural 
land ownership for example.  And how does the government square its 
Treaty of Waitangi obligations with its negotiations on the MAI?" he said.

"The OECD had hoped to get negotiations completed by May, but this 
deadline has now been moved back several months.  It is high time that 
the Government fronted up to the peoples of New Zealand rather than 
presenting Parliament with a fait accompli in a few months time as it has 
done in the past in relation to other international treaties it has entered 
into.  WTO Director General Renato Ruggiero has characterised the MAI 
negotiations as "writing the constitution of a single global economy..."  
Governments will be reduced to the status of mere filing clerks, ratifiers 
and rubber stamps in the service of transnational capital.  We urgently 
need genuine public debate about the contents of the draft investment 
agreement, New Zealand's position in these negotiations, and the 
implications for New Zealand and New Zealanders of the MAI.  Without 
this the government cannot claim to be democratic."
 
"The question of foreign investment was a major election issue last year.  
And rightly so.  The right of peoples to decide how, where and to what 
extent foreign investors may enter their economy is fundamental to any 
society which wants to chart its own course of development and hang on to 
its political and economic sovereignty.   That right is now under renewed 
threat with this OECD proposed agreement" concludes Mr Choudry. 

(Copy of letter to MPs is attached)

A copy of the draft MAI text can be viewed on the following website:  
http//www.citizen.org/gtw 
Copies are available from CAFCA, P O Box 2258, Christchurch cost $15 
for copying and postage

For further comment 
ph Aziz Choudry (GATT Watchdog) (03) 3662803 (w) 3484763 (h)
 or  Murray Horton (CAFCA) (03) 3663988




(Letter to Ministers)

23 April 1997

Dear Dr Smith,

We understand that Ministry of Foreign Affairs and Trade and Treasury 
officials are currently involved in negotiating an OECD multilateral 
investment agreement.  

We are deeply concerned that the government is taking part in such 
negotiations when it has not consulted with the public about either the 
contents of the draft agreement on investment nor the implications of such 
an agreement being concluded on New Zealand and New Zealanders.

Essentially we believe that the OECD proposal reads like a freedom 
charter for the transnational corporations which dominate the world 
economy.  The removal of a nation's right to determine how, where and to 
what extent foreign investments may be made severely compromises 
economic and political sovereignty.   

The Clerk of the House of Representatives, Mr David McGee raised 
concerns last year about the "fundamentally undemocratic" way in which 
New Zealand has entered into international agreements such as the 
GATT.  He points out that there "is little or no opportunity for public 
input while a treaty is under consideration" and that Parliamentary 
debate tends to be bypassed altogether in such cases.   Similarly, an 
October 1996 briefing paper to the Minister of Justice by the Justice 
Department suggests: 

"where treaties are likely to change our domestic law, presenting the 
House with a concluded draft treaty for acceptance or rejection may not be 
sufficient.  Where a treaty has the potential to affect the rights of New 
Zealand persons, parliamentary, and hence public, participation would be 
more effective if  the House provided guidance during the formative 
drafting stages".

We seriously question the mandate of the New Zealand government to 
enter into such negotiations, let alone bind itself to an agreement of this 
kind.   

We believe that it is outrageous for the New Zealand government to enter 
into such an agreement without there being public debate, and a public 
mandate to do so.  We call on the government to withdraw from further 
negotiations until genuine public consultation on this matter has taken 
place.

We would welcome your response as to the nature of New Zealand's 
position at the OECD negotiations on this agreement and an explanation 
as to the high level of secrecy which surrounds it. 

Yours sincerely, 



Aziz Choudry - GATT Watchdog


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