Trade statistics show that in the last 50 years international trade has been constantly growing. The creation of an International Trade Organization, which was to have addressed serious problems for developing countries such as the collapse of commodity prices, failed after the Second World War . Instead, 23 of the richest and most powerful countries formed an ad-hoc "gentlemen’s agreement" called the General Agreement on Tariffs and Trade (GATT). Following several important "trade rounds" of tariff reductions, GATT was integrated into the newly-formed World Trade Organization in 1995. Although WTO has 144 members world-wide and is the most important international forum for trade-related matters, it is not part of the United Nations system.
The WTO has enormous power. Trade in goods, which was the only sector covered by the GATT-1947, is now just one of the elements of WTO’s international trade agreements. Other sectors, namely trade in services and international protection of intellectual property, have now appeared. WTO also differs from GATT in that rules and a set of global standards are being developed to which every member state has to accommodate, notwithstanding differences in wealth or legal background. Binding rules of this kind do not exist to the same extent for public health regulators.
Why are we addressing the issue of trade and health in this issue of Update? Basically because we believe that the growth of international trade has significant consequences for public health. The relationship is not simple, nor is it unidirectional, but we try to highlight the main concerns arising from free trade agreements for public health.
"Free trade" as a goal
What do all WTO agreements have in common? Essentially, they all call for greater trade liberalisation or "free trade". In these agreements, free trade is taken to be an end in itself; that is to say, they assume that trade liberalisation alone will produce more well-being and more wealth and result in better living conditions for all. Unfortunately, this has not been the case. Half the world’s population continues to live on less than US$2 per day, according to the World Bank’s World Development Report 2003. Moreover, some WTO agreements have a negative impact on health. For example, the new standards set by the TRIPS agreement on intellectual property rights present a serious threat to access to essential medicines in developing countries, despite the efforts made by the WTO to find a solution to this issue.
At EPHA, we believe that trade should be seen as a "means to an end". In other words, international trade is good, and should be welcomed and supported, but only in so far as it leads to better health and quality of life for all. The new trade agreements of WTO have unfortunately produced some adverse effects not only for public health but also for labour standards and the environment, for example.
What is going wrong?
Some "goods" are under produced worldwide if left to the market mechanism alone. The WHO Commission for Macroeconomics and Health defines "global public goods" as products, services and activities that are: under supplied by the market, of broad international concern, and require international public action . The Commission’s examples include mechanisms to control the cross-border spread of communicable diseases, knowledge about how best to organise and finance health services to improve health outcomes among the poor, and research on conditions affecting the world’s poorest people. The proposition here is that investing in health as a global public good can play a role in poverty reduction and the promotion of social stability.
The extent to which the concept of global public goods is accepted varies. For example, the World Bank accepts that the benefits of investment in, for example, disease eradication programmes extend beyond the people treated (termed "positive externalities" by economists) but it limits its definition of public goods to the control of communicable diseases.
EPHA supports the call for a wide "global public good approach" because international measures are increasingly needed to address health problems. For example, more trade means more transportation leading to greater air pollution, and more trade means more buying and selling of commodities that are hazardous to health, such as tobacco, alcohol and fast food, often stimulated by global marketing campaigns.
Making trade work for health requires a number of measures to be taken both at national and international level, specifically at WTO. The time has come for the WTO to give more attention to the side effects of growing international trade, especially in relation to public health concerns. Trade in hazardous commodities, food standards and security, intellectual property, biotechnology and health-related services all fall into the competence of WTO; yet at the same time, they all have an impact on public health.
Working with WHO
The WTO Secretariat and the World Health Organization (WHO), which is responsible for public health within the UN system, recently published a joint study on "WTO agreements and public health". This is extraordinarily important as it shows a growth in public awareness of the critical relationship between trade and health. In the foreword, WHO and WTO Director-Generals Gro Harlem Brundtland and Mike Moore clearly state that "as the world becomes increasingly integrated, it becomes less and less possible for different policy areas to be handled independently of each other. The linkage between trade and health has been the focus of much debate". After analysing all the WTO agreements relevant to health, the paper concludes that: "minimising possible conflicts between trade and health, and maximising their mutual benefits, is an example of policy coherence".
This coherence in international policy making requires several approaches. First, we call for greater transparency and accountability in WTO policy making processes to ensure that public health concerns are carefully taken into account when formulating international trade laws. Second, every member state of the WTO needs to have the means to perfectly understand the implications of its role in the trade talks and to fully participate in negotiations. This requires a well-resourced and transparent "capacity building" process. Third, the WTO must work in co-operation with civil society and other international organisations, such as WHO, to ensure that "fair trade" rather than "free trade" is the objective. We call for WHO, United Nations Environment Programme (UNEP) and the International Labour Organization (ILO) to be given greater status at WTO, including at least "observer status" at WTO General Council .
Health vision for "free trade"
What do we mean by "fair trade"? The common understanding focuses on the relationship between producers and consumers, emphasising a fair and just reward for poor producers. Although this is important, we call for a broader definition in which trade is seen as a means to a better quality of health and a more sustainable future for all. Since public health is increasingly recognised in international health and development circles as an international public good, new trade policies must be guided by this way of thinking. Investment in global public health should increase, and development loans should never be tied to conditions of liberalisation that compromise public health as has been the case with IMF/World Bank "Structural Adjustment Programs".
If free trade means "as few rules as possible", fair trade means "the best rules possible" for reducing inequality, promoting public health and safeguarding the environment. We call for fairness in international trade, including a full impact assessment of the real benefits of the current "free trade" system. Even if fair trade sometimes acts as a restraint on international trade flows, it will always improve and protect the quality of life for all.
