*{ Remarks by President Ernest Zedillo [http://www.iccwbo.org/home/commercial_practice/case_for_the_global_economy/full_texts/can_we_take_open_markets_for_granted.asp; note : accédé à partir de http://www.iccwbo.org/home/case_for_the_global_economy/globalization_road_out_of_poverty.asp]

World Economic Forum, Davos, 28 January 2000}

A peculiar alliance has recently come into life. Forces from the extreme left, the extreme right, environmentalist groups, trade unions of developed countries and some self-appointed representatives of civil society, are gathering around a common endeavor: to save the people of developing countries from*{...} development. 

Of course no member of this alliance would recognize that it is seeking to inflict intentional damage on anyone, least of all on the poor people of less advanced countries. Some of them would claim naively, others cynically, that they want exactly the opposite, and that for that reason they are against further, and even historic, trade and investment liberalization and in general and, frequently radically, against what is called today globalization.

They are, in spite of their differences in other respects, strongly tied together by their globaphobia. Ardently and sometimes in an altruistic tone, each puts forward its own motive for being globaphobic.

The alleged motives are very diverse but are expressed with a very revealing common denominator: the word protection.

Members of the globaphobia alliance speak, among other things, of protection of the rights of workers in developing countries, protection of the environment, protection of the sovereignty and identity of nations, protection of poor (and rich) countries from multinationals, protection of poor countries from market economy, and even protection of developed countries from drugs.

Every group in this alliance happens to believe that its own special interest - economic, political, social or otherwise - would be well served if trade and investment among nations were not further liberalized, and referably reversed.

Although globaphobic groups certainly dislike economic integration among developed countries, it seems that their true and irremovable target is trade and investment with developing countries. 

Of course, everybody is free to pursue any idea or interest, as long as it is done legally. But it is equally legitimate to inquire into the consequences of those protectionist pursuits for the development opportunities of developing countries and their masses of poor people.

Needless to say, not I, nor anybody else, would claim that access to free trade and investment is sufficient to achieve sustained development and overcome poverty. Much more is needed in terms of sound macroeconomic policies, domestic liberalization, permanently increasing investment in education, health and human capital in general -especially for the poorest- as well as the strengthening of democratic institutions including those that guarantee the rule of law.

However, what is now clear from the historical evidence of the last century, is that in every case where a poor nation has significantly overcome its poverty, this has been achieved while engaging in production for export markets and opening itself to the influx of foreign goods, investment and technology; that is by participating in globalization. 

The evidence of strong correlation and causality between openness and economic growth is now very well documented. It is perhaps for that reason that some groups, rather than relying on explicitly coarse -and already discredited- protectionist ideas to oppose free trade, are now resorting to seemingly more subtle pretexts for protectionism that are, however, equally fallacious and against the interests of poor people in developing countries.

Take the pretext of the rights of workers in developing countries. The fact that wages, social benefits and standards of living of workers in poorer countries are inferior to what is observed in developed countries, is used by opponents of free trade, now converted into fervent defenders of the working class of developing countries, to press for the global adoption of homogeneous core labor standards. They even want the WTO to enforce those standards with trade restrictions. 

Of course, it is a legitimate and achievable aspiration that, as early as possible, wages and working conditions tend to equalize across nations. But it must be recognized that such a goal cannot be achieved in the short-term and obviously not as the result of wishful thinking or by virtue of a decree, least of all by obstructing free trade and investment.

Both theory and practice show that open economies tend to converge, while closed economies do not. In the absence of absolute free labor mobility, trade is actually the most powerful instrument for making labor conditions converge across nations in the long-run. 

But trade mostly occurs now precisely because countries have different conditions, including labor ones. Now and in the foreseeable future, banning countries' differences is, and will be, equivalent to banning international trade and just as absurd. 

Therefore, we should be very suspicious of the altruism of those who want global homogeneous labor standards imposed through bureaucratic action as a precondition for additional trade liberalization. Probably they are not so much bothered by the poverty of workers in developing countries, but by the competition that trade certainly ignites. 

In trying to make their case stronger, proponents of global labor standards repeatedly point to the still low wages and other labor conditions of workers in the trade-oriented activities of developing countries. They seem decided to ignore the fact that frequently the alternative for those workers is extreme rural poverty or a marginal occupation in the urban informal sector of the economy, where hardly any labor right can be made effective.

They are also eagerly overlooking the fact that for most people in developing countries who work in trade-related activities, their jobs mean a significant improvement with respect to their previous occupations. Moreover, quite often these jobs are just a step towards better opportunities.

I have found this all throughout Mexico. Native people employed in the new apparel plants located in many of Yucatan's Maya towns, migrants from the south of Mexico working at huge maquiladora industries in the northern cities of Tijuana and Juarez, young engineers with good jobs at high-tech factories in Monterrey and Guadalajara, and many others have assured me that their new occupations - unthinkable in a closed economy - are much better than their prior ones, if any. Of course, they want and they deserve to do even better. I think they will, if we persevere in liberalizing our economy.

Of course, national governments as well as multilateral institutions such as the ILO, should tutor the rights of workers with fair and modern legislation, good agreements and better enforcement. I am fully committed to that. What I strongly oppose is the invocation of those rights to destroy trade opportunities, and therefore better employment opportunities, for poor workers in developing countries.

I am equally skeptical of the environmental pretexts against free trade. I am a strong advocate of protecting the environment. But I believe equally strongly that, on balance, economic integration tends to favor, not worsen the environment. Since trade favors economic growth, it brings about at least part of the necessary means to preserve and remedy the environment.

Increased incomes from trade-related economic growth also help to make people demand an improved environment. Furthermore, it is not uncommon that employment opportunities in export activities encourage people to give up highly polluting marginal occupations.

Again, the Mexican experience is a good case in point. As our economy opened we did not proceed to degrade environmental standards in order to attract new industries. Actually those standards and their enforcement have toughened significantly. Industry, owned either by nationals or by foreigners, is much cleaner today than it was when Mexico had a very closed economy.

During the NAFTA era, no case has been reported of a plant moving south of the border to avoid stricter environment standards. In contrast, many examples can be found of people shifting from highly polluting activities to environmentally-friendly ones, thanks to new opportunities opened by international trade. Take the still modest in scale but very encouraging case of peasants who have given up the highly destructive slash-and-burn agriculture to produce organic products for export markets. 

People who oppose trade liberalization using the environment as a pretext should recognize that the right answer in dealing with economic activities that produce pollution is not to forbid trade, but to promote and enforce stricter environment laws and make polluters pay.

They should also acknowledge that problems such as global warming, ozone depletion, ocean pollution or fisheries exhaustion, do require global solutions, based on multilateral agreements that provide the proper set of rules, incentives and sanctions. But these issues should not be addressed at the WTO. Another ad-hoc normative and dispute-settlement organization is needed for that purpose. 

Time prevents me from reviewing in detail other motives that have been recently raised against free trade. I would simply submit to you that some of those motives do refer to a legitimate cause or concern but, in my view, are wrongly placed in the context of the trade liberalization discussion. They deal with real life and with very challenging problems that, nevertheless, cannot be solved by interrupting trade. These problems demand solutions that truly address their root causes.

Other motives alleged by some globaphobics are mere rhetorical subterfuges for concealing sheer protectionism aimed mostly against developing countries.

I am fully convinced that notwithstanding what happened in Seattle -inside and outside the conference room- serious efforts to further liberalize trade and investment should not faint. Truly progressive minds sincerely committed to the advancement of the poor people in developing countries should, by virtue of persuasion, be converted into firm allies in this endeavor. 

In want to assure you that Mexico will continue working hard for an international order of, truly effective, free-trade opportunities for all.

Consequently, we will keep our most enthusiastic endorsement for a new round of comprehensive trade negotiations in a single undertaking, without excluding any area, directed towards the reduction of tariff and non-tariff barriers to trade in goods and services, as agreed in the Europe-Latin America summit celebrated in Rio de Janeiro last year.

In the meantime, we will continue actively seeking free trade agreements with other countries or regions. We will do it, as in the past, in full consistency with the WTO rules and based on a rigorous open regionalism, trade-creation never trade-diversion, approach.

It is in this spirit that we just finished negotiating a free trade agreement with the European Union, due to come into effect this very same year. 

When this occurs, Mexico will be the only country to have free trade agreements with the two largest markets in the world, Europe and North America, as well as with six Latin American countries.

I am convinced that it will be good for our trade partners, and undoubtedly in the benefit of our people, our environment and our national pride. 

*{Thank you very much.}