South Africa:
Workers on the receiving end of WTO policies

by Joyce Pekane

Let me start off my input by telling you the stories of workers from the 
clothing and textile sectors who had been retrenched as a result of trade -
- including increased imports and grey goods.

Karen, age 51, lives together with her husband and three sons in Elsie's 
River. For the last month, a friend of her son has been staying at the 
house as well.

Karen has a standard 7 education, and has worked most of her life. She was 
always proud of her ability to hold a job.

Today, the family must survive on the income of her husband and her eldest 
son — a total of R670 per week.

When Karen still worked as a machinist, her wages added R436 per week to 
that total.

Karen found the transition to joblessness quite difficult. "It was very 
hard. I have to depend on my husband's money now. I was independent all the 
years. My life changed dramatically. I went through depression."

She is still depressed today, and believes her husband is depressed as 
well. "Sometimes we argue a lot."

Karen finds it troublesome to accurately describe her distress: "When you 
haven't gone through it, you can't understand." Trying to clarify, she 
adds, "I was a very happy person. I would communicate with other people. 
I'm not the same person anymore. It really affects me."

With his income, Karen's husband pays rates, electricity, and other 
necessities. He does not share what is left over with the family.

Karen's eldest son gives most of his wages to her, approximately R200 each 
week. Karen spends all of it on food, adding "there's no money for me."

Previously, the family had spent R380 per week on food. There have been 
times in the past year when the family went hungry because of a lack of 
money for food. Karen must carefully budget her R200 to make sure there is 
at least bread and tea in the days before the next paycheque.

The story of Julius shows how his family has begun to break up as a result 
of his retrenchment. He told researchers that when he was retrenched from a 
textile firm in Hammersdale, and I quote: "I stopped being a real father to 
my children. I mean, being unable to put food on the table is the worst 
thing. I go out every day, but at the end of the day I come back with empty 
hands... Now my children live with relatives because I am unable to keep 
them."

These stories illustrate the impact of trade agreements. That impact is not 
just seen in cold figures on trade, investment flows or unemployment. It is 
seen in the lives of the working people we organise, in the rural areas 
that lose because our dairy industry is dying, in the streets of Salt River 
where clothing workers face unemployment.

In short, it is because of our experiences that we have to treat any trade 
deals with extreme caution. We simply cannot afford to give another push to 
the job-loss bloodbath we have experienced in the past ten years since we 
began cutting tariffs under the GATT and then the WTO.

These experiences have made us question the notion that free trade will 
lead inexorably to export led-growth and in turn to job creation. Our 
figures show that while exports have increased, there has been an equally 
dramatic rise in imports, which has been associated with job loss.

For example, in 1999 to 2002, exports rose by almost two per cent, imports 
rose by over three per cent — and employment dropped by over one per cent. 
Unemployment in South Africa is now well over 30 per cent, far higher than 
in any other middle-income country.

The President has said that all our policies must aim at job retention and 
creation. That was also the thrust of the recent Growth and Development 
Summit. In line with that, all positions taken at the WTO must ensure that 
jobs are preserved and that job creation is possible.

Prioritising jobs means we as South Africans must reflect on the way that 
we engage in the WTO as well as some of the positions we need to take 
regarding substantive issues.

The WTO faces an intense questioning of its legitimacy — many question its 
lack of democracy, the bullyboy tactics used in the negotiations, and the 
failure of the developed countries to meet existing commitments.

Why, after so many months has the consensus on TRIPS (WTO agreement on 
Trade Related Intellectual Property Rights — patents, etc) and Public 
Health not been implemented? Why have the deadlines on agriculture not been 
met?

These failures pose a problem for South Africa — where we had hoped to see 
progress we have not. Where we had thought we had made gains, we had not. 
How then should we engage at the present juncture, especially when the EU 
and USA are pushing for the acceptance of negotiations on the Singapore 
issues?

If we are to live up to our traditions, we need to ensure that the WTO 
begins to operate in a more democratic fashion. This means that we expect 
our government to pursue transparent and democratic functioning in the WTO, 
even in the face of resistance.

COSATU thinks that the following principles should guide negotiations at 
the WTO.

First, in light of the negative impact of past trade practices on 
employment and production, we will not accept any new agreement that 
reduces tariffs, or any negotiations on the "new" issues at the WTO.

We as South Africa have made huge tariff cuts and other concessions — it 
is time for our trading partners in the North to come to the table.

Second, by extension, we feel that the industrialised countries should 
improve the access of developing countries, including South Africa, without 
requiring further concessions on our part.

The North must end measures to support agricultural subsidies where they 
effectively prevent exports from or undermine production in the South. We 
cannot afford to lose another industry like dairy to subsidised imports.

Third, TRIPS must ensure that African countries have access to affordable 
medication as and when needed. That means that developing countries must be 
allowed to produce, import and export generic medication when and as they 
see fit.

Certainly we cannot continue to watch AIDS kill our people young when 
medicines exist to save their lives.

In this context, we welcome our government's commitment to rolling out 
anti-retrovirals in the coming months. But we also cannot let governments 
from the North condemn our people to die from other causes, just because 
they want to increase the profits of their companies.

Fourth, Basic services — that is, services that the state must supply to 
bring about development — must be ring-fenced from GATS (WTO's General 
Agreement on Trade in Services). That includes at least health, education, 
electricity, water and welfare services. In developing countries like South 
Africa, where mass poverty is the rule, the concept of basic services 
necessarily extends beyond the norm in wealthier economies.

Fifth, South Africa must urgently begin to take advantage of safeguard 
tariffs, as provided under WTO agreements.

Sixth, we should explore ways to increase flexibility for developing 
countries in reversing commitments that turn out to be mistakes, under the 
agreement to ensure special and differentiated treatment.

Finally, we as South Africa are a symbol of democracy throughout the world. 
We must maintain that reputation by supporting the fight for more 
transparency and democratic decision-making at the WTO.

It is a betrayal of our basic principles as a country to leave such 
critical policies to backroom deals. That approach only strengthens the 
power of conservative elements in the North.

In this vein, we also think it is important to reflect on how this type of 
consultation feeds into our positions at the WTO as a country. We have 
agreed that government's positions will be taken back to NEDLAC for further 
engagement following this meeting. (NEDLAC is the National Economic 
Development and Labour Council — a forum for discussions between organised 
labour, government, business and community.)

We are sure that our inputs will be taken into account systematically. We 
therefore hope that the Department will, at the end of the meeting, give 
some feedback on which of our points will be included. Where government 
feels it cannot take our ideas on board, we expect to be given the reasons.

* * *

Speech by COSATU Deputy President, Joyce Pekane, at the National 
Consultative Conference on the World Trade Organisation, 19-20 August 2003, 
South Africa.