Memorandum submitted by Traidcraft
Traidcraft welcomes the publication of this
White Paper because:
it is a significant and serious contribution
to the debate about the potential effects of Globalisation;
because it addresses those issues
specifically from the perspective of their impact upon the poor;
because it contains specific policy
commitments which, if carried through, will contribute significantly
to the goal of halving the number of those living in extreme poverty
Traidcraft made eight specific recommendations
to the team working on the White Paper.
In relation to the operation of International
Markets our recommendations were:
1. Increased pressure for greater accountability
and more equitable economic policies of multilateral trade fora
specifically the World Bank and WTO.
2. Increasing technical assistance and capacity
building of LDC's regulatory frameworks.
3. Increased research and support for "alternative"
more equitable approaches to trade.
We therefore welcome the statements in paragraphs
238-240 about the creation of a fairer multilateral trading system
and the policy commitments at the conclusion of Chapter 5.
We welcome the section entitled "Making
Markets work for the Poor", paragraphs 90-96. It is very
important to develop concrete mechanisms to realise these goals.
We are disappointed at the lack of specificity of policy proposals
in this section.
We are also disappointed that the paper contains
no clear commitment to support our third recommendation above
(although we note statements in paragraph 294-see below). The
encouragement of fair trade practices with an overtly development
focus, whilst small in their quantitative impact on poverty, can
be very significant in pioneering and developing best practice
solutions. Few social or scientific revolutions are achieved without
the encouragement of innovation.
In relation to Corporate Social Responsibility
our recommendations were:
4. Promote voluntary social reporting by UK companies.
5. Promote corporate governance models that emphasise
responsibility towards stakeholders.
6. Support mandatory social and environmental
reporting by UK companies
7. Encourage pension funds and other institutional
investors to promote "development-friendly" practices
by the companies in which they invest.
8. Promote international standardisation of environmental
and other risk reporting linked to stock exchange listing.
We welcome the section entitled "Promoting
Corporate Social Responsibility", paragraphs 197 ff.
We welcome the commitment to evaluate the potential
development impact of public procurement (paragraph 205) but are
otherwise disappointed that this section contains no new policy
commitment on behalf of the Government despite the obvious linkages
between best practice company behaviour in relation to stakeholders
and impact upon the poor.
In particular, if the general tenet of the White
Paperthat well regulated private sector trade provides
greatest opportunity for the pooris to be accepted, then
robust mechanisms for company reporting and disclosure seem to
be a sine qua non for keeping both governments and civil
society informed about the impact of such trade.
Paragraph 19 of the Paper says "Managed
wisely, the new wealth being created by globalisation creates
the opportunity to lift millions of the world's poorest people
out of their poverty. Managed badly it could lead to their further
marginalisation and impoverishment". One could add, "Unmanaged,
it will inevitably allow that new wealth to continue to
accrue to the `have's of society". Anyone who has played
the game of Monopoly will understand that principle.
We welcome the proposal for a new Development
Bill (paragraph 293) and the statements in the subsequent paragraph
about support for the promotion of development awareness and "support
for high-risk small scale activities".
We are puzzled about the intended role for the
Commonwealth Development Corporation. Paragraph 211 says "The
purpose of this partnership is to maximise the creation and long-term
growth of viable business in developing countries (especially
poor countries) . . .". Paragraph 223 says "To increase
their primary exports, developing countries also need help to
modernise their agriculture and make it more competitive".
As a government-owned business controlled by DFID, CDC should
be pioneering and leading the way for best business practice.
It is therefore surprising to learn that CDC is in the process
of divesting itself of all its agri-business activities in Africa
and cutting back on its field staff. How does this help to modernise
agriculture in Africa? Are we to understand from that DFID does
not consider that CDC's agri-business in Africa can be viable
in the long term?
It would be churlish not to acknowledge this
White Paper as a significant achievement for Ms Short and her
Department. The test will be how far its policy commitments can
be realised in practice, especially those which involve moving
forward the practices of the EU . . ..
. . . and the debate about links between economic
growth and inequality (paragraph 27 ff) will continue.