The world is going through a crisis; but, financial investments were never better than in the last two decades, as can be seen from official figures. According to the Bank for International Regulations, they have more than doubled since the beginning of the decade to reach a figure of over 20 000 billion dollars. These investments are mostly concentrated in the industrial countries and exceed the total of all their GDPs put together. However, this simple financial flow can have direct effects on the southern countries due to the volume that is at stake. The situation is similar in the case of direct foreign investments for producing goods and services. There is an increased flow of money and concentration of a small number of firms. One realises that, at the present juncture, there is no force that can limit the rate or the volume of these movements which benefited from unparalleled liberalisation measures since the 70s.

A new manifesto for global capitalism secretly negociated

Under these conditions, is it necessary to liberalise capital flows further and ensure total protection to investors for their investments, in the wider sense? Since May 1995, a Multilateral Agreement on Investments (MAI) having these objectives is being very discreetly negotiated at the OECD, the rich nations club. The signing of this agreement would raise fundamental issues concerning the sovereignty of nations and would bestow rights on investors which are almost equal or even greater than those of governments. With conditions of "non-discrimination" and "the clause for national wage", a signatory country of this agreement could no longer follow a policy which aims, for example, to protect national organisations or the rights of the salaried class. The principles of social justice, environment protection or rights of locals (in the case of mixed firms), all appear as simple pretexts to avoid opening of markets that is founded on dogmas. Moreover, an investor, whether real or even potential, could react to unequal wages by forcing a country into international arbitration where only the wage clause would be raised.

Citizens’ networks have developed, mainly in the northern countries to create awareness on this confidential agreement and its implications. Due to an effective mobilisation and the reticence faced, the signing of the agreement at OECD was delayed. Municipal councils in several major cities of the world adopted resolutions against MAI. They include San Francisco and Berkeley (USA), Toronto and Vancouver (Canada), Geneva (Switzerland), Tokyo (Japan) and many others, along with the European Parliament (resolution dated 11 March 1998).

Like Dracula, the MAI has difficulties in facing day-light, that is public opinion. In mid-October, France withdrew from OECD discussions. But, the agreement could be presented before the World Trade Organisation (WTO). The lobbies which are pushing for this agreement aim to have it adopted not only by the rich countries but also by developing countries. It is something like a blackmail: in order to receive foreign investments, these countries should sign an agreement whose terms are already written.

To the better informed observers, MAI appears as "the new manifesto for global capitalism" (L. Wallach) or "the Charter of multinationals" (T. Clarke). The importance of a treaty on investments cannot be denied. But, the claim that it stands above all international laws and agreements is contestable. An equitable treaty would make it possible to curtail speculation and define the rights and duties of investors.

That is how those who opposed MAI came out with alternative proposals. Tony Clarke from Polaris Institute (Canada) suggested "an alternative approach to develop a global investment treaty based on citizens’ rights and democratic control". Susan George developed in consultation with a French group a "Citizens’ Agreement on Investment and Wealth" based on a detailed report on the situation of investments at the world level. It was followed by proposals and recommendations. The text of this agreement is being circulated in Europe and Anglo-Saxon countries. Another Canadian, Joan Russow, leader of the green party, drafted a "Citizens’ Treaty for the commitment of States and Enterprises" based on the highest standards of the national law. The participation of citizens in developing a treaty seems to be increasingly necessary. They all agree on the necessity for open discussions and indicate that they should be based on the agreements adopted in UN, like the Universal Declaration of Human Rights, the Economic Rights and Duties Charter for UN Countries, the Right to work, the Rio de Janeiro agreement, etc.

A Case for Taxing the Flow of Finances

The regulation of financial markets will require more technical measures too. More and more voices are being raised in favour of taxing the flow of finances or levying the Tobin tax. Fixed at a rate of 0.1%, it can generate 30 billion dollars per year. This amount could become part of the social funds meant for poor classes or nations (cf. AATAC, p.12). Other measures could also be considered: taxes on profits and direct foreign investments, ecotaxes, compulsory deposits, etc. All these solutions suggest that the rights of peoples and their governments to frame their own economic, political and environment policies be recognised and therefore the neo-liberal fundamentalism of international financial institutions be rejected.

Wide and transparent discussions between civil societies, governments and economic actors are necessary to evolve a process which will bring down the financial bubble and put world economy in the service of mankind. The 50^th anniversary of the Universal Declaration of Human Rights is the best occasion to remind that the rights of people, children, minorities, indigenous populations, as also the right for work and environment are as fundamental, if not more, as those of investors. In this sense, all those who share these views can join the on-going discussions of citizens’ networks on the need for an investment treaty that is based on the fundamental rights of man and the rights and duties of States and Enterprises.

P.J.