International trade law being under the umbrella of the international law is the international body of legal framework that are concerned with the rules and customs under which different countries handle trade within themselves on an international level. International trade is concerned with different countries trading over their borders and it is not limited to regional trade and different countries from different regions have trading with each other. It is important to note that the concept of globalization has greatly boosted international trade and this can be attributed to the fact that different countries have adopted the technologies of transport and communication that have enhanced trade between themselves. This means that the countries can enjoy easy trade within themselves and this is because with mass transportation of goods and easy communication between different regions of the world, trade has been made ever easier between different countries in different regions of the world. However, with international trade there are some people in some regions that are being exploited by the concept of international trade. This can be attributed to the fact that the developed regions are taking advantage of the developing regions when conducting trade between the two regions. This paper will look into how this trend can be curbed if the international trade law will have a clause that is concerned with human rights.
International trade can be defined as the trade of goods, services and capital and this course is done transversely international borders and also over international territories. In most countries, international trade accounts for a very significant percentage of the Gross Domestic Product of the countries. It is important to note that international trade has been conducted for a very long time in the history of the world and this can be evidenced by such trade routes as the Amber Road and the Silk Road which had been set up to cater for international trade in different phases of history. However, in recent times it has been influenced greatly by the social and political outlook of the countries involved in the trade and there is also the fact that the social and political outlook of the countries have also been greatly shaped by international trade. It is also much influenced and in the same respect it has influenced highly the economics of the countries (3D Trade, 2003).
Industrialization, globalization, transportation, outsourcing and multinational corporations have played a very important part in the international trade and have helped boost the international trade systems of the world. International trade is very vital for the continuation of globalization a phenomena that has been deemed to be very important for the development of the international market as well as the development of the world economies entirely. The developed countries have been benefiting very much due to international trade. International trade is also very important because if it is rubbed out of the picture, the world economies would rely on the products and services that the country can produce and this can limit the development of the country’s economy (Gabrielle, 2002).
Principally, the international trade is very much similar to domestic trade and this can be attributed to the fact that the motivation, fundamentals and objectives of all parties involved in any trade is to benefit whether the trading is conducted across international borders or within the borders. However, there is a main distinction between the international trade and the domestic trade and is that the international trade is more expensive and problematical than the domestic trade. This can be attributed to the fact that international trade being conducted over political borders is subject to increments like tariffs and also the aspect of time cost which can be rooted to the fact that there are delays when closing the borders. There is also the complexity brought about by change of language, culture and the legal framework of the countries (Mariama, 2003).
In international trade, there is also the employment of different multiplicity of currencies and this has brought about the fact that various governments have been holding foreign currencies as reserves which are also held by the central banks of various sovereign states. The most sought after currency is the United States Dollar which has been pegged by many countries’ currencies around the world. In recent times, the Euro has been in high demand as well (Roger, 2000).
International trade is also different between domestic trade and this can be accrued to the fact that the factors of production which include such things as labour, capital and resources are more mobile within the borders than across the borders. This means that international trade is very much restricted to only deal with goods and services and very much limited to deal with capital, resources and labour. However, the trade in services and products can be a substitute for trading in capital and other factors of production (Gabrielle, 2002).
International trade law
The international trade law comprises all the customs and regulations which have been deemed apposite by international law to deal with the practice of trade handling amid different countries or also between companies from different countries.
Over the last two decades it has been noted to be one of the fastest growing fields of international economic law which is under the umbrella of the international law. However, it is important to note that the international trade law is different for the broader international economic law and this is because the international economic law is not only under the World Trade Organization law but also under other legal frameworks which govern the world’s monetary system as well as the currency regulation and also it is concerned with the international development (3D Trade, 2003).
The body of laws and regulations that govern the transnational trade in the modern world can be derived from the medieval laws that controlled commercial activities most notably the Lex Mercatoria and Lex Maritima which can be defined in English as the Law for the Merchants on Land and the Law for the Merchants on Sea respectively. It is important to note that the modern trade law was initiated after the Second World War and this is following the negotiation of the multilateral treaty which was enacted to deal with goods trade and was known as the General Agreement on Tarifs and Trade (GATT). To this effect, the international trade law is founded on the theories that seek to promote economic liberalism which was developed in Europe and strongly adopted and advocated for by the United States of America from the 18th Century onwards (Roger, 2000).
One of the most important features of the international trade law is the World Trade Organization which was established in the year 1995 and was established to regulate international trade. It is a formal organization of international stature. The World Trade Organization has been referred by many experts of international trade to be one of the most important developments as far as the history of international trade is concerned (Mariama, 2003).
The World Trade Organization has been very influential in international trade and the structure and the purpose of the organization is controlled by the Agreement Establishing the World Trade Organization which is also known as the Marrakech Agreement. It is important to note that the organization does not overly specify the rules that should be followed strictly but follows the rules that have been set by different treaties around the world which are also part of the Marrakech Agreement (Gabrielle, 2002).
Another important feature of the international trade is the General Agreement on Tariff and Trade which has been deemed to be the backbone of the international trade especially during the twentieth century. This agreement contains rules that can addresses practices which can be deemed to be unfair to other parties in the international trade and is concerned with such things as dumping and subsidies (Michael, 2009).
When there is a dispute in international trade the jurisdiction of the countries is the one that is responsible for solving the dispute and this is because there are no governing judges of international trade. The concerned country is the one that determines and this is done through the hearing the cases which are brought to them by the parties involved in the dispute. Various governments may choose to a party involved in the dispute and the citizens of the said government determines the jurisdictions and this is through the Forum Clause in a contract (3D Trade, 2003).
Another factor that is concerned with international trade disputes is the rate of exchange. When a currency fluctuates in both ascending and descending over some years, the lack of a Commerce Clause can be very harmful to the trade because one party can be enriched unfairly by the mere fact that one currency has fluctuated. This can be countered when the parties agree that a rate of exchange should be listed in the contract for the overall period of the contract and this provides for fluctuations in the market and is also subject to be reassessed (Gabrielle, 2002).
International trade and human rights
Human rights activists have not been concerned with how the international trade policy impacted in the human rights and this is until recently and this can also be said of the people who are concerned with the policies of international trade did not put into mind the aspect of the human rights. It is important to note however that there were few people who were concerned and tabled their concerns to the responsible authorities of how trade liberalization could negatively impact on the labour standards and also and very importantly the human rights. This trend would continue until the year 1998 when an alliance of environmental and labour groups made public the fact that the trade negotiators were mainly concerned about Multilateral Agreement on Investment (MAI) in a forum of the Organization for Economic Co-operation and Development (OECD) which sought to give privileges to investors of international stature which included mainly large corporations from the developed countries over the people and the public interest which seemed to disregard such issues as the health of the workers, safety of the workers and also the environmental issues at hand (OHCHR, 2002).
This led to the MAI negotiations being suspended in early 1998 and this was after the civil society went up in arms with the negotiators and supported by the public who were very much against the negotiations. Although the negotiation came to complete halt a few months later, some countries like Canada and European Union members had suggested that the WTO should be used as the appropriate body to govern the multilateral investment. This also acted as the pioneer awareness to the civil society that the international trade could jeopardize the human rights of the people all over the world (Michael, 2009).
Transparency and Participation: Human rights inconsistent
The World Trade Organization has been noted to be very undemocratic as well as opaque when making decisions which can be deemed to affect a wide scope of people. This lack of transparency and participation can not on themselves lead to the abuse of human rights or the direct outcomes of the abuse of human rights. However, it must be noted that lack of transparency and participation are not in line with the principles of human rights and these include the right of participation in the government’s decision making through democratic means. The Universal Declaration of Human Rights in Article 12 states that every single person has the right to be involved in the government that governs him (Caroline, 2002).
In regards to the World Trade Organization, transparency and participation has two categories namely the external and the internal categories. In respect to the external transparency and participation, it has been noted that the non-governmental organizations have absolutely no access to the organization’s work and this means that the secretariat of the organization does not have a department or a unit which can work in lieu with the non-governmental organizations to brief them of the organization’s intentions. It has been noted that the World Trade Organization is the only international and formal organization that does not have any relations with non-governmental organizations. Although there are some informal relationships with the NGOs, the relationships are very ad hoc and can be eliminated at the discretion of the trade organization (John, 2000).
Another issue is the public access to the trade organization documents and publishes. In the recent years, the public has had some access to these documents and publishes but it is important to note that the access is marred by the fact that many of the crucial documents have not been made public. It is also important for the organization to make some of their most important decision making meetings open to the public even the initial step would be on a basis of experimenting. It is also important for the organization to incorporate the civil society on their mechanisms of dispute settlement and evaluate how the civil society would help them in solving some of the disputes. It is important to note that the United States has been very vocal in the advocacy of the organization’s openness and the accessibility of the documents but these proposals have been subjected to unenthusiastic treatment. Many of the organization’s members have been suspicious of the non-governmental organizations while other members have been very reluctant to make the organization open to the public even after indications that the civil society can be very beneficial in the current positions of the international trade agreements and negotiations (Gabrielle, 2002).
There has been an argument by the members of the World Trade Organization that instead of subjecting the organization to public scrutiny, the governments involved should make arrangements of the domestic level to inform the citizens and also consult with the concerned non governmental organizations. This is an argument that has been supported by many non governmental organizations although the organizations point that this move should be to enable greater participation of the public not to protect the World Trade organization from public scrutiny (Dani, 2001).
To this effect, many civil society groups of the European continents have recently called the governments, the European Commission as well as the European Parliament to ensure that transparency level is heightened and also to ensure that there is accountability in the trade policy and formulation of trade policy process to the masses. It is also important to note that the World Trade Organization has opted to define the term non governmental organization to be inclusive of organizations that represent commercial interests of some commercial organizations. In the year 2003, the World Trade Organization accredited 961 non governmental organizations but it was to the alarm of the civil society that a third of the organizations that were accredited by the trade organization were corporate groups. Some of the organizations include the Aerospace Industries Association (AIA) and also Action Aid Kenya and Canada Beef Export Federation (CEBF) alongside the Centre for Economic and Social Rights (CESR). These organizations have an outlook of a genuine non governmental organization but they also represent some commercial entities (John, 2000).
Another cause of alarm is the year 2002 giving the rights of the pharmaceutical industry to have an equal footing as the rights of many countries. This was a time when the United States was a lone soldier in a bid to block a decision made by the World Trade Organization conference of ministers in the year 2001 in mandating Trade Related Intellectual Property and public health. This was a key aim to facilitate the people’s access to the medicines. It is claimed that in a bid to pave way for the situation, the Director General of the trade organization called ambassadors to a meeting and it is said that he pressurized third world countries to weaken the trade related intellectual property and public health in order to pave way for the United States and Pharmaceutical Research and also the association of American Manufactures of pharmacies known as the Pharmaceutical Manufactures of America (PhRMA) (3D Trade, 2003).
This is a clear indication that some powerful companies can be afforded more resources at the expense of the public interest and also non governmental bodies which are the public watchdogs to some of these matters (Fatoumata, 2003).
As far as the internal transparency is concerned the trade organization is also a culprit of denying some member governments the forum when making major decisions and this means that the members do not have an equal vote. This means that developing countries are facing hardships in participation of the decision making process of the trade organization and they are not treated as equals with the developed countries. This can be attributed to the fact that some of the developing countries lack the capacity and due to the economic hardships these countries are facing, some of them cannot even to have a representative in Geneva, the headquarters of the trade organization while others may invest in one delegate to cover all the issues at hand in Geneva which can be overwhelming (Gabrielle, 2002).
Extent to which the international trade law should consider human rights
With the onset of the international trade, there have been major developments and this has paved ways for countries to conduct trade with each other. The major elements that have played a major role in the advancement of the international trade can be said to globalization which has also played a major role in ensuring that many countries have the capability of using the technology at hand to enhance their trading activities. These technologies include such aspects as transport and communication. However, all the countries that are involved in this are not benefiting mutually and the major victims of this arrangement are the poor countries and the developing countries. It is plain to see that many developed countries are exploiting the developing countries and at the same time enriching themselves and ensuring that the developing are developing at minimal rates (Dani, 2001).
One of the reason why international trade law should encompass the human rights is the fact that many countries in the developed regions have started the concept of outsourcing and this has ensured that many developing countries are providing very cheap labour to the companies and corporations that have developed countries as their mother countries. Outsourcing has had a very negative on the citizens of the poor countries and this can be attributed to the fact that the labourers who are working for the corporations are subjected to very hard labour and very bad conditions while receiving very little pay. One of the companies that can be said to be a culprit is the sports gear producer, Nike which has been outsourcing in different countries in Asia. This means that while Nike is pushing for the labourers to produce high quality sports gear, they pay the labourers very little pay. There have been reports that child labour has been utilized by the Nike Corporation and this is one of the reasons why the international trade law should ensure that such things are eliminated from the picture (Caroline, 2002).
Another reason is that the environment of the weaker countries economically has been put into jeopardy by the corporations from the stronger countries economically. To this effect, the people of the weaker economy countries are subject to a degrading environment due to the pollution that the corporations subject their countries to. This means that the countries from the poor regions most notably Africa and Asia are being exploited by the corporations which degrade the environment and taking all the proceeds to their mother countries. To this effect, some countries have started experiencing environmental problems and this cannot be more unfair than when the country major export material is agricultural products. When the environment is degraded to such extents, there is the shortage of rains and hence the people cannot fully participate in their economic activity of agriculture, a factor that has contributed to the poor countries not being able to feed their citizens in a satisfactory manner (3D Trade, 2003).
Another reason why the international law should address the issue of human rights is that the companies and corporations that are engaging in this activity have been very unfair to the people who work for them. This is especially true for the companies that are amassing labour from the weaker economy countries. These people are expected to make large volumes of profits for the companies while they are being paid peanuts in the real sense. One of the factor that has brought this situation to light is that many of the rich corporations from the developed countries have been in recent times employing people from the developing countries and this has played a major role in ensuring that the people of these countries are subjected to very harsh working conditions and at the same time they are being paid very little money. This has brought about the issue of poverty where the workers are languishing in poverty while the owners of these companies are making billions in profits. This is a very unfair way of treating the most important asset that one has and that is the human resource. The international trade law should address the plight of the labourers especially those labourers working for big corporations and who are from the poorest regions of the world and who are living a life of poverty (Fatoumata, 2003).
International trade has also brought about an increase in the inequality levels. This can be categorized into two categories which include the richer countries are getting richer at the expense of the poor countries. The other category is that the poor people are getting poorer while the rich people are getting richer by the day and this is despite the fact that the rich people are getting richer at the expense of the poor people. What is alarming is that the percentage of the poor people who are living in absolute poverty is the largest with the poor people compromising of more than eighty percent of the world’s population while the rich people are less than twenty percent of the world’s population. The same applies for the rich countries which are significantly less than the poor countries. This can be attributed to the fact that the agreements which are made on the international trade are exploiting the poor entities and enriching the rich entities. The international trade law should ensure that this kind of behaviour is done away with and that the people have equal opportunities as well as countries have equal opportunities of developing (Caroline, 2002).
The environment is also one of the issues that some civil societies are concerned about. It is important to note that the corporations that have been in the activity of international trade do not care very much about the environment as far as their production is in line and that they are making money. This means that the corporations have done away with their interest in the environment and this has been replaced by their interest in making profits. In both the developed and developing countries, the levels of environmental degradation are very high and this means that the corporations have disregarded their role in the preservation of the environment. This is why many people are suffering because the ecological systems has been highly destroyed by the virtue that the industries are only concerned about making big profits and selling the products to the international market which is very profitable. The international trade law should ensure that these companies and corporations play an important role in ensuring that the environment is protected and that everybody’s right to a clean and productive ecology is protected even for the future generations (Dani, 2001).
The international trade is also one of the key elements that have been noticed to be the plight of the developing countries. This is because the developed countries have shied away from selling their industrial technology to the developing countries and this has ensured that while the developing countries are only capable of selling unfinished and unprocessed products, the developed countries have been able to be exporting manufactured goods. To add insult to injury, the developed countries are using the raw materials that they have imported from the third world countries to make the finished products. What is most alarming is that the finished products are sold at very high prices and this means that while the developed countries are making a lot of money on the finished products the developing countries are using a lot of money in buying the products while in the same respect the developing countries are making very little money on the raw materials they are selling. This can be seen as the root cause of the developing countries languishing in poverty while the developed countries are enjoying riches that can be rooted from the developing countries (3D Trade, 2003).
Some other issues arise from the products that are being sold in the international markets. Some of the most controversial products are the medicine related products which the pharmaceutical companies are selling in the international market. Many developing countries have been subjected to using the medicines that have been produced from the developed countries and this can be attributed to the fact that these countries do not have the technological know how of producing these drugs. However, what is most alarming is that the drugs that are being sold to the developing countries are sometimes affiliated with various side effects. It is important to note that the developed countries have mechanisms of protecting their citizens from these unscrupulous manufacturers while the third world countries have limited capabilities of fighting these manufacturers. It is to this effect that many people from the third world countries are suffering and hence the need for the international trade law to ensure that the plight of the people from the developing countries are protected from these kinds of products. Medicine is only one of the products because other things like electronics and clothing have had a negative impact on the developing countries’ people (Caroline, 2002).
The international trade law should ensure that all parties to the trade are put on a level platform of operating and this means that the parties should ensure that such things as participation and transparency is a very important aspect in their decision making. The richer countries also have the responsibility of ensuring that the developing countries are not exploited and rather they are afforded the right way of ensuring that they are also benefiting from the international trade. This means that the World Trade Organization has the responsibility of ensuring equity in all aspects of international trade and that all people who are involved in these kinds of activities are well taken care of.
- 3D Trade – Human Rights – Equitable Economy and Rights & Democracy (2003) Towards Development: Human Rights and the WTO Agenda, report of a panel discussion held during the WTO Ministerial Conference in Cancun, 2003.
- Caroline Dommen (2002) ‘Raising human rights concerns in the World Trade Organization – actors, processes and possible strategies,’ Human Rights Quarterly, Vol. 24, p. 1-50.
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- Fatoumata Jawara & Aileen Kwa (2003) Behind the Scenes at the WTO – the real world of international trade negotiations, London & New York: Zed Books.
- Gabrielle Marceau (2002) ‘WTO Dispute Settlement and Human Rights,’ European Journal of International Law, Vol. 13, No. 4.
- John Hilary (2000) The Wrong Model: GATS, trade liberalization and children’s right to health, London: Save the Children UK.
- Mariama Williams (2003) Gender Mainstreaming in the Multilateral Trading System – A handbook for policy-makers and other stakeholders, London: Commonwealth Secretariat.
- Michael Trebilcock & Robert Howse (1999) The Regulation of International Trade, 2nd ed., London and New York: Routledge.
- OHCHR (Office of the High Commissioner for Human Rights) (2002) Liberalization of trade in services and human rights – Report of the High Commissioner, E/CN.4/Sub.2/2002/9.
- Roger Normand (2000) Separate and Unequal: trade and human rights regimes, Background Paper for the Human Development Report, New York: UNDP International Trade Law and Human Rights PAGE 1