WTO's new trade model is a lemon.

Byline: GUEST VIEWPOINT By Annalise Romoser For The Register-Guard

This week tens of thousands of people have traveled to Cancun, Mexico - the popular tourist resort beach town that attracts families and spring-breakers alike looking for a little fun and sun. These people (both Mexicans and foreigners), however, didn't come to sip margaritas, but to mobilize against the World Trade Organization, the most powerful trade body in the world.

Interestingly enough, the WTO's fifth round of trade negotiations is taking place in Mexico, a country whose experience under the North American Free Trade Agreement seriously calls into question the WTO's "free trade" development model.

Mexican and international civil society groups are holding a parallel "People's Forum" to highlight the shortcomings of the WTO and propose alternatives to the free trade model.

The WTO, which has its headquarters Geneva was created in 1995. It has 146 member countries (mostly poor, developing nations). It sets the rules for international trade and commerce of goods, products, services, intellectual property and investments.

Free trade proponents claim that by establishing trade laws that help to open economic markets, protect foreign investors' rights and reduce government regulation, the WTO helps to stimulate sagging economies, combat global poverty, protect the environment and curb world hunger. Critics maintain that WTO trade rules favor the interests of large corporations over those of the public good and supersede countries' ability to protect labor rights, the environment and public health.

Mexico serves as a prime test case of how free trade policies advocated by the U.S.-led bloc within the WTO, also called the "Quad" (the United States, Canada, the European Union and Japan), are detrimental to rural development, food security and national sovereignty.

Nearly 10 years after NAFTA took effect in 1994 between the United States, Canada and Mexico, Mexican agriculture is in deep crisis.

As tariffs are slashed, small farmers, who make up between 20 percent and 25 percent of Mexico's population, have seen cheap U.S. and Canadian corn, beans, wheat, sugar, meats, and dairy and other basic products inundate the domestic market, rendering them uncompetitive.

Meanwhile, small farmers on both sides of the border have received minimal government support as large multinational agribusinesses have benefited from generous subsidies. Consequently, Mexico's rural poverty has increased, unemployment is up and emigration is skyrocketing.

Rich countries represented in the Quad have refused to comply with their WTO commitments to lower agricultural tariffs and reduce domestic subsidies while at the same time demanding that developing countries such as Mexico eliminate trade barriers and cut support for local producers.

Another shortcoming of WTO-promoted free trade is NAFTA's Chapter 11, which Quad countries hope to replicate in their push for new WTO negotiations on foreign investment.

Chapter 11 grants foreign companies the right to sue governments when newly created domestic laws (such as environmental or labor laws) take away from potential profits - a serious affront to national sovereignty.

For instance, under NAFTA guidelines, Metalclad, a U.S.-based waste disposal company, was able to sue the San Luis Potosi state government because it would not allow the company to operate a toxic waste incinerator due to concerns over environmental and health hazards.

The San Luis Potosi government lost the ruling in a secret arbitration panel and was ordered to pay $16.5 million to Metalclad in compensation!

Chapter 11 is not only hurting Mexico, but our own communities as well.

In July of this year Glamis Gold Ltd., a Canadian mining company that was denied authorization by the California state government to begin operating an open pit gold mine because of noncompliance with environmental standards, filed notice of its intent to sue for compensation for its investment.

NAFTA has clearly demonstrated in Mexico and the United States that free trade benefits a relatively small number of corporations, while harming the environment and widening the gap between wealthy and poor citizens.

The WTO, guided by the Quad and its members' tremendous economic and political leverage, acts as the principal engine for institutionalizing this kind of development model around the world.

While tourists sip their tequilas this week on Cancun's beaches, the civil-society-organized "People's Forum" will offer economically viable alternatives to a free trade model that the WTO hopes to serve up to the planet as the new global cocktail.

Eugene native Annalise Romoser works in Colombia for Witness for Peace.