PACS IN THE

WSF 2007-NAIROBI

Author: Marcos Arruda Date: Rio de Janeiro , 30 Jan. 2007 (revised on Feb. 14, 2007)

I was invited to take part in WSF-2007 by the World Council of Churches (WCC). The WCC programme to promote Economic Justice asked me to speak on the subject of Wealth, Poverty and Ecology, from the standpoint of a Solidarity-based Economy. I was also asked to take part in a conference on Fair Trade for a Fair World. The WCC delegation had people from several continents, including a Brazilian Methodist lady pastor, Nancy Cardoso, from the National Coordination of the Land Pastoral Commission.

I - PROPOSALS FOR A WORLD SOLIDARITY-BASED ECONOMY WEEK 2008

The only Solidarity-based Economy activity I was to participate in was a meeting on Education and A solidarity-based economy, organised by Enda-Senegal?, with support from the Intercontinental Network for the Promotion of Solidarity Economy (RIPESS). But that was cancelled before the WSF began, so what was left to me was to attend a meeting of several networks on the evening of 22 Jan, with about another 40 people from different continents, to discuss the programme for the decentralised 2008 World Social Forum. Our networks agreed to support a WSF Global Mobilization Day on behalf of the dignity and the rights of the peoples. We also agreed to hold a decentralized Week on Food Security and Sovereignty and Responsible Consumption, both coinciding with the WEF- Davos 2008. We intend to give maximum visibility to these initiatives, their agents, products and services and their campaigns. This week aims at converting responsible consumption into a political act, and fostering the consolidation of responsible production, trade and finance. "Our shared vision is to go beyond capitalism towards a world in solidarity. We not only hope that another world is possible, and that another economy, society, cooperation and consumption is a vital necessity for the planet. Through a Solidarity-based Economy we demonstrate and live not one but thousands of direct and concrete alternative forms of construction of this world that is possible." ("Economic Alternatives", synthesis of the SE Networks present in Nairobi , 2007).

II - ECUMENISM

SEMINAR "WEALTH, POVERTY AND ECOLOGY" – This seminar was opened by Malawi 's Minister of Health. There were 10 presentations and about 80 participants; the session was interesting, but overlong. The transparencies I had brought on wealth, poverty and environment could not be shown for lack of time, but are available ( ). The main points of my talk were:

  1. The main revolution has to be in awareness. The understanding that we are interconnected with one another and with all forms of life demands that we make sustainability our ethics and spirituality, and solidarity our mode of relationship and inspiration for new socio-economic relations. It is thus indispensable to combine inner and outer change.
  2. This metamorphosis of awareness nurtures the sense of community, to help overcome the separation fostered by prevailing individualism. This sense makes it possible to practice holistic human development of the person, family, community, people and species. A solidarity-based economy is a community economy.
  3. Holistic development includes meeting material needs and freeing up the necessary time from work to develop our higher attributes and potential. Therefore, material wealth is only a means to acquiring higher riches, which are the most precious: free time for emancipated work, the immaterial senses of ethics, aesthetics, communication, sociability, solidarity and love. Ecovillages and Solidarity-based Collaboration Networks are two examples of initiatives in this direction.
  4. Emancipating human work, knowledge and creativity presupposes breaking with the system of exclusionary ownership prevalent in the world as the main trait of the system of world capital. Only by democratising the right and practice of owning the means to produce and reproduce life will it become possible to socialise productivity gains and distribution of the benefits of development.
  5. This requires that governments have the vision and the political will to introduce diverse concepts of wealth, innovative eco-social indicators and goals, and public policies to promote them in practice. Diversified concepts of wealth and innovative practices of eco-social indicators and goals exist in Cuba, Venezuela, Brazil, France, the Kingdom of Bhutan (Himalaya), England and China, among others.
  6. Institutions of global governance should be responsible for promoting incentives, legislation and regulation for economic agents, so that such practices become universal, and for creating an environment favourable to the practice of an economy of sharing and sociability, which would guarantee the sustainability of human life and respect for nature.

CONFERENCE "FAIR TRADE FOR A FAIR WORLD" – This was a large event attended by some 400 people. The panel included Jane Nalunga (Uganda), Walden Bello (Focus on the Global South, Philippines), Mohau Pheko (South Africa), Osvaldo Martinez (Cuba), Carlos Aguilar (Costa Rica), Oduor Ong'wen (Kenya), David Nalo (Kenya), Yash Tandon (Uganda), Marcos Arruda (Brazil). Most of the speakers centred their criticisms on free trade agreements and their disastrous effects on the economies of the South. Let me mention three speakers briefly. Walden criticised the FTAs and the WTO that sponsor neoliberal relations which are pernicious to the South; he spoke of optimism at the braking effect of the Mar del Plata meeting on FTAA negotiations, given the resistance from agro-exporting countries of the South. He also mentioned the popular protests in Thailand against the bilateral free trade agreement that was to be signed, making unacceptable concessions to the USA. The protests led to the resignation of the Thai government. Aguilar showed how today the Mexican people pay too high a price for a basic commodity, maize, because most of what is produced is exported, as determined by NAFTA, to be made into ethanol for bio-fuel in the USA. Martinez called free trade a caricature and a fallacy, showing that the main commercial stakeholders – the transnational corporations – control more than 2/3 of world trade by way of intra-firm exchanges. He mentioned the Latin American experience in solidarity-based integration (ALBA, Cuba, Venezuela , Bolivia) as innovative forms of integration opposed to the logic of "free trade" - the exchanges of oil ( Venezuela) for teachers and doctors ( Cuba), for example - and declared that ALBA is the way to supplant FTAs on the continent.

In my talk, I focussed primarily on the alternatives:

  1. Since ancient Greece, trade has been an activity directed to accumulating profits and material wealth. It may be more appropriate to talk about interchanges ( intercambios) to describe exchanges that seek mutual benefit and the satisfaction of real human needs. That is why, in relation to a solidarity-based economy, we talk about equitable exchanges of goods, services, knowledge and so on. Such interchanges may be intermediated by money, they may be barters (product for product) and may be done by sharing and free giving.
  2. It is important to understand interchange or fair trade as an organic part of the overall activity of socioeconomic development, directed to meeting needs and sharing well-being and the abundance of material and immaterial goods. In a solidarity-based economy, immaterial wealth – knowledge, communication, beauty, friendship, affection, sense of community – is the purpose of producing, interchanging and consuming the material goods necessary to sustain life. What gives value to the goods, services and knowledge to be interchanged is human work, knowledge and creativity. Trade is only fair if it serves human and eco-social development. There can only be an authentic system of free trade if the ownership of goods and productive resources is shared and not concentrated.
  3. At the level of cooperative production chains and solidarity-based markets, interchanges among cooperatives make it possible to use a price formation mechanism that includes neither exploitation nor surplus value. The baseline is production costs – rather than maximum profit – to which is applied a fair, negotiable profit margin; wherever possible the criterion used is total cost (which includes social and environmental costs), leading to new choices about what to produce and how; and leading to an interchange relationship that promotes mutual benefit, and from which seller, buyer and the eco-social environment all gain (examples of fair interchange from Peru, Ecuador, Brazil, Mexico-USA, Spain).
  4. In relation to international exchanges among societies, solidarity-based organisations in the North buy products from the South that have been produced to standards of social and environmental justice. That is not enough, however. For such exchanges to promote authentic development, they must encourage increased added value in products from the South, as well as increasing empowerment of producers to self-manage their development. One example of a network for fair interchanges between North and South is the Rural Coalition, which brings together rural and indigenous workers from Mexico and the United States . A few years ago they signed an alternative treaty for interchange on the Mexico-US border and collaborated in developing an electronic solidarity-based supermarket, which has now been operating regularly for several years.
  5. Exchanges among countries and regions of the world offer many eloquent examples of free trade. Picking up on Martinez' remarks, I highlighted the content of the ecological awareness that Cuba has brought to its relations with partners like Venezuela and Bolivia, stimulating the use of renewable energy sources, offering quality services in exchange for essential goods, such as urban gardening techniques for food production, orchard techniques to stimulate changes in eating habits (in Cuba, increased consumption of fruit and vegetables over recent years has been responsible for a 25% drop in heart disease rates!). The ALBA (Bolivarian Alternative for the Americas ) agreement among Cuba, Venezuela and Bolivia embodies the basic values of a regional integration based on cooperation, reciprocity, complementation, sharing of knowledge and know-how – in short, solidarity in seeking mutual benefit. Similar steps are being taken by these countries in the broader South American context. This is evidence that fair interchange and integration among peoples is possible, making it possible to achieve a world that is fair, egalitarian and fraternal!
III – JUBILEE SOUTH –

My time in Nairobi was devoted mostly to the activities of the Jubilee Network. I consider the Network's program on Debt and IFIs sound and highly successful, particularly as directed to thinking in greater depth and sharing those thoughts, and in developing closer relations among national and continental networks for concerted action.

1st Activity – 21 Jan. – Seminar "Illegitimacy of the Debt, Responsible/alternative financing; Conditionalities" .I took part in a round table with Vinod Raina (India) and Olivier Lorillu (Belgium) and about 50 participants. The points I addressed were:

    1. The problem is not indebtedness, but over-indebtedness, which leads to an inability to pay, leaving counties vulnerable to an endless spiral of depletion. Over-indebtedness in economies of the South is the responsibility of the local elites and their private, bilateral and multilateral creditors.
    2. Irresponsible over-indebtedness renders debt illegitimate and those responsible liable to punishment.
    3. Over-indebtedness has been used by loan-makers as a weapon to impose political control on loan-taker countries.
    4. Because of the history of impoverishment, decapitalisation and exclusion they have suffered, the peoples of the South are in fact not debtors, but creditors of a social, historical, political and environmental debt.
    5. The only effective way to deal with over-indebtedness is to mobilise and educate civil society to pressure governments for sovereign renegotiation. It is indispensable to gather accounting and legal evidence of the illegitimacy and even illegality of the debt. The Brazilian experience of citizens' audit and lobbying for an official audit is intended to instrument the government for sovereign renegotiation, which could include cancelling part or even all of the debt and demand reparation.

2 nd Activity – 22 Jan. – Workshop on the IMF Campaign (12 participants). We discussed the meaning and aims of the campaign. Controversy continues between those who want reforms and those who propose shutting the IMF down. For both, one immediate priority is to focus on combating conditionalities attached to IFI loans. We noted the need to strengthen social movements in order to force governments of the South to change their posture. Brazil is one example where a government calls itself popular and independent, but subjects itself shamefully to the IMF'sneoliberal ideology. We criticised early debt payments to the IMF by Brazil, Argentina and even Venezuela . Look at the contradiction: on the one hand, prepayment reduces the stock of debt but, on the other, leads to increased debt in order to cover the international reserve shortfall (e.g. Brazil), makes public finances more precarious and destabilises the IMF financially. So, if everyone loses, why go in for prepayments?

3 rd Activity – 23 Jan. - Seminar on "A different International Institutional Architecture: The Bank of the South" (65 participants) – I took part in the second round table, shared with Ghazi Hidouci (Algeria/France) and Olivier Lorillu (Belgium). The main points of my talk were:

    1. A brief introduction to the threats of global crisis – increasing social inequalities within countries, between countries and between hemispheres; financialisation; militarisation and the risk of nuclear war; environment (global warming, energy, water, deforestation, and destruction of biodiversity). Natural resources are abundant in Latin America and the Caribbean and the capitalist powers are greedy to feed the predatory, consumerist model of " corporatocracy" (=full power to the corporations).
    2. Self-development - "If you want to control your development, control your own finances" (J. M. Keynes) – requires reinforcing local economies, empowering the population to manage local and national development, regional integration based on reciprocity, authentic cooperation, solidarity and sustainability.
    3. The proposal for a Solidarity-based Bank of the South (see documents of the Caracas Symposium – www.oid-ido.org (external link)) represents a revolution in finances: it could replace the World Bank, inverting its logic of financing for "development" by introducing the solidarity-based approach (solidarity finance) into production and trade relations. It figures in the context of initiatives such as ALBA and other moves towards solidarity-based integration in South America, which transform relations among countries, because they incorporate the values mentioned above into the practice of interchanges.
    4. The larger aim is to construct an autonomous, sovereign instrument for financing another kind of development and an equitable system of interchanges, and to reduce drastically Southern countries' dependence on credit and financing from the North. One of the most important possibilities is that the Bank of the South will serve to attract the international reserves of countries of the South, today generally imprisoned in the IMF and in the banks of the Northern hemisphere. In this way, the reserves can be a capitalisation factor for the Bank of the South and, at the same time, come under sovereign management by the bank's member-countries!
    5. South America has served as the cradle for this initiative. It is also the source of a proposal for one or more complementary currencies to promote interchanges of goods, services and knowledge without the intermediation of currencies of the North. A sovereign monetary mechanism will soon be established between Brazil and Argentina . Also planned is introduction of a South American Parliament, which will reinforce democracy-building on the continent.
    6. However, the political and civilisational challenges are enormous, particularly due to the diversity of types of government in South America today. The solution to the technical problems depends necessarily on the political question. The precondition for headway on these initiatives towards democratic union among the continent's peoples is that those peoples participate actively in this process. Solidarity-based economy networks and other civil society movements are important actors in this mobilisation.

4th Activity – 23 Jan. - Seminar on "Strategies for debt cancellation, repudiation and reparation: audits, parliamentary strategies and others" (80 participants) – On the first panel, the colleague from Jubilee-USA mentioned a number of emblematic actions planned for 2007, particularly another 40-day fast by Rev. David Duncan for cancellation of the debt of the poorest countries. Carolyn recalled the blackmail and other forms of corruption practised by large corporations to secure contracts with Kenya and other countries of Sub-Saharan? Africa. Eric showed how the World Bank transferred colonial debt to the independent countries – an odious debt that should never have been charged. On the contrary, it should be repudiated and be the subject of reparations. Victor Zunzi, of Jubilee and CADTM (D. R. of Congo), said that the debt is suffocating the Congo, killing children and reducing a country of natural wealth to the most abject poverty. An audit is being prepared. What is most absurd is that the banks of the North have still not returned to the Congo the US$ 8 billion transferred illegally and immorally by Mobutu. The audit intends to review the projects and contracts with a view to repudiating the odious debt and demanding reparation. A Haitian colleague spoke of the historical, social and environmental debt that oppresses Haiti. Ivonne Yanez , an Ecuadorian working with Oil Watch International, went into the subject of historical debt in detail, focussing on ecological debt, and showed that these are strong arguments for cancelling financial debts and inverting power relations.

I took part in the second panel with Victor Zunzi (Congo ), Phillip (Germany ) and Dinky (Philippines). Victor explained that the audit is included in the new Constitution and that a document has been submitted to parliament, substantiating how disastrous debt has been and requesting an audit with civil society oversight. Phillip reported on mobilisation for the G8 meeting in Germa in June 2007. The agenda for that meeting consigns debt to the shadows, but the social movement will pressure for it to be brought out into the light of the debates. Dinky explained how the Philippines' debt has contributed to draining the country financially and subordinating its political leaders. Audit is also on the agenda of the social movements there. The main points of my talk were:

    1. In all indebted countries, whether very poor or "emerging", debt audit is indispensable as an accounting and political tool for renegotiation and for pressuring for cancellation of illegitimate and illegal debt, and to demand reparation.
    2. More work is needed on the concept of comprehensive audit, to include not just public financial debt, but also historical, social, political and ecological debt.
    3. On the ecological debt, I used the example that Ivonne gave of Texaco's polluting the rivers and soils of part of the Ecuadorian Amazon forest; that debt is estimated at more than US$700 million. Another example is a hydroelectric dam and reservoir built to generate expensive water, electric power and irrigation, particularly for the wealthy. It was built by a Spanish-based transnational, Fenosa, and is managed by US-based Bechtel.
    4. Only the combination of grassroots education and mobilisation with alternative economic initiatives based on cooperation and on solidarity finances can force audits and usher in a stage of emancipation in the history of the peoples of the South.

5th Activity – 24 Jan. - Seminar on Strategies "Where should the Campaign on IFIs head to in 2007" (40 participants) – The seminar was dynamic and included working groups. Everyone was invited to share the Campaign action plans in their countries. My points included:

  1. The power players on which our networks' actions impact include the World Bank, the IMF, the IDB, the BNDES (Brazil's national development bank) and some other multilateral banks or agencies operating on the continent, public opinion and the respective governments. The social stakeholders are networks that focus on and monitor the IFIs, such as RBIFI (Brazil Network on the IFIs), Rebrip (Brazilian Network for the integration of the peoples), Jubilee Brazil and Jubilee Americas.
  2. Jubilee Americas adopted a triple strategy that interrelates debt, trade and militarisation.
    • On debt, we focus on the campaign for official and/or citizens audit, and on critical study of (and action to influence) the relationship between financial debt and the historical, social, political and ecological debts.
    • On trade, in addition to the struggle against the FTAs and the WTO-Doha, we regard the weakening and postponement of FTAA negotiations as a victory, if only partial, but we consider it probable that the USA's weaving of bilateral FTAs in Latin America and the Caribbean (LAC) is designed to prepare the way for a new, and perhaps more virulent, negotiating offensive on the FTAA. We also focus on the critical study of the Initiative for the Integration of Regional Infrastructure in South America (IIRSA), the plan for mega-projects which, combined with the Puebla-Panama? Plan, would create the infrastructure base for operationalising the FTAA at the expense of astronomical indebtedness of the continent's countries, together with the social and cultural disaggregation of the populations affected by the construction work, and even greater environmental destruction. In Brazil in particular, the movements that make up the National People's Assembly ( Assembléia Popular Nacional) approved holding a grassroots plebiscite in September 2007 to annul the auction that privatised the Vale do Rio Doce Company (CVRD) in 1997, thus surrendering a large part of Brazil's mineral wealth to transnational groups. On the upside of the agenda, we are working for ALBA and for a South American union for continent-wide sovereign, sustainable, endogenous development in solidarity.

The points in the summary of decisions (which will be circulated later) on strategies are:

  1. Economic and political conditionalities connected with external loans.
  2. Governance of IFIs – "shrink or drown" campaign, "campaign for the end of government financing for the World Bank".
  3. Comparative studies of the crimes of IFIs and corporations.
  4. Work on national and international financial regulations.

6th Activity – Joint Strategy Seminar – Jubilee South and the Campaign on IFIs (about 200 participants) to discuss and approve the Declaration on Debt – We held a session to announce the agenda of actions on debt and the IFIs. We discussed and approved the Declaration on Debt, now published in two languages and shortly to be available in Spanish and Portuguese (see the website www.jubileubrasil.org.br (external link)). Discussion of the Declaration was marked by skilful, competent moderation of Liddy Nicpil and by the spirit of solidarity with which we discussed each idea, each paragraph, each new proposal, until we arrived at the consensual text you will read.