(Ane Schjolden’s comments at seminar in Oslo 12.10.07)

Since I am the only NGO representative in the panel, I have to start with a comment to your rather provocative treatment of NGOs and their advocacy work. In your best case scenario, we are mal-informed, but your other hypothesis is that we’re infiltrated by Marxists, and you accuse NGOs of seeing “everything through the spectrum of rich countries oppressing poor countries”.

I would like to turn this into a challenge for you, to ask yourself critically what kind of glasses you are seeing everything through. As an economist, you have to reduce the world’s complexity into some limited measures that can fit into a model, and many times you forget to make the assumptions behind those models explicit. There are many limitations of current economic theory, among others trade theory, and in your book you don’t address these limitations, nor do you present alternative perspectives to mainstream neo-liberal theory. You seem very convinced in holding the truth, something I wouldn’t expect from a researcher.

With that said, I would like to focus on two main issues:
International economic structures and trade

1) International economic structures

In your book, you are in general very positive to economic reforms as advocated by the World Bank and the IMF, without going into detail on in which contexts or under which circumstances what types of reforms are needed, and without addressing what can be done to reduce the negative effects that have to result from painful reforms. In many cases on the ground, NGOs working with local communities, see that people are being marginalized as a result of economic liberalization and/or privatization. Exemplified either by losing their local market or having to pay for a service they previously received free from the state. As an economist, your theory prescribes that if people are forced out of business in something, they will shift into something else more productive. But what when there is nothing to shift into?

You also don’t address the democracy or power aspects of economic reforms. In many cases reforms are not undertaken after a democratic process in the country in question. This is why many NGOs are arguing for developing countries should be granted the policy space to decide their own development policy.

2) Trade

Glad to read that you are not a supporter of “big bang liberalization”

On the WTO you make useful distinction between a deal and a transfer, and we agree that the current round of negotiations is absolutely not a “Development round”, and you acknowledge that in the WTO as a marketplace for bargaining, the bottom billion countries have virtually no influence. 

Bottom billion: No markets of interest for the rich. Then why should they be forced to reduce their tariffs in the same way as China, India and Brazil?

They might not have a market now but what about the future markets that might develop?

Tariffs: You are against the use of tariffs for developing countries to protect their own markets, because you see it as a source for corruption.  But if a system malfunctions, is it a reason to remove the whole system, or to improve its functioning?

I would also like to hear your opinion on tariffs as an income source for government’s spending on social and education services.