MAI


by Mary Steinmaus (Columbia, 68-71)
In April, 1995, twenty-nine of the wealthiest countries of the world,
all members of the Organization for Economic Cooperation and
Development (OECD), began negotiating a treatythe MAI or Multilateral
Agreement on Investment. This would be the first attempt ever to create
an extensive multilateral pact obliging countries to treat foreign
investors in the same way they treat their own.
The original deadline for completion of the treaty was May 1997, but a
one-year extension was granted. As the April 1998 date approached, news
of this treaty was leaked to NGOs and interested organizations and
individuals. What occurred then was an example of the power of the
wider community to affect the direction of public policy and to stop
the bulldozer-like force of transnational corporations to determine our
economic future.
What is the MAI?
Sometimes called the corporate rule treaty, the MAI would grant
investors unprecedented rights over governments, affecting the
democratic balance of power and disabling governments regulatory
authority at all levels. The MAI does not impose rules on corporations,
but rather on governments. Simply stated, these rules would require
local, state, and national governments to:
1) treat foreign corporations the same as or better than local
companies by conferring legal standing equal to that of nation-states.
(i.e., transnational corporations will be able to sue governments
directly and claim monetary compensation for damages.)
2) pay foreign investors compensation for environmental and other laws
that have the effect of taking investors assets.
3) defend lawsuits from foreign corporations in special international
courts away from public scrutiny.
A countrys signature on this document locks in the agreement for at
least 20 years.
The Debate For and Against
Proponents of the MAI (mostly business groups) say the agreement will
provide needed protections for the U.S. and other international 
investors against discrimination and expropriation.  It will also open
new markets to U.S. investors on favorable terms and help businesses,
consumers, and workers by improving the efficiency of the global economy.
Opponents say corporate privileges will be enshrined as corporate
rights and ring the death knell of existing international environmental
laws. Further, passage of the MAI would have devastating effects on
society, national sovereignty, and environment and consumer interests.
Most troublesome, opponents say, is that the document was prepared
under almost total secrecy. Industry representatives were involved in
preparatory work three years before negotiations started, whereas the
World Wildlife Fund was not aware of the MAI process until a year after
its initiation.  The full text was not made available until February of
1997, and then it was leaked. And there still are no mechanisms for
regular distribution of text under discussion. Individ-ual country
positions are not identified in consolidated texts; few people outside
When Corporations Rule
outside government and international business circles are aware.
There is substantial concern from environmental, labor, consumer and
womens organizations. Effects on the poorest countries are likely to be
devastating. Transnational corporations are already more powerful than
many nation states.
The Reaction
When news of the impending treaty leaked to the public, groups around
the world mobilized protests.  Here are a few examples:
1) Nongovernmental organizations (NGOs) mounted protests and organized
the International Week of Action Febru-ary 7-17, 1998.
2) In Canada, the Council of Cana-dians with 100,000 members campaigned
across the country. As a result, three provincial governments said they
would not recognize the MAI even if signed by the Canadian government.
3) In the U.S., Public Citizen (led by Ralph Nader) and Friends of the
Earth won support from many members of Congress skeptical about the
trade agreement. Citizen groups staged anti-MAI demonstrations on the
Capitol steps where members of Congress were given handcuffs
symbolizing the MAIs restrictions on law-making authority. NGOs also
organized national call-in days to Congress urging rejection of the MAI.
4) In the European Union, there were street protests, NGO critiques,
and inter-agency fights within governments on key issues. The word war
has been used to describe the situation in Finland and Sweden. There
was also quick movement in Italy, Denmark, the U.K. and the Netherlands
to denounce the treaty.
5) On February 12 in the Netherlands, activists occupied the entrance
of the office of OECD chairman Frans Enger-ing at The Hague. Forty
people from an anti-MAI action group, MAI Niet Gezien, went inside the
Ministry of Economic Affairs to protest and demand negotiations be
extended at least a year. They constructed a  factory of cardboard
boxes in the main hall of the building to indicate that investments
would be out of control under MAI.  They also called for a more open
and acceptable negotiation procedure with full information made
available and public participation.
6) On February 13 in London, several NGOs demonstrated in front of the
De-partment of Trade and Industry.  Other protests took place in
Sussex, Brighton and Oxford. Barry Coates chair of the World
Development Movement describ-ed the MAI as the biggest corporate
takeover in the history of the world. Un-scrupulous companies would be
free to act unethically and would actually be able to sue governments
who try to stop them.
7) A coalition of 565 environmental, development, labor, consumer,
church and womens organizations from 67 countries, called on the OECD
to suspend negotiations for the MAI. In their statement, they said, It
does not respect the rights of countries, including the need to
democratically control investment into their economies, particularly
developing countries and those in transition. The coalition called on
the OECD to:
l suspend MAI negotiations and extend the 1998 deadline to allow for
public input and participation
l increase the transparency of negotiations by releasing MAI texts and
organizing public meetings and hearings in member and nonmember
countries.
l Renegotiate terms of withdrawal to enable countries to more easily
and rapidly withdraw from MAI when they deem it in the interest of
their citizens. Developing countries which have not been a party to the
negotiations must not be pressured to join.