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HISMUN II ECOSOC CHAIR REPORT
Issue 1: “ The question of facilitating global free trade.”
Background Info:
History:
Global free trade is an idea that has been recently developed (during the industrialization period)
that encourages countries minimize restrictions on imports nor exports. Adam Smith and David
Ricardo opposed restraints on trade,which made them free trade’s progenitors. According to
them, each nation has a comparative advantage in producing something. For example, Thailand
has a comparative advantage in the production of rice,while the US has a comparative advantage
in the production of wheat. And when nations come and trade with each other, both parties will
be better off. Using this popular belief, many treaties have been formed over these past years.
NAFTA (North American Free Trade Agreement):
The concept behind NAFTA is the promotion of economic growth by easing the movement of
goods and services between the U.S, Mexico and Canada. NAFTA, which was established on
January 1, demand the removal of most tariffs and restrictions on trade between the three nations
and has a wide range of agreements on agricultural, textile, auto trade, telecommunications,
intellectual property, mobility of workers and environmental policies. The purpose of NAFTA is
outlined in article 102 of the NAFTA agreement:
●
Grant the signatories Most Favored Nation status.
● Eliminate barriers to trade and facilitate the cross-border movement of goods and
services.
● Promote conditions of fair competition.
● Increase investment opportunities.
● Provide protection and enforcement of intellectual property rights.
● Create procedures for the resolution of trade disputes.
● Establish a framework for further trilateral, regional, and multilateral cooperation to
expand the trade agreement's benefits. (Source: "FAQ," NAFTA Secretariat.)
WTO (World Trade Organization): WTO aims to create economic peace and stability in the
world through a multilateral system based on agreed member states (currently there 164
members) that have ratified the rules of the WTO in their individual countries as well.
Additionally, WTO’s purpose is to ensure that global trade commences smoothly, freely and
predictably. The WTO creates and incorporates laws for global trade among member nations
(domestically and internationally). The decisions are made by agreements among fellow member
states (majority vote). WTO is composed a General Council, a Goods Council, Services Council,
and an Intellectual Property Rights Council, which all report to the General Council.
TPP( Trans Pacific Pact ): Trans Pacific Pact started off from a P4 trade agreement between just
four nations - Brunei, Chile, New Zealand and Singapore - that came into effect in 2006. This
pact aimed to remove tariffs on most goods that were being traded between countries and to
cooperate on wider issues like employment practices, intellectual property and competition
policies. Now it has evolved into a pretty big trade agreement; it has 12 countries that have a
collective population of about 800 million - almost double that of the European Union's single
market. The 12 nations are already responsible for 40% of world trade. This pact was seen as a
remarkable achievement as it allowed countries to with very different standards, including
environmental protection, workers' rights and many more, to come together to form a single
market.
EU (European Union): is a politico-economic union of 28 member states that are located
primarily in Europe. The EU negotiates trade agreements to strengthen the economy and to
create jobs. This can be achieved in two ways, which is by enabling European businesses to
compete more effectively and export more to other nations within and outside the EU. EU also
gives better access to raw materials and vital components from around the world. This increase
in trade allows the economy to grow and also creates more jobs. Moreover, it gives consumers
wide choice of products at lower prices.The main goals of the EU are:
● removing or cutting customs duties (taxes) on goods that European companies
export
● scrapping any limits (quotas) on the amounts EU firms can export
● allowing EU businesses to provide services and bid for public contracts
● cutting red tape which makes it harder for EU firms to export, without cutting
corners on things like health and safety standards or environmental protection.
Defining Key Terms:
Fast-Track: means authorizing the President to sign trade deals with a single yes-or-no
Congressional vote after only limited debate. Supporting Fast-Track implies the speaker supports
free trade.
Fair Trade: means placing restrictions on imports based on environmental, labor, or other
concerns. Supporting Fair Trade implies the speaker is against free trade.
Free trade: is a policy followed by some international markets in which countries' governments
do not restrict imports from, or exports to, other countries.
Tariff: a tax or duty to be paid on a particular class of imports or exports.
Trade Deficits: is when a country imports more than how much it exports. Concern over trade
deficits implies supporting trade restrictions against nations that a specific nation imports from.
Trade Surplus: When a country exports more than what it imports.
Key Issues:
Controversies with NAFTA:
Critics claim that this treaty as a symbol of “insidious globalization, cordially invited into the
U.S. only to eat away at the domestic job market.” When the treaty was ratified, jobs moved
across the border to Mexico, where NAFTA would enable companies to take advantage of cheap
labor. This caused a huge unemployment problem in the US. NAFTA has been blamed for the
loss of American manufacturing jobs. Not only that, Mexico wants to discuss U.S.'s new,
restrictive migration policies and high corn subsidies for U.S. farmers, which hurt Mexican
farmers. And Canada wants to pursue new energy trade policies.
Controversies with WTO:
Critics say that the after-effects of WTO policies are undemocratic because of the lack of
transparency during negotiations. Opponents also argue that since the WTO functions as a global
authority on trade and reserves the right to review a country's domestic trade policies, national
sovereignty is compromised. For example, regulations that a country may wish to establish to
protect its industry, workers or environment could be considered barriers to the WTO's aim to
facilitate free trade. A country may have to sacrifice its own interests to avoid violating WTO
agreements. Thus, a country becomes limited in its choices.Moreover, intellectual property rights
has been a major concern over the past few years. For example, patented HIV/AIDS treatments
(that are costly) are not affordable by countries, such as those in South America and sub-Saharan
Africa. If they were to buy or manufacture these same drugs under an affordable generic label,
which would save thousands of lives. But if they do that then members of the WTO would be in
violation of intellectual property rights (and subject to possible trade sanctions.
Controversies with the TPP: The biggest criticism has been the secretive negotiations, in which
governments were said to be seeking to bring in sweeping changes without voters'
knowledge.Also if this treaty passed, it has the potential to outsource thousands of jobs to lower
wage countries and would cause a lot of problems.The TPP also threatens country’s sovereignty
because it will allow foreign corporations to sue every time they encounter a law that they don't
agree with.
Possible Solutions:
While creating jobs and boosting the economy is ultimately the job of each respective
state, there are several things that can be done to attain both of these goals effectively. Some
aforementioned attempts have been successful and should be continued. In addition to those
may include the following:
Considers that trade liberalisation must be accompanied by measures to ensure that free
trade is also fairer and benefits the common good, citizens and society. In particular,
international trade and investment must align with the concept of the Social Market Economy,
which emphasises free-market competition combined with social rights and the public interest.
This would alleviate the concerns of nation’s sovereignty (not interfering with countries’
domestic laws) and also protect jobs from being outsourced.
Secondly, nations should renegotiate the terms to include higher labor and environmental
standards. This would prevent problems that have erupted from NAFTA and TPP,which would
allow corporation to exploit the rights to outsource jobs to lower wage nations. This would stop
jobs from being destroyed and would allow creation of jobs in the nation. Moreover, having
stricter environmental standards would prevent corporations from exploiting natural resources in
lower wage nations and would allow a greener planet.
Issue 2: Alleviating the impact of HIV/AIDS on economic development.
Background Information:
What is HIV and Aids?
HIV is a virus that gradually attacks the immune system, which is our body’s natural defence
against illness. If a person becomes infected with HIV, they will find it harder to fight off
infections and diseases. The virus destroys a type of white blood cell called a T-helper cell and
makes copies of itself inside them.There are many different strains of HIV: HIV-1 and HIV-2.
HIV-1 the most common type of HIV found worldwide and HIV-2 is found mainly in Western
Africa, with some cases in India and Europe.
On the other hand, Aids is a syndrome caused by the HIV virus. It is when a person’s immune
system is too weak to fight off many infections, and develops when the HIV infection is very
advanced,This is the last stage of HIV infection where the body can no longer defend itself and
may develop various diseases, infections and if left untreated, death.
What is economic development?
Economic development is a broader concept than economic growth. Development reflects social
and economic progress and requires economic growth. Growth is a vital and necessary condition
for development,but it cannot completely guarantee development. Development is about creating
freedom for people ,which enables people to choose what they want. Obstacles to freedom
include poverty, lack of economic opportunities, corruption, poor governance, lack of education
and lack of health.
Definition of Key Terms:
Economic Development:Economic development is the process by which a nation improves the
economic, political, and social well-being of its people.
Economic growth:an increase in the amount of goods and services produced per head of the
population over a period of time.
Human Capital:the skills, knowledge, and experience possessed by an individual or population,
viewed in terms of their value or cost to an organization or country.
Key Issues:
HIV and AIDs gravely affects economic growth of a nation,which will directly affect
economic development too. Economic growth could slow down due to decreasing human capital
within a country. If proper prevention, nutrition, healthcare and medicine are unavailable then
large number of people would fall victims to AIDS. And people affected by HIV/AIDS are
unable to work,which lessen the available labor force and would also lead to smaller skilled
population. Since HIV/AIDS mostly affects adults, it will lead to smaller skilled population
(predominantly young people) that have little knowledge and experience, which would
eventually lead to reduced productivity.
Alongside loss in productivity, AIDS weakens the taxable population,which reduces the
resources available for public expenditure such as education,health services etc; this leads to
slower growth of economy.On the level of the household, AIDS results in both the loss of
income and increased spending on healthcare by the household. The income effects of this led to
spending reduction as well as a substitution effect away from education and towards healthcare.
This directly reduces human capital by not educating the young population.Economic theory
predicts that HIV/AIDS reduces labour supply and productivity, reduces exports, and increases
imports. With this effect in place, the countries with high mortality rates due to AIDS have a
deflationary gap in their economy and causes price levels to fall. And with reduced labor supply
causes wages of workers to rise and the quantity of workers employed to lessen; this reduces
firm’s incentive to hire more workers as it would rise their production costs.
Lastly, lower domestic productivity reduces exports, while imports of expensive
healthcare goods may increase. The decline in export earnings will be severe if strategic sectors
of the economy are affected, such as mining in South Africa. Consequently the balance of
payments (between export earnings and import expenditure) will come under pressure at the
same time that government budgets come under pressure. This could cause defaults on debt
repayments and require economic assistance from the international community.
Relevant Treaties:
•The United Nations Millennium Declaration of 8 September 2000;
•The Political Declaration and Further Actions and Initiatives to Implement the Commitments
made at the World Summit for Social Development of 1 July 2000;
•The Political Declaration and Further Action and Initiatives to Implement the Beijing
Declaration and Platform for Action of 10 June 2000;
•Key Actions for the Further Implementation of the Programme of Action of the International
Conference on Population and Development of 2 July 1999;
•The regional call for action to fight HIV/AIDS in Asia and the Pacific of 25 April 2001;
•The Caribbean Partnership Against HIV/AIDS, 14 February, 2001;
•The European Union Programme for Action: Accelerated Action on HIV/ AIDS, Malaria and
Tuberculosis in the Context of Poverty Reduction of 14 May 2001;
•The Baltic Sea Declaration on HIV/AIDS Prevention of 4 May 2000;
•The Central Asian Declaration on HIV/AIDS of 18 May 2001;
Possible Solution:
A possible solution to alleviate the impacts of HIV/AIDS in households is to evaluate the
economic and social impact of the HIV/AIDS epidemic and develop multisectoral strategies to:
address the impact at the individual, family, community and national levels; develop an
implementation of national poverty eradication strategies to address the impact of HIV/AIDS on
household income, livelihoods, and access to basic social services, with special focus on
individuals, families and communities severely affected by the epidemic; adjust and adapt
economic and social development policies, including social protection policies, to address the
impact of HIV/AIDS on economic growth, provision of essential economic services, labour
productivity, government revenues, and deficit-creating pressures on public resources. And also
to develop a national law to protect victims in the workplace the rights and dignity.