Don’t repeat the failures of the TPP in other agreements
**This article was originally published in Fairfax Media: read it here.**
Donald Trump didn’t kill the TPP. His opposition was only the final blow which came at the end of more than six years of criticism of the TPP in the US, Australia and other TPP countries by public health, environment, church, union and other community groups. Their criticism was based on human rights and environmental values which were the opposite of those expressed by Trump during his campaign. These critics were not against trade itself but against unfair trade deals. The TPP’s death should teach us some key lessons about future trade policy.
Firstly, the TPP was not mainly about traditional trade issues like tariffs. Australia already has free trade agreements and low tariffs with all but three of the 12 TPP countries. Nor was it going to deliver on promises of jobs and growth. Economic studies showed hardly any economic benefit to Australia. Rather, most of the TPP’s 30 chapters laid out rules which increased rights for global corporations and restricted future governments from regulating them in the public interest.
The TPP gave global companies the right to bypass national courts and sue governments for millions of dollars in unfair international tribunals over health and environmental regulation. It extended monopolies on biologic medicines for an additional three years, delaying cheaper versions of those medicines, which would have cost taxpayers hundreds of millions of dollars per year. It also entrenched copyright monopolies. Chapters on services reduced the ability of future governments to regulate essential services. The TPP increased the numbers of temporary migrant workers who are vulnerable to exploitation, without testing if local workers were available.
The Productivity Commission criticised the TPP’s inclusion of corporate rights to sue governments and the entrenchment of monopolies as the opposite of free trade. In an era of global financial crises, corporate tax evasion and global warming, future trade agreements must not prevent governments from regulating banks and monopolies on medicines, or from acting to prevent climate change and tax evasion. Governments must be able to act in the public interest without facing the risk of being sued for millions of dollars in unfair international tribunals.
These public policy issues should be debated and decided through a democratic parliamentary process, not secretly decided through trade deals. Like many trade agreements, the TPP text did not become public until after it was agreed and could not be changed. The decision to sign it was made by Cabinet, not Parliament. Parliament can only vote on the legislation needed to implement the agreement, not the agreement itself. The TPP debate exposed this process, which was criticised by both the Productivity Commission and by a Senate Inquiry report aptly titled Blind Agreement.
There are precedents for ending secrecy in trade negotiations. The EU has determined that the full text of trade agreements should be made public before the decision to sign them. The Parliamentary process should include independent evaluations of the economic, health and environmental impacts of the agreement. Parliament should vote on the whole agreement, not just the implementing legislation.
The 12 TPP leaders met last weekend at the 21-member APEC summit in Peru to discuss other trade deals. One deal is the 16-member Regional Comprehensive Economic Partnership between the 10 ASEAN countries, China, India, Japan, South Korea, Australia and New Zealand (RCEP) which is currently being negotiated. It does not include the US, but there is some overlap with other TPP members.
There is another more ambitious long-term proposal for a future Free Trade Area of the Asia Pacific (FTAAP). This could involve both China and the US, and many of the countries involved in TPP, RCEP, and APEC, over 20 countries.
The failed TPP should not be used as a model for these agreements. Unfortunately, leaked RCEP documents show that TPP-like provisions on stronger medicine monopolies and corporate rights to sue governments are being pushed by some TPP governments in the RCEP negotiations. These proposals are generating the same opposition from public health and other community groups as they did in the TPP.
In short, the failure of the TPP should show the necessity for more open and democratic trade processes, and fair trade policies which do not entrench corporate rights and monopolies and do not prevent governments from regulating in the public interest.
Dr Patricia Ranald is a research associate at the University of Sydney and the convener of the Australian Fair Trade and Investment Network
Published: 22 November 2016
APEC: Lots of trade talk but no clear path forward (Nov 22 2016)
I'll quit TPP on day one as president: Donald Trump (SMH, Nov 22, 2016)