Massive hidden cost of RCEP revealed
8 December 2016: We know from leaked documents that there is a push to include investor rights to sue governments (ISDS) in the RCEP trade agreement being negotiated in Indonesia this week. Now, a new report has revealed the growing use of corporate lawsuits against Asian countries and warns that ISDS provisions in the RCEP could lead to millions of dollars being drained from public budgets in the region.
The report by The Transnational Institute (TNI), Friends of the Earth International (FOEI), Indonesia for Global Justice (IGJ), Focus on the Global South and Paung Ku reveals that investors have launched 50 lawsuits against governments negotiating the RCEP agreement for at least $31 billion US dollars, with the largest known amount paid to a foreign investor by an RCEP country so far being $337 million USD.
Friends of the Earth International campaigner Sam Cossar-Gilbert told the media:
"The secrecy surrounding investor-state arbitration means these figures could be just the tip of the iceberg. The huge sums of money involved leave no doubt about the unacceptable burden that this dangerous mechanism puts on countries across Asia. If the RCEP trade deal goes ahead as planned, we expect to see an increase in multi-billion dollar claims – and citizens being forced to foot the bill.”
Cecilia Olivet, researcher at the Transnational Institute, said:
"Investors are already using investment agreements to raid cash-strapped public budgets in Asia. Granting corporations the same excessive rights in the even more far-reaching RCEP trade deal would be political madness. It is time to reject a privatised justice system that can undermine crucial regulation in the public interest.”
- Read the report: The hidden costs of RCEP and corporate trade deals in Asia
- Read media coverage on the ABC: Multinationals launch 50 lawsuits worth $31b against Asian nations
- Find out more: Is the RCEP the TPP by another name?