Trade Agreements and public education: don t repeat the mistakes of the TPP Dr Patricia Ranald, Convener Australian Fair Trade and Investment Network, Research Associate, University of Sydney
Extreme trade theory: not free trade but more corporate rights Argues that global competition means greater efficiency, lower prices Each country should specialise in its most efficient products and import all other products at lowest possible prices: no diverse industry policy Can mean a race to the bottom on workers rights and environment: increased inequality Aim for zero tariffs and zero other barriers to trade and investment for global companies But other barriers can include public services like education, and other public interest regulation Recent trade agreements can restrict regulation on education, medicine prices, health, environment, industry policy, government purchasing : all issues previously decided by democratic parliamentary processes, not as part of a trade deal We need fair trade based on human rights, labour rights and environmental sustainability which allows governments to act in the public interest
Trade agreements: secret process but legally binding and enforceable Trade agreements are negotiated in secret, but legally bind lower tariff levels and other rules on investment and government regulation We don t see the details until after the deal is done Designed to "lock in" future governments, reducing democratic space Government-to-government dispute processes mean that one government can lodge a dispute if another government breaks the rules Disputes are heard by trade tribunals and penalties are enforceable The winner can ban or tax the products of the losing government Also investor-state disputes (ISDS): a single foreign corporation can sue the government for millions if they can claim that a change in law or policy harms their Investment: undermines democracy
RCEP: 10 ASEAN countries plus China, India, Japan, South Korea, Australia and New Zealand: total 16, 7 also in TPP
RCEP 16 countries include half the world s population, 30% of total global economy, 12% of world trade Half are low income or least developed countries 7 in the TPP 17 rounds of secret negotiations since 2012 Business groups present views at every round, but civil society only at four No access to negotiating documents, but some leaked documents Governments aim to finish and sign text by end 2017 We will not see the text until after it is signed and cannot be changed, parliament only votes on implementing legislation
TPP corporate agenda 12 Pacific Rim countries in the Americas and Asia, signed February 2016 US-driven agenda on behalf of major industries, China rivalry Increased corporate rights at the expense of people's rights Strong community resistance prevented US Congress approval, forced bipartisan presidential candidate opposition, Australian Senate cttee said no US withdrawal means TPP cannot proceed, but agenda lives on: Foreign corporations can bypass national courts and sue governments for millions in unfair international tribunals (Investor-State Disputes or ISDS) Stronger monopolies on medicines would delay cheaper forms of medicines from becoming available Restricted government regulation of services, including education, stateowned enterprises, food labelling and many other areas Greater numbers of temporary workers vulnerable to exploitation
RCEP: different players but some pushing TPP agenda ASEAN group of 10 major role: has FTAs with most RCEP countries No US, but not just China-led: China, India, Japan major players More of traditional trade agenda: trade in goods, agriculture, services But seven TPP countries are in the RCEP Leaked documents show Japan, Korea, Australia, NZ pushing parts of the TPP agenda Medicine monopolies, investor rights to sue, services deregulation, more vulnerable temporary workers
TPP proposals in the RCEP Leaked documents show Japan, South Korea pushing some of TPP agenda on stronger medicine monopolies, very harmful to low income countries Patenting of seeds and plants, stronger copyright monopolies Japan, South Korea, Australia supporting TPP version of ISDS enabling global corporations to sue governments Services chapter deregulates services, prevents re-regulation, encourages privatisation, increases temporary workers
Competition, services rules encourage privatisation, including education Rules do not force privatisation, but prepares public services for privatisation by encouraging competitive tendering open to foreign investors (services and competition chapters) Pressure to include all services unless listed as exemptions (negative list) Regulation cannot be increased unless completely exempted Locks in competitive tendering and deregulation, makes them difficult to reverse, eg vocational education competitive market failed, with massive fraud of government funds and students, had to be re-regulated If TPP-like rules were in place, other govts could object to re-regulation Foreign education companies could sue govt for compensation if they could argue their investment was harmed by re-regulation (ISDS)
Stronger medicine monopolies delay cheaper medicines Corporations already have 20 year patent monopolies before cheaper versions become available RCEP proposals Extension of patents for delays in marketing approval Evergreening of patents for slight changes Data protection allows an extra monopoly of at least 5 years Reduction of flexibilities for least developed countries Enforcement proposals could mean cheaper generic medicines could be seized in transit All of these proposals delay the availability of cheaper forms of medicines, which would cost hundreds of millions and be disastrous for low income and least developed countries
Foreign investors can sue governments Investor-State Dispute Settlement, or ISDS ISDS allows foreign investors to bypass national courts and sue governments for millions of dollars in international tribunals if their investments are harmed by a change in law or policy The previous Australian ALP Government had a policy against ISDS because of risks and costs to government. ALP policy still opposed. The Howard Coalition government did not agree to ISDS in the 2004 US-Australia Free Trade Agreement, but the current Coalition government has agreed to it the TPP and other agreements like RCEP
ISDS legal framework unjust Increasing numbers of cases: now over 700 outstanding cases known Originally designed to compensate for nationalization of assets by governments Now defines regulation as indirect expropriation which deserves compensation (not found in domestic law), also fair and equitable treatment No independent judiciary: tribunals include practicing advocates No precedents or appeals: inconsistent decisions Claimed recent safeguards have not prevented cases against health, environment and labour laws UN says ISDS restrains governments from protecting human rights
Tobacco companies use ISDS to undermine public health Philip Morris case against Australia s plain packaging law Public relations campaign before law passed in 2011 Tobacco company High Court claim for compensation failed in 2012 Philip Morris, a US company, could not use US-Australia FTA because no ISDS clauses, shifted assets to Hong Kong to use ISDS in Australia-Hong Kong agreement Took over 4 years and $50 million legal costs for tribunal to decide that Philip Morris was not a Hong Kong company in December 2015 Other governments delayed similar laws: freezing effect Australia won on jurisdiction, but main issue about the law not addressed TPP excludes tobacco regulation, but not other public interest law
Health, environment, labour and privatisation cases 2016 Novartis case against Colombian govt attempt to make a cancer drug affordable US Lone Pine energy company is suing the Canadian provincial government of Quebec for $250 million because it suspended shale gas mining pending an environmental study (2012) French Veolia company is suing Egypt over a rise in the minimum wage as part of a dispute over a local government contract (2012) Mexican transport company ADO recently threatened Portugal with a 42 million ISDS case after it cancelled plans to privatise part of Lisbon's public transport network (2016)
RCEP proposals undermine human rights Doctors without Borders (MSF) says RCEP proposals would deny access to medicines RCEP could block access to life-saving drugs for millions. nearly half of the global population relies on low-cost drugs from India and China, including two thirds of all the drugs MSF uses to treat HIV, tuberculosis and malaria ISDS cases undermine regulation to make medicines affordable UN Report on ISDS ISDS is incompatible with human rights principles because it encroaches on the regulatory space of states and suffers from fundamental flaws including lack of independence, transparency, accountability and predictability. No RCEP commitments to enforceable ILO labour rights, UN environmental protections
Resistance from community groups and some RCEP governments Statement signed by AFTINET, AEU and over 80 groups in 13 RCEP countries against secrecy and asking for dialogue with negotiators and release of the text now and before signing Statements signed by even more groups against TPP proposals on stronger medicine monopolies, ISDS Critical public forums and demonstrations at recent negotiations in indonesia, Japan, Philippines India and ASEAN countries resisting stronger medicine monopolies TPP version of ISDS, services deregulation: negotiations slow Other differences on tariffs, temporary migrant workers
Fair Trade: trade should improve peoples lives Trade agreements should support, not restrict, policy for a diverse, inclusive, balanced, environmentally sustainable economy, with education for all Open and democratic trade process, release negotiating text and final text before it is signed Independent studies of economic, social, health and environmental impacts before signing Trade agreements should be based on enforceable labour rights and environmental standards, not a race to the bottom No extension of medicine, copyright or other monopolies in trade agreements No ISDS No restrictions on regulation of education, health services or other public interest regulation
The Australian Fair Trade and Investment Network (AFTINET) AFTINET is a network of 60 community organisations and many individuals advocating for fair trade based on human rights, labour rights and environmental sustainability Campaigned successfully with others in TPP countries against the TPP corporate agenda, which was not endorsed by parliament Campaign to keep TPP out of RCEP with similar groups in other RCEP countries www.aftinet.org.au http://aftinet.org.au/cms/regional-comprehensive-economic-partnership- RCEP Facebook www.facebook.com/aftinet? twitter @AFTINET