Viola Palmer: Making trade agreements people friendly

Companies like Fonterra may benefit from increased access to markets from trade agreements.

Companies like Fonterra may benefit from increased access to markets from trade agreements.

OPINION: The trade agreements at present being negotiated are seriously unfriendly to citizens.

We were saved from the Trans Pacific Partnership Agreement (TPPA) because it was Trumped. New Zealand officials are still pursuing it and other "trade" agreements. The TPPA is being resuscitated as TPP11, as it now has 11 participants which include New Zealand and 10 other Pacific rim countries.

Given that the main purpose of the TPPA was a free trade agreement with the US, one wonders why our Government is still so keen on it. The other agreements being pursued are:

  • RCEP: Regional Comprehensive Economic Partnership which includes the 10 Asean countries, plus Australia, China, India, Japan, New Zealand and South Korea.
  • TiSA: Trade in Services Agreement. It includes the European Union, New Zealand  and 21 other countries.

What's wrong with these agreements?

As a trading nation New Zealand needs rules around global trade and investment. My objection to the TPPA was that it gave far too much power to multinational corporations. Some of them have an economic base larger than that of New Zealand. The terms of the TPPA could restrict governments from legislating for the public good if such legislation ran foul of a corporation's profitability.

Negotiations are being conducted without public awareness or consultation, whereas corporations have substantial input. Companies like Fonterra may benefit from increased access to markets but the reciprocal cost of providing increased access by foreign corporations could well prove disastrous to our communities and environment.

During my lifetime I have seen the reduction of expertise and manufacturing in New Zealand due to trade. Clothing, footwear, carpet, ceramic manufacturing have all but disappeared, together with car assembly. This affects our independence and resilience. Trading is a fine balancing act.

The most undesirable feature of these agreements is the Investor State Disputes Settlement process (ISDS). A corporation likely to have profitability reduced due to government action, can take the government to an overseas tribunal for adjudication. These tribunals are three member appointees, often previous trade officials, who consult in a distant venue away from the eye of publicity. There is no right of appeal.

This process has crept into recent agreements. It is not present in older agreements. Though they have not yet hit New Zealand, there are currently about 50 ISDS hearings worldwide.

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The chilling effect of ISDS is such that I doubt if the Smoke Free Environments Act 1990 would have been passed if ISDS provisions had been present then.

Some of the other downsides of the agreements are:

The TPPA would threaten privacy and security on the internet. It would restrict internet freedom, reducing access to knowledge and building barriers to news and cultural exchange. It would lengthen the duration of patents, leading to restriction of generic medicines, keeping them unaffordable for many.

A TiSA would make it easier for service providers such as banks, insurance companies, health providers. freight companies, and internet providers, to sell services in another country by stripping away regulations which protect workers, control financial services, or new technologies (think drones, robots). Foreign contractors could bring in their own nationals to do a job in NZ. Governments could be punished for requiring disclosure of the use of tax havens, protecting the domestic economy and jobs, or regulating the flow of hot money.

What would a people-friendly trade/investment agreement look like? Some of the features are:

  • It would be conducted openly with drafts being debated in Parliament.
  • Disputes would be adjudicated in the country's courts, not in distant tribunals.
  • It would preserve the right of each nation to protect the public interest and the environment.
  • It would allow each nation to regulate overseas investment.
  • It would promote free flow of knowledge and information.

The nub of democracy is the ability of government to legislate for the benefit of the people. These partnership agreements need to be approached with eyes wide open.

Former GP Viola Palmer chaired the Group Against Liquor Advertising, during which she observed the power of multinationals to influence public health legislation.

 - The Dominion Post


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