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Why you should care about the Trans-Pacific Partnership

WHEN Australia became the first country in the world to outlaw tobacco branding in 2011, it was hailed as a victory for the health lobby and a blow to big tobacco.

Australia’s parliament had decided that it would change the rules around what constituted acceptable marketing for an addictive product that kills people.

That seems fair.

Big tobacco did not see it that way, and Philip Morris Asia set about trying to find a way to claw back what it saw as its right to market carcinogens in a more palatable light.

It soon found a way — a trade agreement signed between Australia and Hong Kong back in 1993 that dealt with the “promotion and protection of investments’’.

Philip Morris’s case, which is ongoing, is the first ever “investor state dispute” lodged against Australia.

But the fear is that the Trans-Pacific Partnership, which the Australian Government and 11 other countries around the Asia Pacific region are currently negotiating, will open the floodgates of Investor State Dispute Settlement (ISDS), eroding our ability to set our own laws and benefiting big business to the detriment of everyday citizens.

The TPP is one of those issues that elicits dire warnings about the rise of a New World Order’, with Machiavellian business leaders pulling the strings while chomping away on Cuban cigars.

Activist group GetUp calls it “the scariest treaty you’ve never heard of’’, and this week WikiLeaks reportedly offered a $100,000 reward for all 29 sections of the agreement.

In short, the TPP is a trade deal between 12 countries, including the US and Australia, all around the Asia Pacific, covering about 800 million people and about 40 per cent of world GDP. It does not include China.

As with most trade treaties, the idea is to make trade between countries easier. The TPP wants to try to remove tariffs, but also to remove many of the “non-tariff barriers” to trade.

This means there is a push for uniformity, or recognition of the validity of a country’s regulations in areas such as labelling laws, food safety and copyright protection. These barriers can be even more damaging to international trade than tariffs, with countries able to block the entry of products if they don’t meet local guidelines.

Another benefit expected to flow from the TPP is the mutual recognition of qualifications, meaning that professionals such as architects and engineers could more easily work internationally.

But one of the concerning quirks of the TPP is that Joe Public won’t get a look at it until it’s been signed.

A treaty of extreme secrecy

Despite it having been debated back and forth for the past decade, no-one knows what’s in the TPP.

Australian politicians have been told they can view the documents, but only if they agree not to talk about what they have seen for four years. This is despite the fact that the agreement is expected to come into force within months. Trade Minister Andrew Robb has said, however, that the public will get to see the text once it is signed off, and before it comes into legislative force.

There are some key fears around the TPP, including that:

ISDS rules will erode government’s ability to make decisions and will open them up to multi-billion dollar lawsuits;

PRICES for generic drugs will increase;

JOURNALISTS could face significantly weaker whistleblower protections, and;

IT it will make sending low-wage jobs offshore easier.

The fear over ISDS is not an idle one.

ISDS basically allows companies to sue when the rules are changed and they stand to lose money, and it’s becoming more popular.

The North American Free Trade Agreement between the US, Canada and Mexico contains ISDS clauses that some consider to have been designed to protect US companies against Mexican law changes.

In her submission to the Australian Government on the TPP, Dr Kyla Tienhaara from the Regulatory Institutions Network at the Australian National University points out that by May 2010 Canada had received 27 notices of intent to launch ISDS claims, with several of them either settled or going to court.

In one case, Dow AgroSciences launched a claim against Quebec after a particular chemical was banned for use as a pesticide on lawns.

While the regulators were being conservative and banning the chemical despite no firm evidence of harm, the company argued that it was a restraint of trade.

In 2012, the Swedish nuclear energy company Vattenfall launched an ISDS claim worth 3.7 billion euro against Germany after it decided to phase out nuclear power following the Fukushima nuclear disaster.

Locally, if the Australian government was to decide, for example, to revoke the right of companies to explore for oil in the Great Australian Bight, as is going on now, it would open itself to an ISDS claim.

Dr Tienhaara says there has been an “explosive increase” in ISDS claims in recent years and “the Government should strongly oppose the inclusion of Investor-State Dispute Settlement in the Trans-Pacific Partnership Agreement’’.

The Government, which says its “decision to participate in the TPP in 2008 followed an extensive public consultation process”, assures the public that it should not be too concerned about the issue.

“Australia would retain the ability to regulate legitimately on social, environmental or other similar public policy matters,’’ a Government presentation says.

“Australia is considering the inclusion of Investor-State Dispute Settlement (ISDS) provisions in free trade agreements on a case-by case basis.’’

ISDS is not the only cause for concern, however.

So who wins from the TPP?

Nobel prize-winning economist Joseph Stiglitz believes the TPP “will benefit the wealthiest sliver of the American and global elite at the expense of everyone else’’.

He is worried, like many others, that standardisation of regulations means we will end up with the weakest regulations, allowing corporations to do as they please.

“There are other noxious provisions,” he says. “America has been fighting to lower the cost of health care. But the TPP would make the introduction of generic drugs more difficult and thus raise the price of medicines.”

The same concern has been raised in Australia by generic drug maker Alphapharm, which says that it produces one in five of all drugs supplied under the Pharmaceutical Benefits Scheme.

There are also fears that the TPP could criminalise whistleblowers and journalists. Earlier this month, hundreds of US tech and media companies sent a letter to the US congress warning “TPP’s trade secrets provisions could make it a crime for people to reveal corporate wrongdoing ‘through a computer system’”.

“The language is dangerously vague, and enables signatory countries to enact rules that would ban reporting on timely, critical issues affecting the public.’’

There are also stronger powers in leaked elements of the TPP for copyright owners to track down people who illegally download content.

While these fears are all valid, without seeing the documents it is impossible to make an accurate judgment of what the final agreement will look like.

For his part, Mr Robb has dismissed fears that the government will be selling the nation down the river as a signatory to this deal.

“Why would I set out to make Australians materially worse off?’’ he said recently.

Mr Robb argues that sectors such as tourism, hospitality and agriculture stand to gain substantially from the TPP.

“There are enormous growth opportunities for us at the premium end of markets across the Asia Pacific on account of our reputation for ‘clean, green and safe’ produce,” he says.

“Modelling conducted by the US Department for Agriculture shows Australian exporters would be the biggest beneficiary of all 12 countries under the TPP.

“When you add these gains to the benefits that will flow from the powerful trifecta of North Asia agreements … there is cause for real optimism around Australian agriculture.”

‘This will undergo extensive scrutiny’

Mr Robb says claims about secrecy and lack of transparency are “overblown”.

“Of course there is a degree of confidentiality around the negotiations, as there is with any commercial negotiation, but there is also extensive consultation with a wide range of stakeholders throughout,” Mr Robb says.

“This consultation is invaluable in both informing and guiding our approach to what are typically complex issues. There have, in fact, been more than 1000 TPP consultations since 2011 and these continue.

“Finally, the TPP text will not be kept secret.

“Once it is agreed between parties, it will be made public and also subjected to extensive scrutiny and inquiry before implementing legislation is considered and voted on by the parliament.”

The Dean of the School of International Studies at Flinders University, Martin Griffiths, believes the need for US president Barack Obama to get the TPP through Congress will filter out many of the more contentious elements.

“The difficulty in the United States with this agreement is with the Democrats, which is Obama’s own party,” he says.

“These kinds of agreements get a lot of hostility within the Democrats because they tend to benefit wealthier workers … because they’re linked to the outsourcing of jobs.

“It’s a very political document and because it is political I suspect we won’t have much to worry about.”

Mr Griffiths says Japan is very protective of its sovereign rights, and the US agriculture lobby will not stand for an agreement that seriously erodes protections.

Mr Griffiths says the US could be using the TPP as “bait” to attract China into a closer relationship with the region and the US, and this also weighed against an agreement that would seriously reduce sovereign rights.

“I would suspect that our biggest fears, despite the secrecy, are unfounded,” he says.

Many remain unconvinced however, including the 85,551 signatories to GetUp’s online petition.

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