Tuesday, June 30, 2015

Trans Pacific Partnership. Why we don't know what we are giving away

The US Senate has given the green light, and Australia is set to buckle. If you don't yet know what TPP stands for, listen up. Our government could sign it within weeks. Only then will we really know what's in it.

That's right. As with the China-Australia Free Trade Agreement and the Japan-Australia Free Trade Agreement, the content of the Trans-Pacific Partnership will remain secret right up until the day it is signed. Afterwards, our parliament will be able to look at it, but not to change it. Alice is inside the looking glass.

A Senate committee reported on the processes surrounding the TPP on Thursday. It said the parliament would be presented with an all-or-nothing choice. It could examine the TPP (after it had been signed) and either vote for or against it, but not change a word.

The Department of Foreign Affairs and Trade was a lone voice at the hearings supporting the present arrangement (even it relented afterwards, allowing members of Parliament to see a copy of the draft TPP in a locked room on the condition that they made no copies themselves, took no notes and breathed not a word to anyone outside the room).

It said anyone who had wanted an input into the agreement could have sent it a submission. But it missed the point. It's hard to know that you need to write a submission if you don't know what's being proposed...

Trish Hepworth of the Australian Digital Alliance said most people when they hear there is going to be a trade agreement don't think: "Oh my goodness,  I run a library; there is a trade agreement; this is going to mean I cannot digitise newspapers past 1955 anymore." Yet she said that is what happened as a result of Australia-US Free Trade Agreement.

The department runs consultation sessions with community groups, providing "over 1000 stakeholder briefings on the TPP alone since 2011", but they have been curiously bereft of information. Alan Kirkland from the consumer group Choice said the meetings take the form of "tell us your views". The Australian Industry group said attending them is like "voicing concerns blindfolded".

It matters because these days so-called trade agreements are about far more than trade. The Productivity Commission insists on calling them "preferential" rather than "free trade" agreements, arguing that they often impede trade. Australia's 1800 agreements overlap and interfere with each other in ways that are hard to see through. In order to get preferential entry to the United States under the US agreement, Australian firms are not allowed to use more than a certain percentage of materials that come from other countries such as New Zealand, even though New Zealand goods are allowed into Australia duty-free, and so on.

A study of the Australia-US free trade agreement 10 years on found it had most probably cut rather than boosted Australian trade. Beforehand we were told it would be worth billions.

Many businesses won't use them. "The paperwork to qualify was so enormous it wasn't worth the effort," said one of the respondents to a Chamber of Commerce survey.

Until four years ago the Stafford Group made Anthony Squires suits at Preston in Melbourne. It had suited up every Australian prime minister from Menzies to Rudd. It was happy to pay duty on the fabric it imported, knowing its New Zealand competitors had to pay it too. Then a changed interpretation of the rules meant New Zealand manufacturers were able to use duty-free cloth to make suits for Australians (although not for New Zealanders). Stafford appealed to prime minister Gillard, was turned down, and moved production to Fiji.

The Trans Pacific Partnership agreement being negotiated between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam holds out the promise of actually breaking down barriers. But the leaks suggest its provisions will be inconsistent with those of existing agreements, creating still more red tape. The Chamber of Commerce and Industry begged the Senate inquiry for a "one in, one out" rule under which obsolete agreements would be cancelled as soon as new ones came into force. It calls the mess we've got: "the noodle bowl".

Last week the US Senate gave President Obama fast-track authority to quickly conclude the Trans Pacific Partnership talks. Leaks published by Wikileaks suggest the big changes for Australia would relate not to trade, but to intellectual property and so-called investor-state dispute settlement. The Coalition's John Howard successfully resisted the incorporation of ISDS provisions into the Australia-US agreement in 2004. This time the US is more insistent. It says there will be no agreement without them.

ISDS clauses allow foreign firms (but not local firms) to sue the Australian government in foreign tribunals over decisions they don't like. A tobacco company is doing it now using the terms of an obscure Hong Kong Australia agreement. The Productivity Commission says the number of ISDS cases worldwide has grown from almost none in 20 years to around 600 today. The Chief Justice of the High Court says they are a threat to national sovereignty.

The Medical Journal says the leaked intellectual property changes seem designed to keep pharmaceutical prices high.

Trade minister Andrew Robb accuses critics of the as -yet-unseen agreement of being anti-trade. But they're not. There's no greater believer in free trade than the Productivity Commission, and few organisations more enthusiastic than the Chamber of Commerce and Industry. It's the new layers of red tape that worry them, and the add-ons – changes to Australian law that wouldn't stand a chance of making it through Parliament if they were proposed and debated in in their own right.

In The Age and Sydney Morning Herald