Many good reasons to make noise over TTIP
yet its primary function is to create the world’s biggest free-trade zone and increase transatlantic business and profits.
Last week, the US and EU concluded their 14th round of negotiations as US resident Barack Obama hopes to finalise TTIP before leaving office in 2017.
TTIP negotiators state the agreement will help small and medium enterprises in particular, arguing those who sell artisan products such as cream cakes and chocolate need a trade agreement to do more business across the pond. However, analysis of TTIP’s impacts in Ireland demonstrates that the biggest winners will be the electronics, pharmaceutical, and chemical sectors — industries that already have strong multi-national ties between the US and EU.
The biggest losers from TTIP are expected in the European agricultural sector, particularly grassland beef.
A report by Friends of the Earth Europe reviewed modelling studies on the impacts of the TTIP on agriculture, which foresaw a net trade benefit to US interests of over €4bn.
Farmers across the EU face stronger competition and lower prices as a result of TTIP, threatening farm businesses as well as rural areas and consumer interests. Within the food sector, the winners from TTIP will be corporate food giants and US factory farms with bigger economies of scale and lower production costs.
Yet surprisingly, our Agriculture Commissioner Phil Hogan and Taoiseach Enda Kenny promote TTIP and seem willing to sacrifice agriculture to avail of opportunities in other sectors.
One of the most contentious aspects of TTIP is its inclusion of an ‘investor-state dispute settlement’ mechanism or ISDS. This trade court allows companies to sue foreign governments when profits are compromised by new laws or practices.
TTIP is one of several controversial trade deals being negotiated by the EU that includes such a mechanism. Last week, the European Commission proposed the provisional application of a similar trade deal between the EU and Canada (CETA).
Corporations have already used ISDS mechanisms to challenge governments more than 600 times.
Many of these challenges were related to health or environmental decisions by governments, including within the energy sector: In 2010, the US challenged one of China’s wind power subsidy programs because it supported local industry and was considered protectionist; In 2012, the US oil company Lone Pine used the North American Free Trade Agreement (NAFTA) to challenge Quebec’s fracking moratorium; and TransCanada recently announced it was suing the US government for $15bn after Mr Obama rejected the Keystone XL pipeline to pump oil from Canadian tar sands.
TTIP proponents argue cases taken by investors are usually unsuccessful, but ISDS costs tax-payers billions and makes governments nervous of enacting legislative changes that benefit citizens at the expense of foreign investors.
This week, a leaked document obtained by Friends of the Earth Europe regarding the EU’s proposal for an energy and raw materials chapter within TTIP showed it will weaken European progress on energy efficiency and renewable power.
Driven by the EU’s desire for cheap US natural gas (mostly hydraulic fracturing of shale), the chapter eliminates all restrictions on natural gas export, leading to more fracking in the US and more imports of American fossil fuels to Europe.
The draft chapter also encourages self-regulation over mandatory energy efficiency legislation and requires energy networks not to discriminate between energy sources, thus preventing legislators from prioritising renewables over fossil fuels.
Governments already weak on climate action, such as Ireland, may cave to corporate pressure under TTIP rather than reduce greenhouse gas emissions in line with the Paris Climate Agreement.
There is practically no barrier to trade between the US and Europe — most tariffs are less than 3% . Rather, TTIP is about deregulation and creating opportunity for corporations to roll back US or European rules that impact profits.
MEP Brian Hayes has said non-government organisations are “just making noise for the sake of it” and creating “cheap publicity” by alerting the public to TTIP. Since almost no one gets to read the draft text of TTIP it is difficult to evaluate its potential outcomes, but TTIP’s lack of transparency and numerous potential risks to Irish interests warrants some serious “noise”.
Environmental scientist, chair of Friends of the Earth Ireland. Blog: ‘The Verdant Yank’ on www.CaraAugustenborg.com
Twiter: @CAugustenborg.
