Corporations like Monsanto, Nestle, Toyota and the big
pharmaceuticals are amongst the world’s most powerful economic actors hard at
work promoting an increasingly complex web of bilateral deals aimed at opening
up trade and driving down wages and conditions.
Their ultimate aim is a transatlantic deal between the
European Union and the United States. For the time being, they will be
satisfied that after four years of negotiations, the EU and Canada have signed
a multibillion-dollar trade pact that will integrate two of the world's largest
economies.
The deal removes some of the barriers impeding the expansion
of the global corporations, and makes the Canadian marketplace the only one of
the rich G8 countries with open borders to both the North Atlantic Free Trade
Area and the European Union. The EU has recently completed smaller agreements
with South Korea and Singapore.
The big prize for the corporations is a Transatlantic Trade
and Investment Partnership (TTIP) between the United States and the EU. A second
round of talks scheduled for early
October was one of the casualties of the US government shutdown. It is far from
clear whether they will restart during the US Congress self-imposed three-month
extension of its power struggle over government spending.
Signing a deal is considered as second best to the World
Trade Organisation’s failed Doha round of negotiations. Though informal Doha
talks continued last week in Bali, differences over agricultural imports
effectively brought the process to a halt in 2008 after seven years of
unresolved conflicts between developed nations led by the European Union, the
United States and Japan, and the major developing countries - India, Brazil,
China, South Korea, and South Africa.
On Monday, the three member states of the Russian-led
Customs Union involving Belarus and Kazakhstan agreed with India to start
preparations for their own free trade agreement, even whilst negotiations
between India and the EU, started in 2007, remain stalled since a meeting
earlier this year.
Whatever the obstacles presented by national interests, the
internal and external pressures on corporations to expand their operations in
search of cheaper labour and bigger markets are irresistible. A new study from
the Seattle
to Brussels Network (S2B) reveals the corporate forces at work pushing for
the proposed EU-US deal and warns of the likely damaging consequences for basic
rights, workers and the environment.
Despite the ritual claimed objectives of jobs and growth,
the experience of the 1994 North American Free Trade Alliance – the world’s
largest trading bloc linking Canada, Mexico and the United States – is precisely the opposite. US president
Clinton promised 20 million US jobs. The result? A net loss of almost a million
and a downward pressure on wages as jobs followed investment across the border
to Mexico.
Harmonisation of EU-US regulations will be designed to
ensure a race to the bottom. America’s refusal to ratify key International
Labour Organisation standards and conventions would almost certainly be replicated in Europe, adding to the intensity of conditions resulting from the recession.
In the name of “restructuring”, an EU-US deal would increase pressure for the
adoption of US anti-union “right to work” laws.
In order to boost transatlantic trade, TTIP would remove
environmental protection – including the European “precautionary principle”
approach - through the proposed “mutual recognition” between EU and US
environmental standards.
TTIP would ensure the progressive concentration of even
greater economic powers in the hands of large agribusinesses at the expense of
consumers and farmers, says S2B. Recently agreed restrictions on fracking could
be overturned. National encouragement favouring local production would be
outlawed. Resistance to GM foods would be defeated. S2B warns of the proposed
deal:
“What emerges then is an understanding of TTIP as the
political project of a transatlantic corporate and political elite which, on
the unfounded promise of increased trade and job creation, will attempt to
reverse social and environmental regulatory protections, redirect legal rights
from citizens to corporations, and consolidate US and European global
leadership in a changing world order.”
They’re not wrong.
Gerry Gold
Economics editor
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