Extract from “Conjuring growth from the Trans-Pacific Partnership”

Provisions allowing foreign investors to sue governments in private tribunals or undermining national bank regulation, become trade-promoting cost reductions, ignoring the costs and risks of bypassing national regulations and taxation. Again, the huge gains claimed have little, if any, analytical bases in economic theory, past evidence or experience.

By understating crucial costs, projected benefits have been exaggerated. For example, provisions to strengthen, broaden and extend intellectual property rights (IPRs) become simple cost reductions that will increase the trade in services, ignoring impacts on consumers or governments subsidizing the availability of medicines besides the reduced trade in medicines due to higher prices and the prohibitions on importing generics.

The TPP’s investor-state dispute settlement (ISDS) provisions will enable foreign investors to sue a government in an offshore tribunal if they claim that new regulations reduce their expected future profits, even when such regulations are in the public interest. As foreign investors are already well protected, ISDS provisions are completely unnecessary for the TPP.

Advocates as well as critics of free trade and trade liberalization have criticized inclusion of such non-trade provisions in free trade agreements. Instead of being the regional free trade agreement it is often portrayed as, the TPP seems to be “a managed trade regime that puts corporate interests first”.

Thus, the TPP, offering modest quantifiable benefits from trade liberalization at best, is really the thin edge of a wedge which will undermine the public interest in favour of powerful, often foreign, corporate interests. Net gains for all in TPP countries are a myth. Only a full, careful and proper accounting based on the full text can determine who benefits and who loses.

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