The Multi-Headed Hydra of American Trade Agreements
This week the EU council announced the blocking of the Comprehensive Economic and Trade Agreement (CETA) – the free trade deal poised to be negotiated between Canada and the EU. This was the latest in a string of agreements which Obama and the U.S government have been racing against time to sign before he leaves office.
The agreements have come under intense scrutiny in Europe, with protests taking place across European capital cities in an attempt to stop the signing. The criticism has centered on the assumption that free trade agreements like the TTIP, CETA and the TTP before it, will provide private corporations and banks with more profits and power to transcend governmental policy.
While Obama enjoyed success in getting the Trans-Pacific Partnership Agreement (TTP) signed last February, since then the Transatlantic Trade and Investment Partnership (TTIP) between the US the EU has been fraught with obstacles and after fourteen rounds of negotiations it looks unlikely to be passed. The agreement was said to be worth around $34.2 billion to US companies and banks but in the face of mounting public pressure negotiations have been put on ice.
Combined, the TTP and TTIP would allow Wall Street to control more than half the total trade conducted on the planet.
The latest free trade agreement was hatched in Geneva and brought to the table. The Trade in Services Agreement (TiSA) is being kept under wraps so as to avoid the pitfalls of its predecessors but it is very much alive.
Documents on Wikileaks, the veracity of which may be questionable, show that TiSA has been on the table since 2013 and looks to be the most significant yet proposed. It is looking to pen the signatures of fifty countries, including the EU member states, and incorporates legislation on all aspects of the service industry from tourism and hospitality to the financial services, healthcare and education.
The agreement itself aims to constrain governmental ability to regulate service industries around the world, opening the door to increased privatization. Despite the EU claiming that public services will be excluded from the TSiA negotiations, the leaked documents reveal that the EU is demanding the inclusion of public services of developing countries, paving the way for big businesses based in Europe and the US to privatize public services in developing countries.
Countries like Costa Rica, Panama, Pakistan and Mauritius are being promised a boost in investment and jobs for the local people, however under the model leaked by Wikileaks, which might not be accurate, they would be in no position to demand the hiring of local people. The foreign businesses would be free to use their own work-force and managers with impunity. On the face of it, the proposed agreement appears to be another way of exploiting the developing world by privatizing their public services and funneling the profits out of the country.
The agreement seeks to deregulate the financial sector in a similar fashion. It would prevent governments from limiting the size of a financial institution, ensuring a continuation of the “too big to fail” mentality that has led to public funds being used to bail out banks across the planet. It would also limit consumer protection by restricting the ability of governments to ban risky financial products being sold to the consumer. The twenty-first round of negotiations are currently underway in Geneva as we speak and businesses want to see it signed before the end of 2016.
Along with the TTIP and CETA, TSiA has to be viewed as a promotion of American businesses through political avenues. America is undergoing a deindustrialization process which has seen many industrial jobs outsourced to countries like China and the result is an increasingly large service industry. More than three quarters of American GDP comes from its service industries and TSiA must be seen in this context, as an attempt to open the markets of developing countries to the plunder of big American and European businesses.
The blocking of CETA and the stalling of TTIP show that two of the Hydra’s heads have already been decapitated. While the TSiA is larger and more all-encompassing, it still needs to be met with the same public resistance and thirst for information that buried the others. The World is not for sale.