Breaking down the monster TPP text

Each chapter of the Trans Pacific Partnership requires close inspection and public consultation. But if successful, the TPP has the potential to be much more than a trade deal — it’s a bold experiment in supranational government. 

By: /
November 17, 2015
Vietnam's textiles and footwear industries are expected to gain strongly from the TPP. REUTERS/Kham

The recent disclosure of the full text of the Trans-Pacific Partnership (TPP) ended years of speculation about a trade deal comprised of 12 states amounting to 40 percent of the global economy. Until now, the debate has largely focused on how the TPP affects specific industries like dairy, auto manufacturing, and pharmaceuticals. Narrow readings of the text, followed by headline-friendly proclamations that it could be “the worst thing in policy” that Canada has ever done are not helpful in furthering a comprehensive and critical analysis.

Analysis that fails to appreciate the agreement as a whole misses a bigger, more radical picture. The TPP is much more than a trade deal. It is a bold experiment in a new type of global partnership, creating a quasi-supranational government with the potential to transform whole societies. 

A close reading of the text reveals many reasons for caution (and by virtue of the agreement’s scope, no one is ever going to be entirely satisfied). But within the text’s 6,000 pages, chapters on investment, labour, the environment, and development give reason for cautious optimism that the TPP is not only a boon for big business.

Favouring local or foreign investment

First, dispelling the idea that the TPP only serves the interests of investors and corporations, the chapter on investment actually scales back a foreign corporation’s ability to sue host governments. International legal concepts addressing basic standards of treatment used to launch these suits are restrictively defined in the TPP, narrowing their applicability to instances of denials of justice and failures to extend police protection to an investment. 

In matters of equal treatment between local and foreign investors, another common ground for investor-state claims, the TPP actually permits positive discrimination on the basis of “legitimate public welfare grounds.” The investment chapter also affirms a state’s right to act in furtherance of its “environmental, health or other regulatory objectives.”

Relying on these provisions, the Canadian government would be on sound legal footing if, for instance, a regulatory competition favours a local Aboriginal group over a conglomerate based in Singapore. (Yes, foreign investors can always put forward legal arguments attempting to show that they were unfairly discriminated against, and that a state has not acted in the legitimate interest in doing so, but the text of the TPP’s investment chapter places a heavy onus on an investor to prove that. Underlying the narrow construction of the text is an assumption that states must maintain regulatory flexibility to respond to their specific challenges and needs.)

Improving global labour standards

Shifting away from the trade and investment chapters, TPP chapters addressing societal issues, like labour and the environment, present the most innovative aspects of this experiment. They also present the biggest challenges and opportunities for the 12 governments behind it.

The chapters contain benchmarks on labour and environmental standards each state should adhere to, and at times, make specific reference to existing international agreements. Ambitious and suggestive language is par for the course in international agreements, which can be criticized for lacking enforcement mechanisms. The TPP tries to remedy this shortcoming, building in accountability mechanisms — high-level governmental committees, to monitor and improve the adherence to these standards. 

While the potential is certainly there for this to become another example of ineffective global bureaucracy, the TPP now mandates a forum where Canada can engage with Asian states trying to root out forced labour in their supply chains. It now becomes our job to ensure that migrant workers in Malaysia are treated fairly, and likewise, it is now Malaysia’s job to ensure that migrant workers in Canada are treated fairly. The underdogs have expanded access to allies. 

The potential benefits of this cooperation can already be seen. A side agreement the U.S. concluded with Vietnam as part of the TPP requires Vietnam to introduce a number of legal reforms to guarantee workers rights, including the right to unionize and strike. It also allows the U.S. to withhold eliminating tariffs if Vietnam does not comply. In Vietnam, it is being called “a very big challenge,” but one that is “very good for workers.”

No climate considerations?

Similar opportunity exists in the chapter on the environment. It mandates a committee for high-level state engagement, and includes benchmarks on conservation, biodiversity, and pollution — though it is disappointingly timid on climate change, a term not used once. The chapter on development, along with its committee, lists improving access to economic opportunity and women’s empowerment and inclusion as goals.

Skepticism is healthy when confronted by ambitions of such scope and breadth. Enforcement of these standards will be challenging; too much is left to voluntariness. Principles of corporate social responsibility are something parties are encouraged “to adopt voluntarily.”

Still, each of the chapters requires public participation and that affected and interested parties are afforded opportunities to raise grievances and allegations of shortcomings. Do Canada’s remade environmental assessment laws afford enough public participation in the decision-making process? Is Vietnam doing all it can to combat trafficking in endangered species? Are women’s cooperatives in rural Peru being given the same access to markets as factories run by multinationals? 

Without the TPP, these are individual issues, left to individual civil societies to petition individual governments. With the TPP, however, the urgency and impetus to resolve these questions is greater and becomes a matter of near-global concern. With this expanded discussion revolving around established benchmarks, the potential for accountability is greater and sovereignty is no longer a valid excuse in the face of obvious shortcomings.

If these chapters are fully leveraged, the TPP has the potential to remake much more than how we trade; it can remake how we live.