16 FEBRUARY 2011: The fifth round of TPP talks began in Santiago this week, with US pushes for more aggressive IP reform in the text expected to be a major source of debate and commentator discussion.
New Zealand, along with one another country, is understood to have submitted a draft text on IP, described as 'relatively progressive' compared to the IP provisions contained in most modern US FTAs.
As covered previously on TPPDigest, NZ negotiatiors have expressed concerns at the US's more aggressive demands on IP in the talks, which were understood to expand on IP provisions in the US-Australia FTA and make up for ground conceded in the current version of the Anti-Counterfeiting Trade Agreement (ACTA). The US reportedly submitted its own draft text to negotiators at the same time as NZ.
As with the Auckland talks last December, public statements on the progress of the talks are expected to limited to brief press conferences with stakeholders and the media.
However, delegates will be presented with signed open letters and petitions from civil society groups in Australia, Malaysia, Chile, NZ and the US asking that negotiations be made public and transparent. Negotiators will also be presented with a paper authored by Professor Jane Kelsey and Third World Network's Sanya Reid Smith, linking the agreement to continued international financial instability and offering a mock draft text.
Professor Kelsey says the current negotiations fail to recognise that the 2008 global financial crisis was the product of excessive liberalisation and deregulation, and that rather than rethinking an unsuccessful model, the TPPA negotiations appear to be bolting the door closed on the options for governments to re-regulate the financial sector and impose controls on speculative capital flows in ways that meet the needs of their people”.
The mock text is intended to approximate the actual text, still under negotiations conducted in secret. It is based on existing FTAs between the US and Singapore, Australia, Chile and Peru.
The authors recommend that financial services, financial investment and movement of currency are all excluded from the TPPA. Failing this, the agreement must provide allowances for national governments to continue to regulate the financial sector and financial transactions so as to prevent another crisis in the future.
12 FEBRUARY 2011: TPPWatch report that over 800 individuals and dozens of national representative organisations have now signed a letter calling on NZ Prime Minister John Key to release the text of the TPPA for public scrutiny.
Signatories include the NZ Council Of Trade Unions, Oxfam, church leaders, social justice groups, and IT and open-Internet advocacy groups.
National Distribution Union general secretary Robert Reid says that as the issues being negotiated run deeper than mere trade in goods, and to key issues of economic sovereignty and domestic powers to regulate foreign firms, discussions cannot be conducted in secret. The letter may be seen and signed here.
To coincide with the beginning of the next round of talks, a demonstration is being held at Wellington's Midland Park at 12.45pm on Monday 14th of February, which will then proceed to the Ministry of Foreign Affairs and Trade in Lambton Quay.
8 FEBRUARY 2011: Prime Minister John Key has come in for heavy criticism from some trade commentators and activists, following a statement by Assistant US Trade Representative Barbara Wiesel that a statement of his on the inclusion of investor-state dispute mechanisms in TPP had been retracted.
Last November, Key said that the possibility of investor-state clauses that allowed foreign firms to sue New Zealand in TPP was 'far-fetched'.
Now, Radio New Zealand says Wiesel has stated in a 31 January Washington civil society briefing that NZ's negotiators will now agree to the clause.
Green Party leader Dr Russel Norman immediately seized on the contradiction, saying that Key would have to explain why his previous statements could no longer be relied upon. He went on to warn that the inclusion of the provisions could affect NZ's ability to enact anti-smoking legislation, place restrictions on foreign ownership, and and Pharmac's independent purchasing choices.
Dr Norman also added that this highlighted the need for the text to be publicly released rather than negotiated in secrecy.
Professor Jane Kelsey has speculated that Key's response indicated that he "did not know what his negotiators were proposing to do when he described investor-state enforcement as 'far-fetched'; or he was lying to the New Zealand public; or he buckled to pressure from the US...to agree." She added that Key needed to be upfront about his exact intentions before the fifth round of negotiations commenced on 14 February in Chile.
Key subsequently said he had never retracted his comments, and that they applied to the possibility of civil suits rather than the inclusion of the provision itself.
The Radio NZ story can be heard here.
20 JANUARY 2011: The Sydney Morning Herald reports that Phillip Morris may be using Australia's shift to implement plain packaging on cigarettes and tobacco as an example of 'extreme and disproportionate' legislation that the TPP should be able to challenge through 'investor-state' provisions.
Australia's Labor government announced last April that cigarettes would have to be sold in plain packaging from mid-2012, which would be a world first.
In a submission on the proposed trade agreement to the US Trade Representative, Philip Morris described the plain-packaging laws as an 'initiative of concern' which would allegedly violate international law and intellectual property rights.
Australian Minister for Trade Craig Emerson has offered no committment either way on the inclusion of investor-state provisions in the TPP, but has indicated that an attempt by any tobacco company to undermine Australian anti-tobacco legislation would be so much 'whistling in the wind'.
Thomas Faunce of the Australian National University has suggested in a paper for the Medical Journal of Australia that in the event of such provisions being included, Australia and other countries could initiated an interpretative declaration limiting their effect on the area of public health. Alternatively, he suggests a clause in the agreement could require that non-discriminatory legislation in the pursuit of public health and safety not be deemed expropriatory or compensable for damages.
10 JANUARY 2011: Shortly before Christmas, seven House Democrats, including six members of the House Ways and Means Committee, wrote an open letter to Barack Obama calling for significant reform to trade investment provisions in the TPP's final text.
Inside US Trade reports that their letter asks that that US exclude an investor-state disputes mechanism from the agreement, or at least attach conditions to the use of such a mechanism by investors.
Those conditions may include:
an 'exhaustion requirement' (firms need to have exhausted local administrative and judicial remedies before pursuing their claim);
an 'authentic investment' requirement (firms who have actively created jobs or made a material contribution to the economy in question may seek protection);
narrower definitions of both 'investment' and 'investor'.
In pushing for an end or a relaxation of investor-dispute mechanisms in US FTAs, the lawmakers point out that neither the US-Australia FTA or the original (pre-NAFTA) US-Canada FTA included them. Additionally, they point to the extraordinary rights such mechanisms grant foreign investors over domestic firms, the risk that existing domestic courts are bypassed and undermined, and the ability of governments to pass health and safety legislation in the public interest.
The letter was signed by Reps Linda Sanchez (D-CA), Lloyd Doggett (D-TX), John Lewis (D-GA), Bill Pascrell (D-NJ), Pete Stark (D-CA), Danny K. Davis (D-IL) and Henry Waxman (D-CA).
20 DECEMBER 2010: The New Zealand media published a series of cables at the weekend indicating covert pressure on pharmaceutical reform by US lobbies, as well as serious doubts by NZ's own trade negotiators about the possible advantages of any US-NZ free trade agreement.
Writing in the Sunday Star-Times, Nicky Hager reports that chief trade negotiator Mark Sinclair privately told a visiting US State Dept official that New Zealand had little to gain from a free-trade agreement. This differs significantly from the accounts of the potential FTA benefits given by Prime Minister John Key and Trade Minister Tim Groser.
According to the cable, detailing a February 2010 meeting, Sinclair told US Deputy Assistant Frankie Reed there was a public perception a US free-trade agreement would be an 'El Dorado' for NZ's commercial sector, but that 'the reality is different' and that NZ must 'manage expectations' about the benefits of such an agreement.
Neither Sinclair nor the NZ government has deigned to comment on the content of the cable, which also warned that negotiations would prove 'gut-wrenching' for New Zealand and criticised member states for 'hanging on to 'little fantasies' about what is acheivable'.
For the US's part, a December 2004 cable reports that the American drug industry has been 'trying in vain to persuade the New Zealand government to change its restrictive pricing policies on pharmaceuticals' and that their new tactic is to reach out directly to NZ consumers to foster demands for 'cutting-edge drugs not covered by government subsidy'. More surprisingly, that cable goes on to say that pharmaceutical companies saw direct opposition in the then-Labour government's Cabinet, particularly in former Primer Minister Helen Clark. It goes on to note that "the industry may be paying a price for its unsuccessful effort in 1990 to unseat Clark, who at the time was health minister".
The full-text cables on Mark Sinclair's meeting with Frankie Reed can be read here and here. An earlier cable in which Groser expresses strong desire for the US to come to the table on TPP is here, warns about 'anti-US' factions of the opposition Labour Party, and indicates his government will handle the public aspect of negotiations in a 'mature' way can be found here.
Professor Jane Kelsey has argued that the leaks indicate comprehensively that the government sees 'no tangible benefits' from a NZ-US free trade deal, and that the government should concede as such to the public. Her press release following these reports can be read below the break.
The TPP Digest is on the lookout for further Cablegate leaks relating to TPP, with all and any actual or prospective members, and will publish them as they become available.
1 OCTOBER 2010: Assistant US Trade Representative Barbara Weisel has welcomed the Philippines interest on joining the TPP, but has warned that doing so will involve 'significant legal reforms', including a strong IP rights system and the near-total opening up of the services sector.
BusinessWorld reports Weisel recognised that TPP commitments may even require the Philippines to undertake constitutional reforms (the constitution presently bars foreign ownership in a number of service sectors), and that the administration of Benigno Aquino III will have to generate 'domestic consensus' to permit such changes to get through.
The Philippine National Economic and Development Authority (NEDA), which would be negotiating any service sector liberalisation, has said full participation in TPP talks will take time because of the present legislative restrictions, and that no negotiation can occur ahead of making these reforms.
Weisel noted financial, telecommunications and computer services as areas of key interest for the US in the Philippines. The original BusinessWorld article follows below.
17 JUNE 2010 - The Christchurch Press in New Zealand has run an op-ed by Council of Trade Unions policy director Bill Rosenberg, which highlights what he sees as the potentially risky areas of the TPP negotiations. He argues that for any final negotiated agreement to be truly '21st century', it must tightly regulate financial services and control the international flow of currency, especially subsequent to the credit crunch. Additionally, he argues that negotiations need to respect the independence of NZ's Pharmac agency as well as its current overseas investment rules. The full article follows below the break.
Senior columnist for the Melbourne Age Kenneth Davidson has written of his general concerns for the repercussions free trade agreements have on domestic democracy and the commodification of labour, while also expressing concern about the secrecy and lack of engagement surrounding the initial round of negotiations. The article can be found online here, or below the break.
MARCH 15, 2010: Barack Obama is due to meet with his Australian counterpart, Kevin Rudd, on March 26. The whirlwind stop in Canberra is likely to cover the by-then complete negotiation rounds in Melbourne for the TPP agreement. While Obama is quick to hail the 'model alliance' between the US and Australia, serious doubts are rising in Rudd's capital about the lack of consultation and analysis going ahead into the negotiations, as an excellently-argued Canberra Times op-ed by Professor Thomas Faunce expresses today...