EU Trade Day: Is trade about our values or “zombie deals”?

EU TRADE DAY: Do trade agreements represent the forward march of “EU values” or are they “zombie deals” against the public interest?

EU Trade Day #EutradeDay took place on June 23rd organized by the Directorate General of Trade of the European Commission and attended by over 500 representatives of businesses, NGO´s, consumers and trade-unions. There was a plenary session led by EC Trade Commissioner Cecelia Malmstrom and ten parallel break-out sessions that covered many diverse issues. Commisioner Malmstrom said that trade was one of the key ways the EU extends its social, economic and environmental values around the world and that these agreements should be carried out with a “bottom-up” approach with the wide participation of civil society. One of the main objectives of the day was to collect ideas for the EU´s new Trade Strategy that will be published in October of this year. (See BEUC position: http://www.beuc.org/publications/beuc-x-2015-060_consumers_at_the_heart_of_trade_policy.pdf )

The General Secretary of the Trade Union Council Francis O’Grady broke the ice by flatly stating that “zombie trade deals that are not in the public interest should be rejected” and concretely on the ISDS debate: “”The row in the European Parliament over foreign investor privileges in the EU-US trade deal proves that old-style Investor State Dispute Settlement is dead – no one supports it any more, on the left, on the right or in the Commission. And yet, zombie-like, it lives on in the Canada- EU deal, unreformed, unamended, and unacceptable.”

On the other side, the Eurochambre business representative and other industry leaders at the session on “How trade affects peoples lives”, insisted that “international trade has always been an important driver of progress by creating jobs, by benefitting EU companies and through promoting economic development in South.” Business Europe was convinced that “China has an increasing portion of world trade and as result is experiencing more evolution, more innovation and more competition.” Little mention was made by these representatives of how trade affects peoples lives.

French economist Messerlin stated that the “EU made a big mistake by putting talks over regulations under a trade agreement as opposed to direct ongoing transatlantic talks between regulators of US and EU”. He also said that many economists have doubts about including intellectual property protection in trade agreements because this means granting new temporary economic monopolies. He insisted that one thing was open trade and something else was regulatory harmonization, much of which will never happen between the US and the EU. One civil society attendee summed it up: “Today I learned that international trade is not about international trade.”

Many speakers voiced opposition to higher regulatory standards in trade agreements with countries of South because it would make it harder for them to compete on the world market. Many industry and Commission representatives referred to the trickle-down effect of international trade that ends up benefitting the majority by creating jobs.

Concern was expressed by some experts and Ngos of the possible regulatory chill effect trade agreements can have on public health measures to assure access to medicines, food safety and protection from toxic chemicals. In the case of locking in the high price of medicines the representative of Merck Pharmaceuticals responded that the principal problem was the lack of infrastructures and hospitals and not the high price of medicines often backed by rules included in trade agreements.

A number of civil society representatives and experts complained that while the purely economic aspects of international trade agreements and WTO rules had binding mechanisms for compliance while consumer rights, public health, environment and labour rights did not have equivalent enforcement measures.

In general, while many in the European Commission and industry representatives stated that the promotion of trade is usually a win-win situation in which the common good in health, environment and consumer rights are benefitted by expected economic growth and more jobs, there was also great concern among many citizens organizations that large economic interests influencing trade can easily trump greater public interest objectives.

EU Trade Day is the latest in a series of participatory events on trade as part of the recent “charm offensive” to show that the EU wants truly “bottom-up” approach to trade. But it still remains to be seen if civil society opinions will be decisive in the future of EU international trade negotiations and agreements.

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