Australia and the Trans-Pacific Partnership

By Stephanie Murphy

This article is part of our July focus on “Australia in the World”. Click here for more articles in this issue.

By Stephanie Murphy

The Trans-Pacific Partnership (TPP) is likely to become one of the world’s most significant free trade deals. But while Australia is one of the major parties, Australians could be excused for drawing a blank on the name.

The high stakes negotiations have been under way for more than three years. This isn’t unusual. But the secrecy is.

The Department of Foreign Affairs and Trade (DFAT) website confirms Australia’s involvement followed an “extensive public consultation process” in 2008. But beyond an assurance that this process will “inform” the Government’s priorities, there is little substantive information.

The stated aim of the talks has been to eliminate or substantially reduce trade barriers – but no draft text has been officially released, governments have been largely silent about the content of the talks, and the trickle of information from various leaked drafts has civil society groups worried.

A sweeping regional agreement, cloaked in secrecy

The US-led talks have been quietly continuing since 2010. There are currently twelve parties: the US, Australia, Canada, Mexico, Peru, Chile, New Zealand, Vietnam, Malaysia, Singapore, Brunei, and the recently-added Japan.

The agreement is billed by governments as a solution to the tangled and unwieldy system of bilateral trade agreements in the region, as well as an opportunity for Australia to negotiate more favourable terms with a number of important partners.

Progress has been laborious – talks are in their 18th round. But Japan’s entrance is significant. It is the world’s third-largest economy, and a pivotal element of regional supply chains. The TPP now encompasses two of the world’s largest economies, and will account for nearly 40 per cent of global economic output.

Membership is expected to increase, possibly to all 21 APEC countries. And the Chinese government has recently announced that it too is studying the possibility of joining the talks.

The TPP’s overarching goal is the elimination of tariffs and other barriers to goods, services, trade and investment, which will purportedly create new opportunities for economies, workers, businesses and consumers.

But protests have been mounting over the deal, not least because of the exceptional secrecy surrounding the negotiations. Civil society groups have largely been kept out of the talks – though they note that hundreds of corporations and lobbyists have been given wide-ranging access.

Unprecedented corporate power

A widely circulated article calls the deal a “wish list of the 1 per cent”, which will grant extraordinary power to corporations, and severely weaken the ability of domestic governments to regulate their activities. And all while citizens are kept in the dark.

The proposed “investor-state” dispute resolution mechanism is one of the most criticised provisions. The proposal would create a private tribunal to resolve disputes between investors – like transnational corporations – and states.

Existing tribunals along these lines are noted for their perceived bias and unaccountability – and there is no indication the TPP would be any different.

Indeed, critics say it will create an entirely unaccountable “parallel system of justice” that hands corporations the power to circumvent domestic courts and sue governments over public health, labour or environmental legislation that is not to their liking. They worry this detail may have been ignored by governments keen to secure trade gains.

Public health concerns

Other leaks have ignited fears that public health policy will be shaped by regulatory changes made under the guise of trade policy. Most notably, schemes like the Pharmaceutical Benefits Scheme (PBS) could be severely undermined.

Commentators say draft texts seem aimed directly at the Australian PBS and New Zealand equivalent – they would lower patentability standards, making it easier for pharmaceutical companies to obtain patents and extend monopolies for existing ones; water down safeguards against patent abuse; and create “back door monopolies” by granting exclusive controls over clinical trial data needed to approve generic drugs.

These factors are likely to drive up the price of PBS medicines. But the impact of such measures could be felt most acutely beyond Australia. In developing countries, access to treatment for diseases including tuberculosis, malaria and HIV/AIDS is contingent on the availability of affordable generic medicines.

According to Médecins Sans Frontières, the intellectual property provisions of the TPP threaten to “cut the lifeline that generic drugs provide” for millions of people – as well as creating a damaging precedent for future trade agreements.

Internet freedom 

In August 2012, the American Civil Liberties Union called the TPP “the biggest threat to internet freedom you’ve probably never heard of”.

The comment goes to the heart of concerns about the TPP: an expansive agreement, negotiated in secret, with a potentially vast but almost completely unknown impact on citizens’ lives.

The main issue for internet freedom advocates is an intellectual property proposal that would hold Internet Service Providers (ISPs) responsible for online copyright violations.

As Angela Daly of Electronic Frontiers Australia explained, it would inaugurate potentially wide-ranging monitoring of internet use – leading to fears of mass surveillance, which have only been sharpened by recent revelations about the PRISM surveillance program and other privacy breaches in the US.

Where to now?

The next meetings are to be held in Malaysia from 15 to 25 July, and the process is slated to finish at the end of the year. While many trade experts expect talks to stretch into 2014, the US government has recently reiterated its commitment to reaching a deal.

Years of relative obscurity have allowed negotiators and governments an almost free rein. Nevertheless, there are signs that the talks will not escape public scrutiny indefinitely.

Civil society opposition has been building in the US, Australia and elsewhere. Groups as varied as religious social justice councils, the Australian Conservation Foundation and unions have all expressed their concerns. With a federal election around the corner, the TPP may yet burst onto the public stage.

The Australian and New Zealand governments have been at pains to assure voters that crucial public health and other regulations are not “for sale”. But given the vast power imbalance between the US and other countries, stakeholders may be forgiven for holding out some scepticism.

Either way, the final agreement will shape more than just trade policy for decades to come.

 Stephanie Murphy is a law student at the University of Melbourne.