Beware of the Bilateral Trade Deal

NAFTA Kills Jobs...The trade priorities of President Obama included negotiating the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP). Both were massive agreements, TPP involving 12 countries responsible for 40% of the global economy and TTIP directly encompassing the European Union and United States, but with far reaching consequences for other countries. Both agreements, created in secret and with multiple provisions negatively impacting sustainable agriculture efforts, the climate, human rights, and public health, were the subject of outrage and protests around the world.

The trade landscape has rapidly shifted. Defenders of labor rights, agroecology, and the environment made passing the TPP impossible. TTIP negotiations are also paused. NAFTA, more than two decades of implementation, is suddenly at the center of the trade dialogue.

Though President Trump has vowed to negotiated (and renegotiate) fairer global trade deals, early indications of the direction of this trade agenda are troubling.

Bilateral Trade

Trump has sent signals that many of the new trade deals will be bilateral, that is between the U.S. and one other country. For example, rather than the full TPP, the U.S. may negotiate a bilateral agreement with former TPP partner Japan. Another agreement with Great Britain, itself pulling out of the European Union, may also be in the works. Some reports suggest that NAFTA may be replaced with separate agreements between the U.S. and Canada and the U.S. and Mexico.

While there is nothing wrong with bilateral trade agreements inherently, those of us who were concerned with TTIP and TPP need to be especially vigilant and cautious of this trend. Negotiating several smaller deals could be a way to sneak in truly terrible agreements without much scrutiny. The U.S. is a big economy and may pressure smaller countries to negotiate deals quickly, using early successes to put additional pressure on other countries to sign similar deals.

Multilateral trade deals allow smaller countries to collaborate and combine negotiating power and also allow analysts and activists to spend time focusing on reviewing a single set of terms, rather than keeping up with multiple agreements. Multilateral agreements also bring some diversity of values and political beliefs to the table.

Recent multilateral trade agreements have been terrible, with mechanism like Investor State Dispute Settlement (ISDS)—the provision that allows corporations to sue if local sovereignty or environmental regulations impede profits—which are marks of agreements written by and for corporations. However, a new wave of bilateral agreements may very well be worse if they contain similar or more aggressive provisions. They may also pass with less scrutiny, especially if viewed as less significant than larger agreements. Bilateral agreements are very significant and may set a precedent for other agreements. We must remain vigilant!

Fair Trade

For any and all trade agreements the U.S. enters into, all stakeholders must be at the table. Because many countries are affected by the trade agreements, even when they are not directly involved (the U.S. agreeing to favorable trade terms with Mexico, may for example, negatively impact farmers in Central America growing similar crops), in general that means forming multilateral trade agreements where all trading partners have a voice is necessary. In all cases it means all sectors affected by trade in each participating country have a seat at the table.

Additional basic criteria that must be respected include:

  • Preference should be given to agroecology and food justice; it is not enough to expand the agriculture sector as long as the majority of the sector is characterized by the current industrial model.
  • The climate crisis must be addressed and climate goals must trump other trade goals.
  • People must be prioritized over profits; this means human rights are more important than corporate rights in all areas.

Especially in an era of fragmented and uncertain trade deals, it is important to continually speak up in favor of fair trade deals.

Learn more and take action.

Posted on March 2nd 2017
Kerstin Lindgren

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