Content Contributor, Paht Satjipanon
What is the TPPA?
The Trans-Pacific Partnership Agreement (TPPA) is a free trade agreement that intends to liberalise trade and investment between 12 Pacific Rim countries. After seven years of negotiations, the bill was passed with 62 votes to 59, and was signed on 4 February 2016.
The TPPA covers a region encompassing 40% of the global GDP and has been brought up as a concern that it could fail to protect New Zealand sovereignty and democracy and would hinder the traditional bipartisan political approach to free trade in New Zealand.
But just how far along have we progressed with incorporating this agreement into domestic law? At present, the just the first reading of the Bill was passed.
The lowdown on the first reading
Trade Minister Todd McClay welcomed the first reading of the bill and presented it as an opportunity to maximise exportation in New Zealand by removing trade barriers. After failures to pursue global free trade agreements by previous New Zealand governments, McClay claimed the signing of the bill would allow the growth of prosperity and economy for the benefit of all New Zealanders. Conversely, the minority view of the Green Party as stated by Dr. Kennedy Graham argued the government had adopted the wrong criteria for judging the nationalist interest of the TPPA.
In terms of procedure, discussion during the first reading did not take into account whether the TPPA should be passed in spite of indications of opposition from the New Zealand public.
On a positive note, it was stated during the first reading that the TPPA will not prevent the Crown from meeting its obligations to Maori. It was said that the agreement includes a provision preserving the importance of the Treaty of Waitangi within New Zealand. Furthermore, the Waitangi Tribunal itself released a report a week prior to the first reading, stating that they found no breach of the Treaty within the agreement.
The focus of the first reading however, revolved around the removal of trade barriers, and that itself was only debated broadly. While it is to be expected that the focus of discussion surrounding a free trade agreement would be the issue of trade barriers, there are many other concerns surrounding this agreement (noted below) which arguably demanded more attention.
In summation, the first reading was undoubtedly rushed. This becomes more of an issue when all countries who have signed have confirmed that the agreement will not be open to renegotiation.
Besides these procedural issues, just what is so bad about the TPPA?
Potential for New Zealand to be sued
- Historically, free trade agreements involving the US have not necessarily economically benefited other countries than the US itself. This also opens up the possibility of corporations suing the New Zealand Government, if a deal was not correctly upheld. Canada had signed the North American Free Trade Agreement (NAFTA) and was the fifth most sued country in the world in Investor-state dispute settlements (ISDS), having never won any case against US investors. If a fast track authority system was implemented, the US government would be able to negotiate deals that would require the TPPA always being picked by Congress.
- The signing of the TPPA could have allowed foreign investors to sue the government to prevent progressive environmental reforms even if there is inclusion of a Treaty clause.
- The Library and Information Association of New Zealand Aotearoa feared implications of the TPPA and its overall effects on copyright law. A re-introduction of a ban on parallel importation and changes in copyright law would favour copyright owners at the expense of users of in-copyright works.
Drugs and medicine
- The TPPA states principles for increased transparency in pharmaceutical purchasing. With the US being invested in protecting its intellectual property, there will likely be pressure on New Zealand to review the way drugs and medicine are sold through agencies such as PHARMAC.
New Zealand’s independence
- The Bill was set out as a free trade document, however, this is contradicted by its approval of partial economic integration with provision investment, land ownership and public health policies that would threaten national legislature.