Australia’s trade minister, Steve Ciobo, will sign the revised Trans-Pacific Partnership (TPP) in Chile this week, and preparation Ciobo is stepping-up the spin. From The Australian:
“It’s a comprehensive high-quality deal. The more countries that join, the more momentum it will create, so you effectively get a feedback cycle. That is the intent of the TPP deal”…
“On a sector-by-sector basis, some parts of our agricultural sector will enjoy more competitive and lower levels of tariff, and better access under TPP…
Once signed, the TPP-11 will be examined by parliament’s joint standing committee on treaties, before going to the vote.
Mr Ciobo challenged Labor to support the deal, saying freer trade was responsible for a significant slice of the 403,000 jobs created in Australia last year.
“If they win government, they can seek to renegotiate any aspect they like. But they should not hold to ransom economic growth and future job growth by opposing what is a very good deal,” he said.
Would Labor opposing the TPP really “hold to ransom economic growth and future job growth”?
Late last year, the Peterson Institute for International Economics released modelling showing that the original TPP including the US would have boosted Australia’s national income by $19 billion (0.6%) and lifted exports by another $37 billion by 2030, whereas a TPP without the US would increase national income by 0.5% and exports by $29 billion by 2030.
Given that Australia’s real gross national income has increased on average by 0.9% each quarter since 1959, we are talking about a boost to national income equivalent to only around 1.5 months of output over more than a decade. Whoopdee do.
Moreover, separate modelling by the Global Development and Environment Institute at Tufts University actually found that the TPP (including the US) “would lead to losses in employment and increases in inequality”, with employment in Australia estimated to contract by 39,000 jobs:
There are also several potential costs that are unlikely to have been captured by the TPP modelling. These include Investor-State Dispute Settlement (ISDS) provisions – which would open the door to multinational companies suing the Australian Government for implementing rules against their interests (e.g. on environmental, health and safety grounds) – as well as extensions to patent and copyright protections.
The TPP will also commit Australia to allowing the employment of workers from six new countries – namely Mexico, Chile, Japan, Canada, Malaysia and Vietnam – without requiring them to first check if there is an Australian that could do the same job.
So, effectively Australia’s sovereignty and democracy is being sold down the river for tiny potential economic gains (and possible losses).
In any event, the Productivity Commission has previously called for greater oversight and scrutiny of FTAs before they are signed:
The emerging and growing potential for trade preferences to impose net costs on the community presents a compelling case for the final text of an agreement to be rigorously analysed before signing. Analysis undertaken for the Japan-Australia agreement reveals a wide and concerning gap compared to the Commission’s view of rigorous assessment.
Similarly, a Parliamentary committee slammed the lack of adequate “oversight and scrutiny” pertaining to the original TPP, and lamented that “parliament is faced with an all-or-nothing choice” on whether or not to approve trade agreements and can only officially review trade laws once they have officially passed.
The original TPP was an incredibly complex agreement whose text numbered some 6,000 pages and 30 chapters. It was far too complex for the Joint Standing Committee on Treaties (JSCOT) to comprehensively review and required expert scrutiny from the PC prior to any parliamentary vote to ratify the agreement.
The least the Turnbull Government can do is have the PC scrutinise the TPP for its economy-wide impacts before Parliament votes to ratify the deal.
