Asia-Europe People’s Forum (AEPF) Conference

“21st Century Trade and Investment Policies: Challenges and Implications

on Sustainable Land and Natural Resources Management in Asia and Europe”

 Jakarta,  29-30 January 2015

Opening Remarks

By Tina Ebro

On behalf of the AEPF International Organizing Committee, a warm welcome! Our many thanks that you can come and share your valuable contributions today and tomorrow. Much thanks, too, to the Indonesian Global Justice (IGJ)  and the committee of movements and NGOs that organized this event with the AEPF International Organizing Committee.

Recently, friends in France described the AEPF as a precious vehicle that links progressive Asian and European movements -  movements that work persistently  for a just, participatory and sustainable world. They said AEPF has opened dynamic networks on major issues, and keeps the links between these organizations alive. So there is a campaign network for just trade and against the European Union’s FTA with the ASEAN, a campaign network for transformative social protection in Asia, an Asia-Europe peace and security network, and projects on water justice, no-nukes, and alternative regionalism.

AEPF has organized every two years People’s Forums or civil society summits prior to the ASEM Summit. Thus in Milan, last October over 400 participants from 42 countries joined together – representatives of networks and NGOs, scholars and academicians, progressive parliamentarians and policy makers – under the theme  “Towards a Just and Inclusive Asia and Europe: Challenging Unjust and Unequal Development, Building States of Citizens for Citizens”. The gathering tackled major issues of Just Trade and Investment, Transformative Social Protection, Climate Justice, Peace and Security, Food Sovereignty and Sustainable Land and Natural Resource Management. 

This conference is in fact a follow-through activity to the discussions in Milan particularly on the new generation trade and investment agreements and their impact on land and natural resources, and on the peasantry and rural communities. At the plenary and workshops, eminent thinkers and powerful grassroots representatives have highlighted the following  major points that may serve as underpinnings  to our discussions here:

That the peasantry - composed of small farmers, landless peasants, fisher folk, indigenous peoples – constitute nearly 50 percent of the world’s population of 7 billion. They feed the world,  serve as stewards of natural resources, and safe-guard the future sustainability of agricultural systems. But they are  under threat.

Under threat, too, are the commons of humankind - the land, forests, water, oceans and other natural resources that have been privatized, commodified and controlled by corporate power and the elite.  These commons are the life, livelihoods and future of one-half of  humanity .  

Our resource persons have stressed  as well   that the World  Banks’s and International Monetary Fund’s imposition of structural adjustment or neoliberal policies in the 80s and 90s, crippled the agricultural capacities of most developing countries and dispossessed millions of peasants of their land and livelihoods. Therefore we can link the dispossession of the peasantry with the rise of widespread structural unemployment and the dramatic rise of the precariat or labour  in the informal sector.

Trapped in precarious temporary work in hostile conditions the precariat compose about 2/3 of the working people in Asia.

Scholars in Milan have shared that the violations of peasants' rights will mount in this millennium by the  adoption of more aggressive trade and investment policies like the TTIP and TPP which call for the highest form of   liberalization,  deregulation and privatization of public goods and services. Protective regulations will be further removed that safeguard labour, consumers and the environment. These Free Trade Agreements (FTA) will have devastating effects in the countryside - on people’s lives and livelihoods, on the sustainability of  land and natural resources.

So we hope that our discussions here will deepen our understanding and analysis  of these challenges and we can identify alternative and viable proposals that we can forward to the ASEM, EU, SAARC and ASEAN heads of states and officials. We are aware that these regional blocs have been designed as bigger markets and richer sites of exploitation. That is why civil society engagement with these bodies is important to expose and derail these processes such as these FTAs that only serve the agenda of corporate power.

It is also imperative in the region to wage an advocacy for a Peoples Social Agenda for a Life of Dignity.  The ASEAN Economic Community will be launched at the end of this year, and the blueprint for regional integration  is open regionalism, which will be cemented by FTAs.  

Therefore let me close and stress that our solutions and alternatives need to go beyond the logic of endless growth and this profit-driven paradigm which is the basis of the capitalist system.  In fact our struggles - across countries and across regions - that fight for agrarian justice, for just trade, for climate and environmental justice, offer the momentum to overhaul and transform this political and economic system.

This system has engendered an unprecedented crisis of inequality in our time - illustrated by 80 individuals controlling about 48 percent of the world’s resources. Oxfam said these billionaires or trillionaires can even fit in a bus! This system has engendered as well an urgent climate crisis, and a lingering economic crisis with no end in sight.  So more than ever, we need  a new system that would reverse  the destruction of our earth and all life in it. We need a new system that would restore humanity’s relationship  with nature and solidarity among peoples.

[Tina Ebro is active in Coordinating Team of the Asia-Europe People’s Forum (AEPF), and in the Facilitating Team of the Network for Transformative Social Protection (NTSP).]

 

The AEPF will hold a thematic dialogue on natural resources with theme “21st Century Trade and Investment Policies:  Challenges and Implications on Land and Natural Resources in Asia and Europe” in Ambhara Hotel Jakarta, Indonesia on  29-30th  January 2015.

 

The dialogue forum will present and discuss  the dynamics of investment cooperation in Asia and Europe regions, particularly on land and natural resources, and for the civil society to be able to participate and contribute more meaningfully in dialogues.

The event will be participated by social movements, academe, and parliamentarians from 21 European and Asian

countries.

An opportunity to set a new standard

China and the EU are preparing to launch negotiations for a bilateral investment agreement at the next EU-China Summit this November. The proposed agreement would replace existing bilateral investment treaties between EU member states and China. This is the moment to develop a more balanced international investment framework that would protect the sovereign power of both parties.

The current international framework for investment protection is increasingly perceived as a threat to national sovereignty and the protection of the rights and values of citizens. The risks associated with the dispute settlement clauses commonly included in these agreements are sparking an ever more urgent debate on a need for alternatives.

Dispute settlement in investment agreements typically enables foreign investors to unilaterally sue host governments behind closed doors before a triumvirate of arbitrators. ISDS allows foreign investors to challenge the laws and regulations enacted by sovereign governments by bypassing national courts. ISDS provides foreign investors with an option to go straight to an international arbitration process that carries an inherent bias in favour of the investors. The arbitrators are generally commercial lawyers or academics who make money out of these arbitrations, which can only be brought by foreign investors.

At the same time, the broad phrasing of the protections in investment agreements allow foreign investors to challenge almost any government measure that might impinge negatively on their projected profits. The clause guaranteeing the foreign investor a ‘fair and equitable’ treatment is particularly controversial because it can be stretched by the investor and the arbitrators to cover almost anything. Investment agreements also stipulate that foreign investors must be compensated for any kind of expropriation. Investment tribunals on various occasions have interpreted general public interest measures as indirect expropriations warranting compensation to the investor. Investors can challenge regulations from public authorities at all levels if they feel these may negatively affect their profitability.

Through the investor-state dispute settlement (ISDS) mechanisms, investment agreements can have a serious impact on policy space. Awards for damages can easily run into hundreds of millions of dollars, payable out of public budgets. And even if the state wins a dispute case, this is still a costly affair due to the costs of the arbitration and legal representation.

The Chinese audience may be aware of the investment dispute initiated by Chinese insurer Ping An initiated against the state of Belgium to claim compensation over damages arising from Belgium´s nationalization of Fortis Bank. It may thus look upon ISDS as a convenient tool to protect the interest of Chinese investors abroad. But if, as the EU wants, market access is included in the proposed investment agreement, China can also expect much more incoming investment from Europe, with European investors able to invoke the protections of the agreement and initiating cases against China if their investments are threatened.

International law firms, who discovered the opportunities of ISDS in the 1990s and are making big money out of dispute settlement cases, are actively raising awareness of the possibilities of investment arbitration with international investors and pushing them to file claims. The number of known investment cases has increased exponentially to arrive at a staggering 514 in 2012 – a number which probably only symbolizes the tip of an iceberg, as there is no obligation to publicly register an investment case, except for those brought before ICSID, the dispute settlement body of the World Bank.

China has already been at the receiving end of a number of WTO complaints, including over its raw materials policy. Without question, policies to boost domestic industries and reserve raw materials for domestic producers would also be challenged under an investment agreement, potentially leading to substantial and deep-cutting damages awards. ‘National treatment’ clauses typically included in investment agreements do not allow for this kind of ‘discrimination’ of foreign investors. An investment agreement would likely impact on other areas of policy-making as well. For example, environmental pollution is emerging as a major problem in China. But should China wish to introduce stricter environmental regulation, an EU-China investment deal would enable European investors to claim compensation if those new rules impinge in any way on their profit expectations.

Similarly, China’s ambition to build up a social welfare system will take time and require reregulation – which may be challenged by foreign investors. Multi-billion dollar compensation suits can be powerful lever to persuade governments to amend or abandon proposed legislation. Foreign investors can use ISDS to change regulations in the way that they want, instead of in the way the public interest, now and in the future, may require. And as investment treaties generally have a life span of decades, there are few exit options once an agreement is ratified.

A growing number of countries around the world feel the current framework for investment protection as a straightjacket, which is increasingly constraining their sovereign power to regulate. And resistance is mounting. Ecuador has recently announced an audit of its bilateral investment agreements because of their bias favouring multinational corporations, Australia has decided to no longer include ISDS in future investment agreements and countries like Canada are seeking to tighten up the legal phrasing of investment protection agreements to avoid overly wide interpretation of their protections by investment tribunals. Faced with a growing number of claims, India has decided to revisit its BITs, while Brazil has always categorically refused to implement any BITs.

South Africa, in a recent review of its BITs, concluded that their added value in attracting foreign investment was at best ambiguous, while their undermining effect on decision-making was significant. South Africa also expressed its concerns about standard BIT clauses on the free and unrestricted transfer of funds, as the current global economic crisis has highlighted the potentially destabilising effects of unrestricted capital movements.

In response to the growing critique, UNCTAD released an Investment Policy Framework for Sustainable Development (IPFSD), aimed at helping policy makers to connect the investment policy framework to domestic development policies and to ensure that investment supports sustainable development and inclusiveness objectives. Another alternative framework aimed at balancing investor rights with investor responsibilities is the Model International Agreement on Investment for Sustainable Development of the International Institute for Sustainable Development.

China would be wise to take note of proposals to reform the current investment protection framework by tightening up the legal phrasing and excluding ISDS before entering negotiations to liberalise its investment policy with the EU. China, as a key economic player, might set its ambition beyond merely seeking integration into existing investment protection standards. As civil society organisations, we call on both parties to seek out avenues to advance a new model that addresses the substantial problems associated with the current system for investment protection.

 

TNI is a member of the S2B network, which includes development, environment, human rights, women and farmers organisations, trade unions, social movements as well as research institutes form all over Europe.

Photo of Chinese money by Kevin Dooley

eu-asian-ftaTo the Senate Committee on Foreign Relations

23 February 2012

Position Paper of the EU-Asean FTA Network on the Double Taxation Agreements signed by the Philippine Government with the governments of Kuwait, Qatar, Sri Lanka and Turkey and submitted to the Senate for Ratification

The EU-Asean FTA Campaign Network-Philippines is network of NGOs and social movements monitoring negotiations for free trade agreements between the European Union and Asean Member States as well as global and regional trade and investment policies and their implications on the Philippines.

The network submits this position paper to the Senate Committee on Foreign Relations with regard to the ratification process of agreements/conventions on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income  (double taxation treaties or DTTs) signed by the Philippine Government with the governments of Kuwait, Qatar, Sri Lanka and Turkey.

MeTA cfhat eu-asian-fta
 

(A Joint Position Paper on bilateral free trade agreements and their impact on the right to health and access to affordable medicines published by the Medicines Transparency Alliance (MeTA) Philippines, Inc., Coalition for Health Advocacy and Transparency (CHAT) and the EU-ASEAN FTA Campaign Network,  October 2011)

ACCESS TO MEDICINES IN THE PHILIPPINES:  SOME STATISTICS

The Philippines is a lower middle income country where total health expenditures (THE) account for only 3.7% of Gross Domestic Product (GDP). Filipino households bear the heaviest burden in terms of spending for their health needs, with private out-of-pocket (OOP) expenditures reaching 56% of THE. (Philippine National Health Accounts, 2006)

(In order to move towards universal coverage, the World Health Organization (WHO) believes that countries would need to spend 4-5% of GDP on health, and keep OOP expenditures below 30-40% of THE.)

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