Three principles to reshape trade and investment to overcome the crisis

FRENCH | GERMAN | SPANISH | GREEK

In less than half a year, the coronavirus pandemic has fundamentally reshuffled the cards of economic globalisation. Complex supply chains, the international division of labour, and just-in-time operations have grown over the past thirty years. Their dysfunctionalities are now a source of crisis, not resilience. 

The pandemic brings into stark relief the underlying structural vulnerabilities the economic system has generated for people and the planet.  Instead of helping us overcome the pandemic, the neoliberal trade and investment regime has made it harder to respond to this crisis, given our dependence on large and unstable globalised production chains.  

This problem was exemplified in the case of personal protective equipment (PPE), which was produced in only in a few countries, and was not available where and when it was most needed. Efforts to develop a vaccine are complicated by intellectual property rights that ensure huge profits to pharmaceutical corporations while the cost is paid for with taxpayer money. Many emergency measures taken by governments to protect public health during the pandemic risk coming into conflict with the global investment protection regime. As a result, governments around the world could face a new wave of costly Investor-State-Dispute-Settlement (ISDS) cases. 

The pandemic is particularly severe for vulnerable parts of the population. People in the Global South are hit exceptionally hard, as they are already suffering from the dirty practices of multinational corporations, unpayable debt burdens and the consequences of a climate change they haven´t caused. In fact, climate change will be further exacerbated if government economic policies do not fundamentally change course. We are concerned that the European Union and its member states continue to push for more neoliberal trade and investment agreements, such as the recently concluded EU- Mexico agreement or the heavily criticised EU-Mercosur agreement. Now is the time to step back and re-evaluate our trade regime rather than continuing on the same unsustainable path that has continuously failed us. 

In 2013, over 50 civil society organisations put forward the Alternative Trade Mandate in a call to change the international trade system and the EU’s trade and investment policy. Since then, the climate and ecological crises have dramatically worsened and inequality has further increased. Today, in the midst of a world-wide pandemic, the call for the alternative mandate is more urgent than ever. In many countries, popular support for deepening liberalisation is waning as people experience its negative impacts both personally and on society and the planet. We need immediate structural change.

The Seattle to Brussels Network believes the following three principles should guide the EU response to the multiple crises we are currently confronted with:

Principle I: Stop and reset the current trade and investment regime

Covid-19 is not just a health crisis. The pandemic is laying bare the systemic deficiencies that fed the various crises we have been facing for years. Trade and investment agreements, whether in bilateral deals or within the World Trade Organization, have played a huge part by weakening public sectors, by liberalising them and fostering their privatisation. Supply chains have grown longer, more complex,  and less transparent. Production of crucial goods, such as pharmaceutical and medical equipment, has been outsourced to private companies. At the same time, dispositions in trade and investment agreements have fixed the position of countries in the Global South as suppliers of raw materials, hampering their economic diversification, and increasing their dependence on imports from industrialised countries. Increasing international trade flows has taken precedence over the protection of human rights and the planet. We therefore call to: 

  • End all existing neoliberal trade and investment agreements and start a process of replacing them with agreements that create a sustainable, climate-friendly, environmentally protective, human, and labour rights-oriented model of world trade. 
  • Stop all ongoing trade and investment negotiations: halt the negotiation, signature, and ratification of new bilateral neoliberal trade and investment agreements.
  • End all WTO agreements that require and enforce the patenting of medicine and seeds. 
  • Restructure all international trade institutions to give priority to climate protection, a healthy environment, human rights, resilient, sustainable economies, and a stronger voice to the Global South. 
  • Ensure that new trade rules never harm the right to regulate and do not hinder the precautionary principle to protect public health and the environment. 

Principle II: End corporate privileges and stop corporate impunity 

The current neoliberal trade and investment regime severely curtails our democracies. The kinds of emergency measures taken by governments in the health crisis could be challenged under the rules of the current regime of investment protection. The Investor-State-Dispute-Settlement mechanism (ISDS), part of many bilateral investment treaties, allows transnational corporations to sue countries for democratic decisions that might harm corporate profits. ISDS is extremely costly for the public and often means that governments abstain from necessary measures for fear of the potential costs. Measures to address the climate and environmental crises, including the phasing out fossil fuels are the most targeted.   

We must establish a global order that does not make societies pay for taking democratic decisions. While our democracies are undermined by a system of investment treaties, it is almost impossible to hold corporations accountable for the human and environmental rights abuses they commit in their search for ever higher profits. Democratic decisions and human rights must prevail over private interests, and transnational corporations impunity must be dismantled:

  • End ISDS and stop honoring ISDS awards. After having hit the benchmark of more than 1000 ISDS claims – which until the end of 2018 led to more than US$88 billion in compensation payment from states to private investors – it is time to stop this system which ONLY benefits corporate interests to the detriment of people’s well-being and the environment. Instead of giving more rights and money to corporations, we need money to transform our local economies and (health) care systems.
  • Establish a binding treaty on business and human rights at the international level and corporate accountability legislation at the national and European levels in order to hold corporations accountable when they violate human, social and environmental rights. These legal instruments must contain sanction mechanisms to make them effectively enforceable and include the entire supply chain.

Principle III: Ecological and social relocalisation and cooperation instead of neoliberal globalisation and competition

Rather than pursuing the unsustainable neoliberal world market and the xenophobic and  nationalist measures taken by more and more governments, we should choose another path: that of ecological and social relocalisation, built on strong international solidarity. The aim is not to repatriate a few strategic factories, but to put people’s needs first by rebuilding our economies rooted on the local level in good social and ecological conditions. 

This requires restoring the capacity of States, local authorities, and populations to have the legislative, legal, fiscal, and economic means to decide their needs and how to provide for them. Additionally, we need to fundamentally restructure  trade and investment rules and institutions to protect basic needs (health, housing, education, access to water, energy and food). These priorities must inform decisions on preference for local suppliers.  Relocalisation does not mean giving up international trade that is based on complementarity, cooperation, and solidarity. 

This means: 

  • Relocalisation and socialisation of production of goods as much as possible and where environmentally logical, while supporting countries in the Global South to develop their own food and industrial production. This can increase global resilience to internal and external shocks. In particular, the production of essential goods needed on a daily basis, as well as products needed to ensure high-quality public services, must be produced as locally as possible or at least within the macro-regions and based on strong adherence to social and labour rights. 
  • Allowing public authorities and the people to regulate and exclude strategic sectors from trade rules, which should give priority to basic needs and resilient and sustainable jobs. This also means allowing authorities to include preferences for local suppliers in their public procurement policies.  Giving local authorities the right to decide for themselves will enable public procurement to become a powerful tool to support relocalised economies according to our needs. 
  • Socialisation and re-municipalisation of public services. Good and strong public services, especially public health systems, cannot be managed under the logic of profit maximisation. Trade and Investment agreements must exclude all public services and grant people the full right to organise services democratically.
  • End irrational unnecessary trade and establish complementarity Redundant trade, meaning exchanging the same goods between countries, as well as shipping food to other countries for processing and then re-importing (peeled shrimps, frozen potatoes…) is killing the climate and needs to stop. We need to establish the principle of complementarity that prevents imports from afar of what can be produced locally, based on the principles of food sovereignty, solidarity and sustainability.
  • Strengthening local agroecological systems that protect climate and biodiversity. Industrialised agriculture based on deforestation, monocultures, genetically modified seeds and huge quantities of pesticides and fertilizers needs to end. It destroys the livelihoods of people, animals and plants and facilitates outbreaks of viruses like Covid-19. 
    Trade policy must prioritize local agroecological systems based on strong social and labour rights. 

Signing Organisations:

ACCION ECOLOGICAEcuador
Africa Europe Faith & Justice NetworkEurope
AitecFrance
Allianz gerechter HandelAustria
alofa tuvaluFrance
Amigas de la TierraSpain
Amis de la Terre FranceFrance
Anders HandelnAustria
association traits portraits France 
AttacAustria
ATTAC ArgentinaArgentina
Attac AustriaAustria
ATTAC ESPAÑAEspaña
Attac FranceFrance
Attac IrelandIreland
ATTAC SwitzerlandSwitzerland
AUGE/UG – Alternative, Grüne und Unabhängige GewerkschafterInnenAustria
Berliner WassertischGermany
BLOOMFrance
CADTM FranceFrance
Campaña No a los Tratados de Comercio e InversiónSpain
Campanya Catalunya No als Tractats de Comerç i InversióSpain
CCFD-Terre SolidaireFrance
Center for Encounter and Active Non-violenceAustria
Centre for Research on Multinational Corporations (SOMO)Netherlands
Centro de Documentación en Derechos Humanos “Segundo Montes Mozo SJ” (CSMM)Ecuador
Centro de Estudios HeñóiParaguay
ClimáximoPortugal
Collectif Arcois pour la Planète France
Collectif Stop CETA/MercosurFrance
Comité de solidarité avec les Indiens des Amériques (CSIA-Nitassinan)France
Comité Pauvreté et PolitiqueFrance
Confederation paysanneFrance
Corporate Europe Observatory (CEO)Belgium
Corporations.Zero TolerancePortugal
Ecologistas en AcciónEspaña
Emmaüs InternationalFrance (headquarters)
Enginyeria Sense FronteresSpain
European Network Oscar Romero CommiteesBelgium
FairwatchItaly
Fédération Artisans du MondeFrance
FIAN DeutschlandGermany
FISYPArgentina
Food & Water Action EuropeBelgium
Forum Umwelt und EntwicklungGermany
France Amérique Latine (FAL)France
France Nature EnvironnementFrance
Friends of the Earth EuropeEuropean Union
Fundación SolónBolivia
Global AktionDenmark
Global Justice NowUnited Kingdom
Grüne Bildungswerkstatt NÖAustria
Handel Anders! coalitieNetherlands
Institute for Agriculture and Trade Policy (IATP)Europe
Institute for Policy Studies, Global Economy ProjectUnited States 
Internationaler VersöhnungsbundAustria
Katholische ArbeitnehmerInnen Bewegung ÖsterreichAustria
Kölner Bündnis für gerechten WelthandelGermany
Les Jardins Saint Michel sprlBelgium
Local FuturesInternational
Maison des Citoyens du MondeFrance
Mouvement d’Action Paysanne (MAP)Belgium
Naturefriends GreeceGreece
NaturFreunde DeutschlandsDeutschland
NOAH Friends of the Earth DenmarkDenmark
OIKOPOLISGreece
PEPS Pour une Écologie Populaire et Sociale France 
Plataforma América Latina mejor sin TLCAmérica Latina
Platform Aarde Boer ConsumentNetherlands
PowerShift e.V.Deutschland
Private individualSpain
Proge unionAustria 
Revoluciona o MundoPortugal
SherpaFrance
SOL – Menschen für Solidarität, Ökologie und LebensstilAustria
SOS RacismoPortugal
Stop TTIP/CETA Italia CampaignItaly
Touche pas à mon schiste France
transform!atAustria
Transnational InstituteNetherlands
TROCA- Plataforma por um Comércio Internacional JustoPortugal
TTIP Network FinlandFinland
Union syndicale SolidairesFrance
Voedsel Anders NLNetherlands
Werkstatt ÖkonomieGermany
WIDE – Network for women´s rights and feminist perspectives in developmentAustria
WSMBelgium
ZenVougaPortugal
ZERO – Association for the Sustainability of the Earth SystemPortugal