Local and national governments may be forced into taking a
free trade approach even when acting on issues in the public interest if the
Transatlantic Trade and Investment Partnership (TTIP) is finalised. This might
have major implications for citizens who will find that decisions about local
services, investment in jobs, and even food safety protection rules are
dictated by the terms agreed under TTIP.
In response, the governments of cities, municipalities and
regions in France, Germany, Austria and other European Union
countries have made statements criticising TTIP or have declared themselves
TTIP-free zones. They are urging national governments, Members of the European
Parliament and European leaders to act in the interests of democracy to block
What does it mean for local decision makers?
Increased pressure for privatisation
In seeking to increase trade between the US and the EU,
TTIP is designed to encourage privatisation of public service provision. This
would open up markets to allow private companies to provide services, including
health care and education. There are also concerns that
once services have been privatised, it could be difficult – and costly – for
governments to bring them back into public ownership, even when private
providers are failing to provide the services required.
Limiting policy choices
The details of the TTIP agreement could severely limit
choices democratically-elected authorities have in key policy areas including
health and safety, food standards, public procurement rules, and state
subsidies. Local governments, for example, may be unable to specify social or
environmental criteria when tendering for services, or to introduce local bans
on GM crops, regardless of public concerns.
The European Committee of the Regions – a body that
represents local authorities in the EU – has
called for special arrangements to be included in
TTIP to ensure that GM products, animals treated with growth hormones and food
from cloned animals can be excluded from the trade deal. They also ask for
special exemptions for locally designated food products, traditional seeds and
crops, and foods treated with substances banned in the EU. Eurocities – a
network bringing together over 130 of Europe's largest cities – stresses in their statement that TTIP
should not lead to a watering down of existing EU and member state standards on
the environment and food and product safety.
Risk of legal challenge to laws in the public interest
The proposal to include an investor-state dispute
Settlement system in TTIP further limits the choices local authorities have to
act. This system privileges foreign companies and could leave local and
national governments exposed to legal action from foreign corporations who
claim their profits have been affected by government decisions.
Cases of this nature under similar trade deals have already cost European governments billions of euro in compensation, and the risk of legal action can be seen to be having a chilling
effect on government decisions.
Limiting public services, limiting public subsidies
TTIP could also limit the ability of national and local
governments to support basic public services, depending on how
"governmental authority" is defined in the trade deal. This could
limit the ability of local governments to organise and finance activities in
the public interest. Subsidies for transport, culture, and even housing could
be at risk.
What does this mean for citizens?
These restrictions on the power of democratically elected
local and national governments will mean that citizens cannot influence
decisions on the nature of the services they receive, or hold democratically
elected representatives to account where there is a failure to provide the
Decisions that affect local services, the local economy
(including jobs, small businesses, and standards) and the local environment will
then all come under the remit of TTIP – reducing questions of local needs,
values and standards to a question of competitiveness and cost.
Citizens would be deprived of their democratic rights to influence public
policy decisions that affect their everyday lives – from the food they eat, to
the health and education services in their area.
Opposition to TTIP from local authorities is just another
reason to stop this Trojan horse of a trade deal that only benefits
multinational corporations, not people or planet.
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