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8 April 2016updated 09 Sep 2021 1:13pm

Diane Abbott is wrong about TTIP

The UK's longest-serving MEP responds to the Shadow International Development Secretary.

By David Martin

This article is a response to Diane Abbott’s blog on Monday about TTIP. Read her piece here

Trade deals are huge complicated legal documents which can have a profound impact on a nation and its citizens. Therefore it is all too right that in recent years the public and national politicians have taken a much greater interest in EU trade policy.

As an MEP in Brussels working daily on these issues and the spokesperson for the Socialist and Democrats (S&D) Group on international trade, I welcome Diane Abbott’s newfound interest in the Transatlantic Trade and Investment Partnership (TTIP) agreement with the United States. 

The Shadow Secretary of State for International Development raises some important points about TTIP that need to be addressed. In fact, many of them are already being tackled in the European Parliament by the S&D group, the alliance which contains British Labour MEPs. Not only that, we have achieved concrete results and have made great strides in improving the proposed deal.

Ms Abbott’s concerns can be divided into two key groups: the dangers posed by an unreformed Investor-State Dispute Settlement (ISDS); plus the negative effects that TTIP could have on developing countries.

On ISDS, her article cites cases where governments have been sued by companies. However, if you look a bit more closely into each individual case you will see that many have already been thrown out of court. They are little known but the UK already has around 100 bilateral treaties in force containing ISDS and has never once been successfully sued. In fact, in the vast majority of cases worldwide investors are not successful.

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Nevertheless, ISDS based on secretive private arbitration was clearly unacceptable.

Thanks to strong pressure from our group the European Commission recently came out with a significantly changed proposal which is transparent and will act like other international public courts. Crucially, there is also a guarantee that a government’s right to regulate in the public interest cannot be subject to a bogus claim. In short, ISDS is dead.

With regard to developing countries, it is clear that a deal between the EU and the US will have indirect effects on the rest of the world economy. However, the study that is cited by Ms Abbott was commissioned by the extreme left group within the European Parliament. Another study has suggested that TTIP could bring GDP gains for the world’s least developed economies of around £2bn. This is because by harmonising standards in the two largest economies in the world it becomes easier for exporters from third countries to sell their products in both markets. There would be no unnecessary and costly duplication of testing.

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New generation trade agreements do reach into many more areas of our lives than traditional deals which just offer lower tariffs. As S&D MEPs we will continue to be extra vigilant in protecting our high standards in food and product safety. However, it also must be said that these new-style trade deals also have very strong chapters on workers’ rights and the environment, which can have important positive knock-on effects for the developing world.

Despite our sometimes jarring differences (see Donald Trump), the US and the EU share the core values of democracy and rule of law, as well as both guaranteeing high standards for their citizens. By together setting the trade rules for the future we can ensure that these values are upheld in a global context. If we don’t do it now then the emerging powers of the future won’t waste time in applying their own rules – rules that definitely won’t be so progressive.

Finally, it is worth remembering that the European Parliament has a veto over any trade deal which it thinks does not sufficiently protect the environment and workers’ rights in both the EU and developing countries.
As with the Anti-Counterfeiting Trade Agreement (ACTA), for which I was Rapporteur, the Parliament has shown in the past that it is not afraid to sink a huge deal which doesn’t match up to our high standards. A bad TTIP deal would certainly meet the same fate.

David Martin has been a Labour MEP for Scotland since 1984 and is currently spokesperson for international trade for the Social and Democratic (S&D) Group in the European Parliament. He tweets @davidmartinmep