Fast Track and TPP Bad for Development

By Oxfam

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Oxfam America warned today that the Administration’s trade agenda – focused on concluding the Trans-Pacific Partnership (TPP) free trade agreement and passing legislation to fast track a final deal through Congress – fails to take into account global development and poverty reduction interests.

“Trade can indeed spur economic growth and poverty reduction, but only if the rules actually benefit those at the lower end of the development ladder,” said Raymond C. Offenheiser, president of Oxfam America. “Although it is being negotiated in secret, what we currently know about the TPP lines up the trade deal to do exactly the opposite.”

In a letter to Congress, Oxfam joined a number of faith and development organizations, including ActionAid USA, Health Alliance International, American Jewish World Service, Evangelical Lutheran Church in America, the Presbyterian Church (USA), , and NETWORK – a National Catholic Social Justice Lobby to urge for a change in course away from the current design of TPP and the Trade Promotion Authority (TPA) bill in order for US trade policy to truly serve development outcomes and reduce global poverty.

“Broad based development should be a core objective of US trade policy, yet the Trans-Pacific Partnership fails this test, and the recently introduced Trade Promotion Authority bill would further perpetuate this problem,” said the letter. It added that without such a change in course, organizations could not support either TPA or an eventual TPP.

In particular, Oxfam and the other development groups warn that intellectual property and pharmaceutical pricing provisions are a step backward for public health, by unduly expanding monopoly power, limiting generic competition and restricting the policy space available to governments to promote access to medicines for all. Additionally, investment rules privilege the interests of foreign investors over the rights of local communities, limiting governments’ ability to regulate in the public interest. And provisions on agricultural market access and government procurement fail to take into account the legitimate interest of governments to protect national food security.

“Trade has the potential to lift millions of people out of poverty, but as we’ve seen with the US’s bilateral trade agreements, the most vulnerable get a raw deal,” continued Offenheiser.

A recent study by Oxfam in Colombia outlines how in the two years after entry into force of its trade deal with the US, Colombia’s agricultural trade deficit increased by 300%, helping to push the country from having a trade surplus with the US to having a trade deficit. The study also shows that small and medium-scale farmers producing wheat, rice and dairy products faced the greatest risk of being adversely affected as a result of the FTA, with producers of poultry, pork, corn and to some extent beans, confronting serious problems as well. Interviews with farmers showed that many have had to resort to reducing their use of inputs, reducing household consumption or defaulting on debts. Overall, farmers’ incomes dropped, they reduced production and saw themselves facing an uncertain future.

“Congress must reject the Trade Promotion Authority bill, as it would enable a bad Trans-Pacific Partnership deal to be approved by Congress without addressing significant concerns we and others have raised regarding adverse impacts for broad-based development and poverty reduction,” said Offenheiser. “The administration needs a new trade agenda, one that truly promotes shared prosperity.”

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