News

Go back

The TPP and the AUSTFA agreement: Have we learnt our lessons?

Published 13 Sep 2015
Lewis Graham

By reflecting on the legacy of AUSTFA, Australians may more readily hold their politicians to account in regards to TPP negotiations.

It is considered normal for Free Trade Agreements (FTAs) to be negotiated in secret lest a State’s bargaining position be compromised should it be made public. The Trans-Pacific Partnership (TPP), the largest Free Trade Agreement ever in terms of Global GDP, 40%, and in terms of global trade percentage, almost a third, has followed this model and has been discussed in almost complete secrecy over the past 5 years. Indeed, this treaty has taken secrecy to entirely new levels with revelations that politicians allowed to see the agreement will not be able to reveal publicly their reservations until four years after the deal has come into effect.

However such opaqueness in the case of the TPP should not be deemed acceptable by Australians due to the treaty’s intrusions into crucial areas of domestic public policy which are usually subject to public transparency, scrutiny and accountability. Key amongst these issues are changes to Intellectual property law, food safety regulations, potential changes to the Pharmaceutical Benefits Scheme and the introduction of an Investor-State Dispute Settlement (ISDS) clause.

To understand why Australia should be cautious about providing tacit consent to the confidentiality of negotiations with such “beyond the border” implications in play, the nation must reflect on whether it has learned sufficient lessons from our last FTA escapade with America, the 2005 Australian-US Free Trade Agreement (AUSTFA). With its striking parallels to the TPP, the AUSTFA experience provides a strong case for why discretion is the better part of valour.  The comparison is a reminder that FTAs are not solely golden economic opportunities, but have the potential to stifle Australia economically and socially by serving foreign interests over those of our own.

First and foremost, the AUSTFA provides an excellent precedent as it concerned itself with the same radical scope as the TPP. The issues on the table for AUSTFA, like the TPP, included free trade, intellectual property laws, food safety and quarantine regulations, government procurement policy, pharmaceuticals and biologics, and ISDS.

Secondly, the AUSTFA is analogous in terms of the rhetoric surrounding the agreements. Linda Weiss, Elizabeth Thurbon and John Mathews in their book on the AUSFTA, How to Kill a Country, classified contemporary media discussions as “gagged”. According to them, the Australian public was primarily subject to one sided governmental rhetoric, epitomised by claims of “a once in a generation opportunity for Australia”, by then Prime Minister John Howard. One may well draw parallels to the TPP in view of the restricted discourse due outlined above as well as the prolific and grandiose claims from the government that the TPP will provide a “free trade agreement times 12” and one that carries “transformational promise”.

The similarities are evident not only within public rhetoric, but also in the use of economic data. Weiss and her colleagues concluded that the Howard government cherry-picked questionable econometric modelling to sell the AUSTFA. Likewise for the TPP, estimates about the benefits of the arrangement for Australia vary greatly: recent US department of Agriculture figures suggest that the TPP would provide 0% growth to Australia in terms of agricultural trade and this in an industry which is promoted as our greatest potential beneficiary from the agreement.

With these similarities in mind, the disconcerting results of the AUSTFA negotiations provide compelling evidence for why Australia should proceed with caution with the TPP. According to Shiro Armstrong of ANU, AUSTFA provided little to no increase in free access to the American market, and in fact caused a fall in trade between the two countries. In return for this result, Australia relaxed its quarantine and food safety standards, replaced parts of its internationally acclaimed intellectual property laws so as to align them more with those in America, reduced public purchasing policy to levels below America’s, and as well, changed crucial elements of the PBS, causing essential medical prices to go up, despite initial claims the PBS would be left off the table.

Evidently, the positives of maintaining the confidentiality of negotiations are grossly outweighed by the potential negatives of allowing the TPP to continue without proper transparency and accountability. The Australian public must use their democratically guaranteed powers to make clear that perhaps citizens sometimes are better at recognising a bad deal when they see one than governments are. Should they wave this right, as the saying goes, fool us once shame on you, fool me twice, shame on us.


Lewis Graham is in the final semester of a Bachelor of International Studies at UNSW majoring in Globalisation studies. He is particularly interested in the development of global economic regulation/law, an area on which he has recently published work in Politik UNSW journal, and upon which he intends focus his honours thesis. Prior to the AIIA, Lewis interned with Surfaid International, an accomplished development NGO which works in the Mentawi Islands in Indonesia. After completing a postgraduate law degree, he wishes to pursue a career in international economic policy/law in either a public or private capacity.