Charting the Future of Development: A Tale of Two Agendas

Editor’s note: this post is the winning entry for the OxHRH Summer Short Essay Competition 2014.

For its sheer scale, poverty is the greatest systemic human rights violation of our time. Roughly 1.2 billion people live on less than $1.25 a day, the internationally accepted (though absurdly low) threshold defining extreme poverty. Double that number lives on less than $2.50 a day, an amount with which they are expected to secure sufficient food, housing, healthcare, and education.

The imperative to address this deplorable situation and to reduce poverty and promote economic development is powerful and urgent. It has recently triggered two international processes that are unfolding in parallel. The first concerns the UN post-2015 international development agenda; the second, a new agenda for global trade. Each has the potential to significantly influence progress towards equitable development and the fulfilment of human rights.

At the UN, governments are debating the goals of an international development agenda to be adopted in 2015. A key premise of the negotiations is that the current level and distribution of poverty is neither inevitable nor merely a matter of poor national planning. Rather, it is the product of an asymmetrical international political and economic order that has historically contributed to the depletion of developing countries’ resources and diminished their policy space to make development and human rights-oriented fiscal decisions. Creating an effective enabling environment for development is therefore a core priority of the largest bloc of developing countries (the G77 plus China), whose demands include expeditious and ambitious reforms of the international trade and finance architecture, and international financing that respects the need for domestic policy space.

Negotiation of the post-2015 development agenda has commanded the attention of media, human rights advocates, and thousands of civil society organisations. The process has generally been transparent and open to the participation of civil society.

In stark contrast, the second global process is not only closed to civil society, but also most of our elected representatives. That process is the negotiation of the Trans-Pacific Partnership Agreement (TPPA), the Transatlantic Trade and Investment Partnership (TTIP) and the Trade in Services Agreement (TISA). Together they cover most of the world’s trade—the TPPA covers one-third of global trade, the TTIP covers all EU-US trade, and the TISA encompasses two-thirds of global trade in services—and represent an alarming new paradigm for multilateral trade and investment agreements.

The degree of secrecy surrounding these agreements is extraordinary. The texts are not publicly accessible (although hundreds of corporate lobbyists have acted as advisers) and even after the agreements are finalised, they will remain classified for at least four years, defeating any semblance of public accountability. Leaked drafts indicate that the basic intent of the agreements is to create an environment that is favourable to foreign investment by severely constraining governments’ regulatory powers, with only a small share of the text dedicated to traditional trade issues. Crippling the ability of governments to regulate to protect the environment, public health, and to ensure fair provision of other essential services jeopardises key human rights safeguards and the capacity to ensure that development is socially and environmentally sustainable. All three agreements also seek to significantly liberalise financial sector regulation to allow unhindered movement of foreign capital, undermining post-GFC attempts to regulate financial speculation and maintain balances between local and foreign capital.

More concerning still is that the TPPA and TTIP (and potentially TISA) rely on investor-state dispute settlement (ISDS) as an enforcement mechanism. Aside from grave concerns regarding the impartiality and transparency of ISDS, under the current TPPA and TTIP drafts companies can sue governments for ‘indirect expropriation,’ which has been used by companies to claim losses because of government policies made in the public interest. ISDS awards in favour of transnational corporations have also been astronomical (for example, Occidental Petroleum successfully sued Ecuador for $USD1.77 billion).

The contrast between the processes to develop the post-2015 development agenda and a new trade agenda, both of which will impact the finances and policy-making autonomy of governments, could not be more dramatic. One is participatory, internationally endorsed, but with weak accountability. The other is secretive, driven by corporate interests, and backed by a powerful and oppressive enforcement mechanism. The first is rightly under public scrutiny. The second deserves equal, if not greater, vigilance.