How can trade agreements help promote respect for human rights?

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The EU referendum vote brings with it the real possibility that the UK will have to develop its own trade and investment policy, making new agreements with trading partners around the world. Liz May thinks through what implications this could have on human rights.

This blog will focus on a potentially thorny question – will the UK’s post-Brexit trade agreements support human rights? I will argue that simply including clauses or chapters with specific human rights provisions into a trade agreement may not be enough. These could be little more than a fig leaf. Rather, the totality of each agreement needs to be assessed from a human rights perspective.

Let’s start by reflecting on the primary purpose of Free Trade Agreements (FTAs). These are designed to cut down ‘red tape’ and make it easier for companies to trade so that more can be bought and sold across borders. The theory is that more trade leads to more jobs and more development. The latest more comprehensive deals such as CETA go well beyond reducing tariffs related to goods, and press for much deeper harmonisation of regulatory standards. To the free trade purist any limits – including labour rights or environmental standards – are unwelcome.

The last twenty years however have shown that unregulated globalisation has exacerbated inequality and left millions behind – indeed that could be seen as one of the key drivers behind the Brexit vote and the US election result. Free trade has favoured the stronger and more powerful actors, both countries and corporations, leaving the vulnerable to pick up the pieces. There is a growing consensus that jobless growth is not enough; for trade to play a role in creating decent work and developing strong and balanced economies there have to be limits, checks and balances. The rules have to be fair. So surely a good step would be to press for human rights rules to be inserted into FTAs?

The United Nations ‘Independent Expert on the promotion of a democratic and equitable international order’, Alfred de Zayas, recently authored an incredibly detailed study on how FTAs can undermine the realisation of human rights.  For example, intellectual property provisions can affect access to generic medicines and health care, investment liberalisation can erode rights to land and various trade provisions, including the banning of export subsidies, can have important implications on the right to food.

The UK’s International Trade Secretary, Liam Fox, has expressed strong support for FTAs

The UK’s International Trade Secretary, Liam Fox, has expressed strong support for FTAs

Attempts to make progress on human rights via trade agreements have met with mixed success so far. There is a clear gap between the intention and the practice. A review of the EU’s recent wave of FTAs which include labour rights provisions, conducted by academics at Queen Mary and Warwick University, found the provisions insufficiently targeted and enforcement mechanisms too weak. Some newer bilateral investment treaties contain human rights clauses, but they are rarely invoked and their impact is offset by other elements of the deals.

It seems clear that simply inserting clauses which require states or businesses to respect human rights into instruments whose primary purpose is to free up and deregulate trade misses the deeper challenge to human rights posed by FTAs. At best they are insufficient, at worst they provide ‘cover’ for a host of wider human rights threats.

To ensure trade agreements truly uphold human rights requires a more fundamental re-thinking of their purpose, what is included in them and who is involved in their negotiation. Whilst this may feel a long way off, the Brexit vote has landed us in uncharted territory and we have an opportunity to re-set the narrative around trade.

A good starting point would be for states to get their domestic law in order first. This includes implementing laws that would enable companies to be held to account if they fail to prevent serious crimes such as killing, serious injury or widespread pollution through their overseas operations. When countries assert the need for others to tackle human rights without taking the necessary steps to make sure that their own citizens and corporations can be effectively held to account at home, is it any wonder that we would question their motives?

Next we should be pressing for maximum scrutiny by civil society and parliamentarians of FTA proposals and for negotiating mandates to be subject to rigorous and binding environmental, development and human rights impact assessments before proceeding (as proposed by former UN Special Rapporteur on the Right to Food, Olivier de Schutter).

Following that, then of course it makes sense also to look at how to incorporate human rights provisions into agreements in a way that is binding, balances corporate privilege with corporate responsibilities and which includes strong, independent and accessible enforcement mechanisms.

Traidcraft is a company that has traded for nearly 40 years with suppliers in over 30 developing countries. We know that trade and investment are critically important for developing countries and can have a transformative impact on the lives of producers and their communities. But fairer trade will not be brought about through the current model of reciprocal FTAs, nor will human rights be upheld by simply asserting them within these flawed, outdated instruments.  We may be about to be presented with an opportunity to do things completely differently. If and when that happens we need to be ready to promote credible alternatives.

Liz May is Head of Policy and Advocacy at Traidcraft Exchange.