Instead of being free to follow economic policies that best suit them, poor countries in southern Africa are being put under enormous pressure to open up their markets and expose their producers to unfair competition.
Trade could help poor countries develop, but instead the rules are stacked up against them. Southern African countries are being forced to reduce their trade barriers, so heavily subsidised products from overseas flood their markets, while rich countries impose high taxes on processed goods sold on their markets.
ACTSA aims to influence decision makers to ensure that the eradication of poverty and sustainable development is central to trade negotiations.
Bilateral Investment Treaties (BITs)
Bilateral Investment Treaties (BITs) are treaties between two countries that deal exclusively with the protections to be offered to international investors. In effect, they mean that companies have little need to undertake risk assessments because they know that people in the country they are investing in will always pick up the tab if the company’s profits are hit by government policy changes.
The UK has BITs with more than 100 countries, more than two-thirds of them are developing countries. Because it is very unusual for developing country businesses to be able to afford to invest in rich countries, the UK knew when it signed the deals that it was exposing itself to minimal risk. The treaties allow companies to challenge a wide range of government policy decisions, including changes to labour laws, environmental regulations and tariffs for utilities.
The Economic Partnership Agreement (EPA) between the European Union and Southern African Development Community is a legally binding trade agreement that entered into effect on 10 October 2016. ACTSA was involved in discussions about the EPA with civil society organisations in the UK and in Southern Africa. This letter to Members of the European Parliament was signed by a range of trade unionists and provides a useful summary of key concerns regarding the EPA. With the EPA now a reality, ACTSA will continue to engage with trade unions and other civil society organisations to see how we can best monitor the impacts of this trade agreement, and promote sustainable development and human rights. You can read the full letter here.