One of the worst aspects of the Trans-Pacific Partnership is the Investor State Dispute Settlement courts, extrajudicial bodies that allow corporations to sue nations for affecting their profits while allowing everyday citizens no legal standing. These have caused great fear in the United States that foreign corporations could sue the U.S. over environmental and labor standards. That’s a real threat, but it’s a far greater threat for the poorer nations in the pact. With the realities of international power structures, the chances of a U.S. company suing Indonesia for enacting an environmental law that affects its profits is far greater than the other way around. Indonesian activists are rightfully scared of this and are protesting against their nation potentially joining the TPP:
“According to the United Nations Conference on Trade and Development [UNCTAD], American and Canadian investors most frequently used ISDS to resolve disputes between 2013 and 2015, with the dispute cases worth US$8 million to $2.5 billion,” Rachmi said on Monday in Jakarta.
She pointed to a dispute in March 2015 brought by Churchill Mining Plc claiming $2 billion in compensation. “That’s more than a year’s worth of food subsidies Indonesia. If Indonesia lost, the effect on the state budget would be unimaginable,” she argued.
Indonesia’s investment laws currently require consent from disputing parties before a matter is taken to international arbitration. The government must first revoke the measure to comply with the TPP before it can join the trade pact of 12 Pacific Rim countries.
Meanwhile, Indonesian Labor Struggle Confederation spokesman Wibowo said the TPP ran contrary to labor justice, as it created flexibility for investors to cut employees willy-nilly.
“The right of labor to be represented at annual meetings to decide the minimum wage will be abolished. With the TPP, foreign investors could force the government to change regulations on workers,” he said.
Once again, we see labor organizers in the globally poor nations in the TPP strongly opposing it. Those of you who think that unrestricted capital mobility and free trade that empowers corporations over workers need to reckon with this opposition. Labor in these nations oppose this agreement, whether the U.S., Vietnam, or Indonesia. That should tell you a lot about what this will actually do to the world’s workers.