In a report the prestigious London School of Economics passes a withering judgement on TTIP: The Agreement would implicate many risks but no benefits. Juicy: The report had been commissioned by the government itself. However, it ended up in the drawer then. Instead, Premier Cameron campaigned for the Agreement in Britain.
Originally appeared at DWN, translated by John T. Sumner exclusively for SouthFront
Under the Freedom of Information Act, TTIP-opponents of “Global Justice Now” in the UK have constrained the publication of the only report ever ordered by the government, to investigate the impact of TTIP. The result is likely to involve Prime Minister David Cameron in real difficulties and could also affect the EU-referendum. For the London School of Economics (LSE) delivers a damning indictment in the report, drafted already in 2013: The TTIP will be of no benefit to the UK, instead it will imply substantial risks and will also impose significant duties on the British taxpayers.
In the report, the LSE examined the mechanisms of TTIP, noting it “will bring little or no benefits for Britain”. However, the LSE expects “significant expenses for the UK”. The report: “All in all, it is doubtful that British investors will gain any additional protection in the US, that would go beyond that level of protection, that already can be enforced in US courts on the basis of the present EU agreement.” UK “will be exposed to high cost”, resulting from arbitration court lawsuits at the expense of the British taxpayers.
In that evaluation, the experiences of Canada with the NAFTA agreement were used for comparison. Accordingly, Canada had “to deploy significant resources in order to defend itself against investor protection suits”. In about 30 cases, Canadians were asked to pay. They would have to respond to this by “either effecting a compromise, or pay compensation, or they had to change the laws.” Expectably the UK will gain similar experiences. According to the LSE, the number of proceedings against the UK would be even greater than those against Canada.
The LSE cannot recognize the alleged benefits for the British economy in connection with TTIP – for one simple reason: US investors in the UK could act with great legal certainty already today. TTIP would bring no additional investments, because the agreement will not provide new incentives. Thus far, investors have focused on market conditions instead of making investment decisions dependent on free trade agreements. The situation would be much different in the UK than in other countries, where political and legal uncertainties would make such an agreement appear expedient.
The LSE, which cites numerous investor protection suits from existing free trade agreements, reaches an interesting result regarding the real danger of TTIP for Britain: There would be no expectations that investors from other countries such as India and China would be encouraged by TTIP, to invest in the UK. Thereby the LSE is hinting, that in the UK an advantage by TTIP would be given only to the US – at the expense of other investors.
The situation in Germany is quite comparable to the UK: A high degree of legal certainty for US investors is already existing. Therefore, numerous direct investments by American companies in Germany are in effect. Many of these investments are backed by investment protection clauses even now. The same applies to other EU countries such as France, Sweden or Austria. On the other hand, the bad experiences, Canada has made with NAFTA, are likely to be transferable to the German circumstances.
In the countries of Eastern Europe, it might look different, however. The insistence of the US government on TTIP could therefore be motivated by the desire of the Americans to expand into the markets of Eastern Europe. Negotiating partner would then be the EU Commission instead of the states of Eastern Europe, regarded as unpredictable by Washington.
For David Cameron the leaked publication is at least embarrassing, because the government had made the report, which it had commissioned itself, quietly end up in a drawer. Cameron, who had met with German Chancellor Angela Merkel and US President Barack Obama in Hanover on Monday, has vigorously promoted TTIP among the British. The Independent quotes TTIP critics with their accuse, that Cameron had tried to sell the blessings of TTIP to the British against better judgment – although the LSE experts had provided massive arguments against TTIP.
Due to his involvement in the Panama Scandal Cameron is already under significant pressure. Important party members failed to back the Premier on the issue of EU membership and fight openly for the exit of Britain from the EU. Therefore, Cameron’s credibility has already been damaged ahead of the referendum in June.
Cameron’s campaign for TTIP is not unlike that of Chancellor Angela Merkel: So far also Merkel has made no details of TTIP public, but instead constantly keeps reiterating in ambiguous, shallow terms, that Germany would greatly benefit from TTIP. Whether the Federal Government has ordered a similar survey concerning TTIP, remains unknown. Negotiations on TTIP are subject to the strictest secrecy. Also positive assessments are pure speculations. So far the Germans are at least don´t seem convinced: On Saturday thousands of TTIP opponents protested in Hannover.
Left Party leader Sahra Wagenknecht is pressing for a nationwide referendum on TTIP.