John Healey recently secured a Backbench debate in the Commons to consider the Transatlantic Trade and Investment Partnership between the EU and US. He began by emphasising the sheer scale of the deal, which would cover 30% of global trade and almost 50% of the world’s output. He also spoke of the relevance of the timing of these negotiations – since the 2008 global financial crisis, there is widespread mistrust of politicians and big businesses – these trade talks must therefore be open if they are to receive public backing.
Mr Healey then stressed the cross-party nature of the support for free trade, stating that he is part of a Labour movement that fully endorses the benefits of free and fair trade. He said a progressive pro-trade attitude is vital for a deal on this scale. The size of their combined economies mean that this deal could set standards for future trade agreements with other countries on consumer safeguards, worker’s rights, environmental protection, trade rules and legal process. Robert Walter also argued that by creating a deal of this scale between the world’s two biggest trading partners, it would provide a building block towards global free trade in the absence of any meaningful progress at the World Trade Organisation.
The Minister, Kenneth Clarke, picked up on both these points in his response, saying that we would have preferred an arrangement like the Doha Round, under the auspices of the WTO, but since that is not a realistic option at present this kind of large-scale FTA could provide another avenue towards creating global free trade. He also emphasised the fact that a comprehensive agreement on this scale would undoubtedly set standards that would guide future trade agreements.
Several members picked up on the theme of avoiding history’s mistakes. Mark Field spoke of politicians’ desires post-2008 to avoid the mistakes made during the banking collapse of the 1930s, but said it was a shame that the same care was not being taken to avoid lessons we should have learned from the same period about the dangers of protectionism. He called for global leaders to make a strong case for the massive benefits of free trade and to break down remaining barriers.
Robert Syms said, “we have learnt from history that trade – and free trade in particular – has enabled us all to make ourselves richer…..I can see nothing but benefit if we can simplify regulation, reduce barriers and increase trade”. If such an attitude can be taken to this EU-US deal, then it should also be extended to all trade deals with developing economies. The beneficial effects that this deal, if done properly, could have for the rest of the world were also expounded by John Spellar, who said, “Free trade has been a major driver in the removal of a massive number of the world’s people from poverty during the past two centuries, particularly during the past 30 years. However, we must also consider the effects on wage distribution and the environment in other countries, and understand that generally protection does not benefit the worker or the consumer; mainly it benefits the monopolist, the corrupt bureaucrat or the profiteer and black marketeer.”
The belief that TTIP will benefit global trade generally as also expressed by William Bain, who hoped that it could provide the catalyst for similar agreements across the world – “we have to bring down barriers to trade if we are to rebalance the global economy.” While the general opinion was one of optimism for the potential widespread benefits of TTIP, the warning made by Ian Murray should be headed – “crucially, the benefits of any trade deal must filter down to employees, SMEs and consumers, and not just corporate interests”. This must be true not only for the benefits of TTIP for EU and US, but also for its effects on less-developed countries as well as the structuring of any other trade deal.
Read the debate in full here
A backbench debate in the House of Commons provided an opportunity for many MPs to extol the general benefits of free trade. There was much discussion of the potential for widespread positive impacts not just in the EU and US, but throughout the global economy. It was also stressed that this could be an opportunity to create a trade agreement that could set the standard for other such deals around the world.