A new document leaked on Wikileaks indicates that State-owned enterprises (SOEs) would be severely restricted under the Trans-Pacific Partnership(TPP) regulations.
The rules would force SOE's to be run on the basis of "commercial considerations" and this could force them to give up public service mandates if these needed to be subsidized. Sujat Dey, of the Council of Canadians said;Many have spoken out against the dangers of the TPP including Noam Chomsky who claims that it is "designed to carry forward the neoliberal project to maximize profit and domination, and to set the working people in the world in competition with one another so as to lower wages to increase insecurity." Presidential candidate Bernie Sanders has also spoken out against the TPP as has liberal economist Paul Krugman. Economist Robert Reich said that the TPP is a "Trojan horse in a global race to the bottom, giving big corporations and Wall Street banks a way to eliminate any and all laws and regulations that get in the way of their profits."Wikileaks released a letter that was to guide negotiators on how SOEs should be treated under the deal. SOEs would include public utilities, telecommunications providers, state-run investment companies, or even mining or energy companies that are state-owned. These SOEs are to operate "on the basis of commercial considerations." Jane Kelsey, a New Zealand law professor said:The letter suggests that countries could be sued if an SOE is adversely affecting its interests:
"The TPP will hinder our state-owned enterprises from acting in the public interest. The very mission of the CBC -- telling the bilingual and multicultural story of Canada -- will be reduced to simple profit-making. Likewise, Canada Post will no longer function as a nation builder, but as a private company. The essence and mandate of our Crown corporations are being traded away in favour of private corporate profit."Both the CBC and Canada Post have been evolving in this direction over the last decades. The new rules will simply hasten the process. Garry Neil, also of the Council and a cultural policy expert said of the CBC:
"Forbidding it from giving preference to Canadian producers undermines the Canadian content rules that ensure it remains an essentially Canadian service. All of this sets the stage for the privatization of the CBC, which has been the goal of the Harper government since it was first elected."The TPP will be the largest economic trade agreement in the world. The GDP of the 12 countries involved comprise more than 40 percent of global GDP.
“SOEs are almost always state-owned because they have functions other than those that are merely commercial...such as guaranteed access to important services, or because social, cultural, development and commercial functions are inextricably intertwined.”Many developed nations have SOE's and in developing nations SOE's are important since they do not follow market or commercial principles that might disadvantage poorer citizens. Kelsey has a detailed analysis of the letter that can be found here.
"... it suggests that a postal service, public telecommunications provider or state-owned bank that receives financial support from the government to deliver services into poor areas for social reasons could be challenged by a courier firm, satellite operator or internet bank from another country that says the support is adversely affecting it and hence its country’s interests."Kelsey suggests that the restriction of SOE's to operations on commercial principles results in structuring SOE's so that they could be easily privatized. As the appended video shows, once functions are privatized they cannot be taken back into public ownership. Those already in public ownership can no longer play a role outside commercial concerns. Of course all of this is very controversial since many countries may find it politically necessary to defend a wider role for their own SOE's. Powerful players will probably be able to negotiate exceptions for some of their own SOE's while the less powerful will be forced to yield. Fortunately. a recent meeting to finish the TPP broke up with no agreement.