Ottawa – The signing of a Foreign Investment Protection Agreement with China during the Prime Minister’s state visit this week would be a sign the Harper government is only interested in protecting rights for some humans (and rich corporations) – not human rights generally, says the Council of Canadians. The organization opposes the FIPAs and other bilateral investment treaties which have been used extensively by corporations and investors to undermine the public good globally.
“The political and human rights situation in China remains abysmal. Social unrest is increasing and the extent of environmental degradation from rapid industrialization is truly shocking. The last thing Canada should be pushing on that country right now is a legal right-of-way for Canadian corporations to challenge measures that interfere with their profits,” says Maude Barlow, national chairperson with the Council of Canadians.
The investment rules in Canada’s FIPAs and other bilateral investment treaties (BITs) contain broad protections for corporations while imposing few if any responsibilities onto investors. These rules not only ban countries from treating foreign investors any differently from local investors, but also restrict performance requirements set by governments for development purposes, including technology transfer requirements, while providing for compensation for investors in the event of regulatory or indirect expropriation.
“China has been an attractive base for global manufacturing and exporters because of its abundant natural resources, extremely low wages and lax environmental standards,” says Barlow. “As Canada seeks closer trade and investment relations with China, the investor-state dispute process in a FIPA would just put another barrier in the way for needed reforms in all these areas. In other words, Harper’s trade agenda is a barrier to human rights improvement in China.”
Canada has signed FIPAs with dozens of countries and continues to negotiate broad investment protections and an investor-state dispute process into its free trade agreements. The template for this process is NAFTA, which has been used by U.S. firms to extract over $160 million from lawsuits against Canadian public policy. The flip side of a FIPA with China would be that new Chinese investment in the Alberta tar sands would be locked in as Chinese investors would have the same rights to sue Canada for new environmental measures or public decisions against the Northern Gateway pipeline or other projects.
Recently, the Harper government signed free trade deals with Colombia, Peru, Panama and Honduras – all countries with poor labour, human rights and environmental standards. The Council of Canadians opposed these agreements on the grounds they would only exacerbate these conditions while giving Canadian corporations a new right to profit in land-intensive industries such as mining and extractives.
“The argument that improved trade and investment ties lead naturally to better human rights is completely hollow,” says Stuart Trew, trade campaigner with the Council of Canadians. “Four labour leaders were killed in Colombia in January. Human rights defenders continue to be threatened by paramilitary successor groups and internal displacement continues apace to make room for so-called legitimate economic activity.”
The Council of Canadians is part of a global network opposing extreme investor protections in FIPAs, BITs or free trade agreements. In November 2011, the organization joined 91 others and seven regional networks calling for an end to these existing investment frameworks and for an alternative approach which:
- incorporates binding obligations on corporations related to human, economic, environmental, labour and social rights
- excludes investor-state dispute settlement mechanisms
- does not grant greater rights for foreign investors
- guarantees full democratic policy space to governments to regulate in favour of public interests, the environment and sustainable development
- includes the right to restrict and control speculative and destabilising international capital flows
- places areas like health, food, public services, eco-systems and natural resources firmly under public control and investment
– 30 –