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Can post-Brexit trade deals protect social and climate justice?


Theresa May and the Prime Minister of India, Narendra Modi, September 2016. Narendra Modi under a Creative Commons Licence

There are only so many things that are clear about Brexit: hate crime has risen, the economy has suffered, at least to a certain extent – and new trade agreements are on the British horizon.

As we wait for the negotiations to start, we must prepare to advocate for environmental and social protections to be included in all new agreements, instead of more deregulation.

Professor James Harrison of Warwick Law School has been researching the human rights and environmental impacts of economic laws and regulations for years. He has written on human rights, the environment and trade justice, has worked with numerous NGOs and UN agencies and is Co-Director of the Centre for Human Rights in Practice.

To inform the debate on the UK’s forthcoming trade agreements, Chris Jarvis, campaigner at People & Planet, interviews him.

How do you see the relationship between trade agreements and human rights, focusing on the impacts to workers' human rights internationally?

The traditional justification for signing up to trade agreements is that liberalised trade produces growth, growth reduces poverty and reductions in poverty mean that workers will do better in the longer term. But even mainstream economists now recognise that the story is far more complicated than that. It is very difficult to predict the effects of trade liberalisation on each individual country (let alone different groups of workers within each country), and most modern trade agreements include many obligations that are not about trade liberalisation at all (for example intellectual property protection). So we should examine very carefully what the impact of any proposed trade agreement is on workers’ rights.

Much of the anti-trade rhetoric which we now see in the US and the EU is driven by concerns that trade agreements do not take into account the needs of workers and ordinary people, but instead prioritize the interests of big corporations. Perhaps the most notorious example of this is that many trade agreements now contain provisions which give companies the right to sue countries through international arbitration. Companies can win hundreds of millions of pounds in damages. But labour rights are not so well protected in trade agreements. For instance, EU agreements only contain an obligation to have a dialogue between the trading partners. My own research which examined these dialogues found them to be under-resourced and ineffective. So we should be concerned about the relative weight which is given to the concerns of big business and workers within free trade agreements.

Prior to the June 2016 referendum, many in the Brexit camp said they wanted to 'take back control' over trade agreements, and extend free trade agreements with countries outside the EU, often citing previous colonies. Will it be possible for the UK to enter into new trade agreements with countries like Australia, India and South Africa while it negotiates its departure from the EU in London and Brussels over the next few years?

Liam Fox, Secretary of State for International Trade was reported in the Financial Times to be ‘scoping out about a dozen trade deals outside the EU to be ready for when we leave the EU’.

But he is going to have a great deal of problems in doing this, or even talking about deals further. He isn’t in a position to say or do anything about our trading relationship with non-EU countries until the UK’s post-Brexit trade relationship with the EU is clarified. And that isn’t going to happen until we have negotiated the terms on which we will be leaving the EU.

It is becoming increasingly clear that within the UK government some fundamental questions about trade policy remain unanswered. Most importantly are we going to stay in the customs union? It could all be very simple for the UK’s trade relationship with non-EU countries.

If the UK remains part of the customs union – the UK won’t be doing deals with non-EU countries like Australia, India and South Africa because it will not be able to offer reductions in tariffs and all the other goodies that other countries want from the UK.

If we do leave the customs union and the single market we are free to negotiate our own deals. But that is going to be a complex, difficult and long-winded process. Then there are all the countries who already have trade deals with the EU (like South Korea and Norway). Sorting out our new trading relationships with those countries could also get tricky.

If the UK is able to enter into new trade agreements going forward, with the EU and countries outside it, how could we ensure that these agreements uphold – rather than suppress – human rights? And how can we ensure that democratic oversight is maintained over future environmental and labour policy?

Theresa May has promised us an economic system that works ‘for everyone’. The fears and concerns which drove Brexit are partly about a trading system that is part of bigger processes of globalisation which is widely viewed as not achieving that.

On the other hand, reading between the lines of Liam Fox’s speeches and his pure ‘free trade rhetoric’, UK trade policy may well be based around achieving market access and competitiveness for British transnational businesses overseas and for foreign transnationals to invest in the UK.

There are likely to be great tensions between commercial interests in opening up markets and broader social and environmental concerns. Big business always has a strong voice at the table. Broader social and environmental concerns often get left out. So we need to start thinking about those issues now, and come up with viable models for how trade agreements can work to protect a broader social and environmental agenda.

Often policy generation works too fast for academic research to be of value. But the long timescale before the UK’s trade policy gets sorted out makes it possible for us to do research and bring ideas to the table. So, I am involved in a project which brings together academics with trade unions, development organizations and other NGOs to think through some of these issues.

If Britain does get its own independent trade policy, we need to have the policy ideas to make sure UK trade agreements do ‘work for everyone’. For example, one idea is a worker-led complaints mechanism that would lead to suspension of trade preferences for companies found to have violated important labour rights of workers. We need to think carefully about these kind of ideas, and then bring them to trade debates that are otherwise likely to be dominated by narrow commercial interests.

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