International Free Trade Agreements and Social Services

Article from European Newsletter: Spring 2015

Since July 2013, the European Union (EU) and the United States of America (USA) have been negotiating a free trade agreement which would include the movement of both goods and services (Transatlantic Trade and Investment Partnership, TTIP). The negotiations are aimed to be concluded by the end of 2015. At the same time, the EU is negotiating a multilateral trade agreement for services (Trade in Services Agreement, TiSA) within a group of states outside of the World Trade Organisation (Really Good Friends of Service, RGFS states). The bilateral negotiations between the EU and Canada regarding a free trade agreement (Comprehensive Economic and Trade Agreement, CETA) have ended.

The clearance decision regarding the CETA is still pending. The TTIP, TiSA and CETA differ in scope and detail, but the negotiations have to be seen as an interrelated process.

The TTIP, CETA and TiSA should implement growth impulses through the reduction of customs duties as well as non-tariff trade restrictions. A study carried out on behalf of the German Federal Government predicts an additional per capita GDP increase in the EU of 5% within 20 years through the TTIP alone. In the same time period, this should generate up to 400,000 (100,000 in Germany) new jobs in the EU. By creating an economic area with around 800 million people as well as 50% of the global economic performance, in particular the TTIP promises a positive influence on the worldwide trade system. The EU Commission and the German Federal Government emphasise the possibility to define high qualitative standards and to motivate other states to do the same.

However, there is no reliable information to what scope the free trade agreements will have. The negotiations up to this point have been characterised by a lack of transparency. Citizens fear that their interests have not been sufficiently considered. It is unclear which – also indirect – effects the free trade agreements will have.

(from the document: Opinion of the German Association for Public and Private Welfare on International Free Trade Agrements and Social Services, 2014 : http://www.deutscher-verein.de/05-empfehlungen/empfehlungen_archiv/2014/DV-22-14-Free-Trade-Agreements-and-Social-Services_en)

ICSW Germany’s position on free trade agreements and social services

ICSW Germany (German Association for Public and Private Welfare) responded to current negotiations on international free trade agreements, notably the Transatlantic Trade and Investment Partnership (TTIP) between the European Union (EU) and the United States of America (USA). The agreements aim at growth impulses for the national economies through the reduction of customs duties as well as non-tariff trade restrictions. ICSW Germany calls for these international free trade agreements to have a full-scale exemption for social services. Legal provisions and regulations regarding the quality of social services must not be interpreted as restrictions on trade. The organisation of the welfare state within the EU Member States and the responsibility of the Member States for social and public services must not be undermined by free trade agreements.

(Britta Spilker, ICSW Europe Board Member)