The German aid organisation Brot für die Welt warns that a planned EU-US free trade agreement known as TTIP will undermine local support for smallholders in developing countries and exacerbate the global food crisis. EURACTIV Germany reports.
The planned Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US threatens the concept of sustainable food security, the development NGO Brot für die Welt announced at a presentation of its annual report, in Berlin.
Development politicians agree: The key to fighting world hunger is strengthening smallholders in developing and newly industrialised countries.
“With the planned TTIP agreement, the EU and US are not only defining rules on trade between each other, but indirectly also respective trade with third states,” said Cornelia Füllkrug-Weitzel, President of Brot für die Welt.
The two large trade powers “could intensify pressure on states outside the agreement to give up protection and support for their own markets,” the aid worker said.
Support for regional food products under question
Füllkrug-Weitzel indicated Brazil’s national local procurement programme as an example, which supplies preschools and schools with regional food products for their meals.
If TTIP comes into force, international food corporations could sue such a cafeteria programme due to “illegal, trade distorting measures” that contradict the interests of free trade, Füllkrug-Weitzel explained. Local farmers would lose purchases guaranteed through such programmes and, in the worst case, even be left with no land in the end.
As of now, Füllkrug-Weitzel said there is no precedent case. But TTIP is not yet in force, she stated. “Adding one and one together” is enough to predict something like this will occur, said the organisation president. After all, the agreement aims at penetrating local markets, the NGO chief indicated.
“Through the free trade agreement, the EU and the US want to make it possible for large food companies and agribusinesses to penetrate small, local markets that have been protected so far”, said Füllkrug-Weitzel, referring to a confidential paper from the US Congress that was leaked to the public recently.
Local farmers disadvantaged
Another, and perhaps more prominent risk is the disadvantage created for agricultural goods from developing countries on the international market.
TTIP negotiators hope to bring about a decrease in tariffs between the EU and US on agriculture products. If this occurs, imports from newly industrialising and developing countries are likely to lose a portion of their market share to the United States for products like cotton, sugar, fresh produce, and fish, says Brot für die Welt.
The development aid organisation is calling for a “development policy check” for TTIP, which would evaluate the free trade agreement regarding the right to food and human rights in general.
In addition, all international trade agreements negotiated by the EU should include a human rights clause. This should offer the possibility of omitting or changing certain terms of the agreement when they threaten to violate human rights.
National economies involved promise TTIP will intensify trade activities, spur economic growth and lead to higher employment.
These expectations would be fulfilled, says a recent study published by the Munich-based Ifo Institute in partnership with the Bertelsmann Foundation, but third countries should also expect certain disadvantages. In addition to an expected increase in prosperity for the US and the EU, the study predicted considerable real losses in revenue for Asian economies.
“The increase in prosperity for Western industrialised countries should be reason enough to compensate those expected to lose out in the agreement and to be open to compromise in multilateral negotiations”, said Thieß Petersen from the Bertelsmann Foundation.
TTIP: Dr. Jekyll and Mr. Hyde?
Germany’s Federal Development Ministry (BMZ) is keeping a watchful eye on TTIP. For the time being, however, there is no evidence of possible effects TTIP could have on parallel negotiations with developing countries – neither positive nor negative, explained Daniela Zehentner-Capell at an event in Berlin.
Two current studies reached differing results, she said, but it is still too early to refer to a “Dr. Jekyll and Mr. Hyde dimension” of the TTIP agreement.
Meanwhile Füllkrug-Weitzel is cautiously optimistic that the German government will consider the criticism voiced by Brot für die Welt over the TTIP negotiations.
“The government is taking notice of our arguments,” she said.
Two days ago when she spoke with German Minister of Economic Affairs Sigmar Gabriel again Füllkrug-Weitzel said he was open to listen.
Negotiations between the US and the EU on the Transatlantic Trade and Investment Partnership (TTIP) started in July 2013 and recently concluded their sixth round of talks.
Since negotiations started in 2013, a new European Parliament has been formed which is markedly more Eurosceptic than the previous one and more likely to oppose free trade.
If successful, TTIP would cover more than 40% of global GDP and account for large shares of world trade and foreign direct investment. The EU-US trade relationship is already the biggest in the world. Traded goods and services are worth €2 billion.
TTIP would be the biggest bilateral trade deal ever negotiated, resulting in millions of euros of savings for companies and creating hundreds of thousands of jobs. It is claimed that average European households would gain an extra €545 annually, and that Europe's economy would be boosted by around 0.5% of GDP, if such a deal was fully implemented.
Brussels and Washington have set the ambitious goal of completing negotiations by the end of 2014.
- End of 2014: Official target date for end of TTIP negotiations