wikileaks | Today, WikiLeaks released the secret draft text for the Trade in
Services Agreement (TISA) Financial Services Annex, which covers 50
countries and 68.2%1
of world trade in services. The US and the EU are the main proponents
of the agreement, and the authors of most joint changes, which also
covers cross-border data flow. In a significant anti-transparency
manoeuvre by the parties, the draft has been classified to keep it
secret not just during the negotiations but for five years after the
TISA enters into force.
Despite the failures in financial regulation evident during the
2007-2008 Global Financial Crisis and calls for improvement of relevant
regulatory structures2,
proponents of TISA aim to further deregulate global financial services
markets. The draft Financial Services Annex sets rules which would
assist the expansion of financial multi-nationals – mainly headquartered
in New York, London, Paris and Frankfurt – into other nations by
preventing regulatory barriers. The leaked draft also shows that the US
is particularly keen on boosting cross-border data flow, which would
allow uninhibited exchange of personal and financial data.
TISA negotiations are currently taking place outside of the General
Agreement on Trade in Services (GATS) and the World Trade Organization
(WTO) framework. However, the Agreement is being crafted to be
compatible with GATS so that a critical mass of participants will be
able to pressure remaining WTO members to sign on in the future.
Conspicuously absent from the 50 countries covered by the negotiations
are the BRICS countries of Brazil, Russia, India and China. The
exclusive nature of TISA will weaken their position in future services
negotiations.
The draft text comes from the April 2014 negotiation round - the
sixth round since the first held in April 2013. The next round of
negotiations will take place on 23-27 June in Geneva, Switzerland.
Current WTO parties negotiating TISA are: Australia, Canada, Chile,
Chinese Taipei (Taiwan), Colombia, Costa Rica, Hong Kong, Iceland,
Israel, Japan, Liechtenstein, Mexico, New Zealand, Norway, Pakistan,
Panama, Paraguay, Peru, South Korea, Switzerland, Turkey, the United
States, and the European Union, which includes its 28 member states
Austria, Belgium, Bulgaria, Cyprus, Croatia, Czech Republic, Denmark,
Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy,
Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal,
Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.
China and Uruguay have expressed interest in joining the negotiations but so far are not included.
[1] Swiss National Center for Competence in Research: A Plurilateral Agenda for Services?: Assessing the Case for a Trade in Services Agreement, Working Paper No. 2013/29, May 2013, p. 10.
[2] For example, in June 2012 Ecuador tabled a discussion
on re-thinking regulation and GATS rules; in September 2009 the
Commission of Experts on Reforms of the International Monetary and
Financial System, convened by the President of the United Nations and
chaired by Joseph Stiglitz, released its final report,
stating that "All trade agreements need to be reviewed to ensure that
they are consistent with the need for an inclusive and comprehensive
international regulatory framework which is conducive to crisis
prevention and management, counter-cyclical and prudential safeguards,
development, and inclusive finance."
Recommended reading
- On the Wrong Side of Globalization, by Joseph E. Stiglitz, March 15, 2014.
- U.S. Foreign Trade in Services: Trends and Policy Challenges, by the Congressional Research Service, May 15, 2014.
- TISA versus Public Services, a Public Services International study by Scott Sinclair and Hadrian Mertins-Kirkwood, April 28, 2014.
- Public Citizen's Finance Regulation Factsheet
- Our World is Not for Sale Factsheet on TISA
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