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Trade agreements: Freer rein for corporations

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OJARASCA | 8 September 2017

Trade agreements: Freer rein for corporations


On 1 January 1994, the North American Free Trade Agreement (NAFTA) came into effect claiming to be a new instrument of economic harmonisation among the signatory countries – the United States, Canada, and Mexico.

That same day, a community-based indigenous movement known as EZLN took up arms against the Mexican government, setting off broad repercussions that continue to reverberate around the world. One purpose of the uprising was indeed to unequivocally reject trade agreements due to the role they play in the renunciation of national sovereignty.

As the researcher Guillermo Bonfil Batalla wrote just before his death, trade agreements “prevent us from achieving the future we desire, one that is consistent with our history, our multifaceted reality, and the many seeds of our future lying within the cultures of Mexico.” He added: “Are Mexicans adopting this model in a free exercise of their sovereignty?” [1]

The initial purpose of these agreements was to lock in the structural reforms imposed by the World Bank and the IMF as part of the Washington Consensus, with a view to dismantling public policies that had for many years defined a certain horizon of development with justice. Today, these agreements are supplanting domestic law with provisions drafted by business and investment interests outside the legislative chambers. Corporations are devising a legal framework in which new corporate rights supplant the rights of affected populations, leaving the latter without access to justice and hence defenceless. Trade agreements are tools for the usurpation of power and the subjugation of law. And NAFTA was the blueprint to which many subsequent refinements have been made.

With the years, bilateral and multilateral agreements have proliferated and become more all-encompassing. The more recent ones “are characterised by their breadth and their open and ‘evolving’ nature. Signatories agree to pursue a continual series of negotiations aimed at opening up new sectors of their economy. They embark on an indefinite number of legal, administrative, economic, and social reforms whose purpose is to give the corporations ever more favourable conditions for investment.” These are real, albeit “gradual,” legal reforms defined at the ministerial level, far from any parliamentary, judicial, or public oversight.” The idea is for the rules stemming from “trade” or “cooperation” agreements to prevail over domestic law and people’s rights. [2]

Whether termed “cooperation,” “trade,” “cultural,” or “technology transfer” agreements, these documents all establish a set of provisions, criteria, rules, standards, procedures, programmes, projects, and budget items. They affect broad segments of governmental activity, including general administration, intellectual property, food safety, labour and environmental standards, quality standards and, above all, the jurisdiction of domestic courts to decide crucial questions.

These agreements allow the transnationals to keep an eye on policymaking and regulatory processes, and even to sue governments under investor-state dispute settlement (ISDS) mechanisms. “The treaties grant transnational corporations (TNCs) a special right to take foreign governments to binding arbitration when they consider themselves treated unfairly. This means that TNCs can ‘sue’ governments when they adopt public policies… that might restrict their investments and profits. Domestic companies don’t get this same right…” [3]

Today, the many bilateral and multilateral agreements that have succeeded NAFTA are laying siege to any and all laws that seek to promote collective rights or protect common property, be it indigenous and peasant territories, land, seeds, water, mountains, minerals, or forests. But these agreements also pry open new markets for the corporations – telecommunications and energy, for example – and grant them new intellectual property rights. As a result, environmental devastation has reached unprecedented levels, while labour has been casualised to an extent verging on enslavement. These developments are all crucial to the corporations’ agenda. Signatory governments are forced to revise their laws under binding commitments that allow for no turning back. [4]

In Mexico, NAFTA touched off a wave of devastation that led to a worsening of economic, social, political, and cultural conditions. Today, the country is submerged in a day-to-day horror of unending violence. Civil society, reeling from the series of blows it was dealt, responded by convening the Permanent People’s Tribunal, which held sessions between 2011 and 2014. This ethics-based tribunal, concerned with what it called “the subjugation of judicial and legal structures by economic interests all over the globe,” identified trade agreements as instruments that run roughshod over the legal frameworks of signatory nations. In its final judgment, the Tribunal wrote:

“Neoliberal law provides a conducive framework for the accumulation of wealth and the concentration of economic and political power while helping to eliminate the “losers.” It is predicated on an architecture of impunity built up in favour of multinationals and capital. Inequality and asymmetry are constituent features of this architecture.
The government of Mexico has intervened, using economic methods, to facilitate the compulsory transformation and exclusion of broad masses of people considered “unnecessary” or “superfluous” from city and country alike. Successive governments have used the power of the state to accelerate this process directly, by dispossessing people of the means of production, and indirectly through interventions that distort the subsistence economy.
NAFTA forms a part of this politico-legal apparatus of domination. Human rights and corporate rights share no common ground; there has been a thorough overturning of the hierarchy, the normative pyramid, of the human rights protection system.
It is crucial to understand that NAFTA and the other neoliberal institutions are not designed to promote the social good. The purpose of these agreements is to elevate the legal status of big investors and, simultaneously, to bind the state’s economic power to their interests, even as they erode nation-states’ commitment to the protection of their citizens, and deprive them of the tools needed to make good on that commitment.
A central purpose of these trade treaties has been to disarm peoples, to dispossess them of the tools of identification, expression, resistance, and transformation that can offer them national sovereignty and a legitimate state.” [5]

As put the matter in early July, there can be no tolerating positions that seek to reform or remodel the treaties so as to give them “a human face.” We must instead identify them as “comprehensive instruments designed to advance and lock in imperialism and the power of global capital, as well as fulfill geopolitical goals.” We must not be distracted from our counter-systemic organising efforts, from working outside and against the tight strictures of capitalism, by being drawn into superficial or piecemeal campaigns. The defence of our territories and the construction of peoples’ self-determination demands no less. [6]


[1] Guillermo Bonfil Batalla, “Implicaciones culturales del Tratado de Libre Comercio,” México Indígena Nueva Época, no. 24, September 1991.

[2] GRAIN, “¿Renunciar a la soberanía nacional?,” June 2008 GRAIN, “The disease of the day: Acute treatyitis - The Myths and Consequences of free trade agreements with the US,” May 2004,

[3] Nyeleni newsletter, no. 29, “FTAs and agriculture,”

[4] Ibid.

[5] Permanent Peoples’ Tribunal, “Free trade, violence, impunity and peoples’ rights in Mexico”, judgment of the final session, 15 November 2014,

[6], “Trade politics in flux: What social movement responses?”, 29 June 2017,

 source: Ojarasca