The Trade in Services Agreement (TiSA) is a massive trade deal, currently under negotiation between 50 countries, the so-called ‘Really Good Friends of Services’. The EU and US are the main proponents. Most of those signed up are high income countries, heavily dependant on the services sector: they exclude the major emerging world economies – Brazil, India, Russia, South Africa and China (‘BRICS’).
Among their objectives are
- to turn services into tradable commodities;
- eliminate the role of governments in the provision of services; and
- remove national and local government regulation of services.
TiSA is concerned with about 70% of the global trade in services. These include health, education, water supply, transport, housing, energy, telecommunications and financial services such as banking, insurance and pensions. In other words, TiSA covers services that we expect governments to regulate – not least to ensure that, irrespective of commercial interests, they remain sustainable and accessible to those who are socially and economically and socially disadvantaged.
TiSA is backed by some of the world’s biggest corporations, such as Microsoft, Google, IBM, Walt Disney, Walmart, Citigroup and JP Morgan Chase and there are concerns that, not only are these sorts of corporations putting massive pressure on negotiators to influence the content of TiSA, but there is little resistance to this.
Those behind TISA want to remove government involvement in the provision of public services. Instead, these services should be privatised, run by commercial companies operating in a global market and facing minimal regulation. At the same time, TiSA aims to give all foreign providers of services access to domestic markets on the same terms as domestic suppliers. This would bring a fundamental shift in the regulation of many public (and privatised) services from serving the public interest to serving the interests of private, foreign corporations.
Any new services that develop in future (e.g. as a result of technological innovation) will automatically be included in TiSA, without further negotiation.
It appears that TiSA will not include a dispute mechanism like ISDS (as found in TTIP, for example) to challenge government initiatives that might affect business profits, but will instead rely on the method used by the World Trade Organisation’s state-to-state dispute mechanism. In this approach, treaty members are able to file challenges against each other over regulations that they believe represent a “disguised restriction on trade in services”. In practice, this method, as it’s used by the WTO, has almost always delivered a verdict against new regulations.
The treaty’s negotiations have been highly secretive (what is known publicly comes largely from leaks) and the concessions being made by negotiators will only be publicly available five years after TiSA comes into force.
What it’s thought TiSA will mean for health services
It’s feared that TiSA will pose significant threat to public healthcare services. Public provision of healthcare would be at risk because private ‘health markets’ are a prerequisite for the entry of foreign healthcare service providers. And TiSA contains a ‘ratchet’ clause that will lock in any privatisation of private healthcare provision – making it impossible to restore public control, even where private service delivery has failed. And TiSA will make it more difficult for the UK government to expand public services in future as those seeking to expand public services would be required to ‘compensate’ foreign commercial service providers and investors for loss of revenue.
There have been calls for public services to be excluded from the terms of TiSA. However, it’s been the case with other trade agreements that that, even where it appears that public services are exempt, they are not if there is any competition to supply services between public and commercial providers (as there is now in the NHS).
TiSA would prevent governments from imposing laws and regulations to protect public health (among other areas), and governments would be forced to allow transnational corporations to operate freely, even in situations where they may clearly endanger public health. Regulation would be restricted on service sectors at national, regional and local levels. The agreement has “standstill” clauses to freeze existing regulations and prevent the introduction of new ones, for example on technical standards or professional qualifications. This could mean that governments are no longer able to regulate staff-to-patient ratios.
TiSA will also reduce, if not remove, the ability of governments to regulate privately-delivered services and restrict governments’ ability to regulate key sectors such as telecommunications and cross-border data flows. For example, TiSA includes a prohibition on laws that require service providers to store data locally, which some countries have used to protect sensitive personal information, such as health data, from being snooped on if stored abroad.
It’s also expected that TISA will influence polices on the migration of health workers. It’s expected that commercial service providers would be free to ‘import’ health workers (generally as temporary contract labour hired at lower rates) from other countries. This could depress local wages and affect local employment. It would also add to a global crisis largely due to the migration of health workers from low and middle income countries.
Negotiations on TiSA began in 2013 and were expected to conclude in 2016. However, negotiations have stalled due to differences of opinion within the European Union and recent developments in the US. The election of Donald Trump creates problems for TiSA given that he appears critical of large multilateral trade deals. However, TiSA is about services and not industrial goods, and so it can’t be ruled out that, in time, the Trump administration will come to look on the treaty more favourably.
Should the US pull out of talks, it’s also possible that TiSA negotiations will continue under the leadership of the European Commission.