Saturday

20th Jul 2019

Opinion

EU-Vietnam trade deal a bad day for workers' rights

  • Shoes, some made in Vietnam, on sale in the EU. There is not a single independent trade union in Vietnam (Photo: EUobserver)

Behind the smiles and handshakes, the signature of the EU-Vietnam trade and investment deals - being agreed on Tuesday (25 June) and to be signed at the end of this week - have dire consequences for human well-being and our ability to prevent climate and ecological breakdown.

The deals bear all the hallmarks of the ones with the USA and Canada that caused so much public outcry a few short years ago, but with a twist.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

Once again, the inclusion of an Investor-State Dispute Settlement (ISDS) system threatens public budgets and put social and environmental protections are under threat.

But this time, the EU is salting the wound by pushing these corporate courts on a country where citizens have precious few rights in the first place – there is not a single independent trade union in Vietnam.

Meanwhile, freedom of speech could barely be more curtailed – it ranks fifth-last on the World Press Freedom Index, ahead of only China, North Korea, Turkmenistan and Eritrea.

The Vietnamese experience with investment deals and the ISDS system shows that this deal can be used by foreign investors to sue the country's government and empty its public coffers.

ISDS has already been used by two oil firms to avoid paying taxes in the country.

In this lawsuit, one of the eight current ISDS cases against Vietnam, two companies are suing the Vietnamese government for receiving a tax bill after the takeover of one company (ConocoPhillips Vietnam) by another (Perenco).

ConocoPhillips made a profit of $896m [€787m] on this sale, and refuses to pay taxes on this gain.

This pattern is also replicated elsewhere around the world, where these courts have been used to trample on democracy and suck public money into private accounts.

In Dubrovnik, a majority of local citizens rejected a massive tourism project, which ended up being upheld by national courts.

So far, so good – but it quickly turned into an ISDS nightmare via a Netherlands-Croatia investment treaty: the locals are now being pursued for voicing their opposition and Elitech and Razvo, the two foreign investors, are suing the Croatian government for €500m to compensate for a project that never got off the ground.

ISDS is so powerful that it can also deter much-needed government action to regulate in the public interest, such as in France, when the Canadian oil company Vermilion managed to water down a climate change law by threatening an ISDS case, or in Colombia on access to medicine for cancer patients.

One-way justice?

One of the most fundamental problems with ISDS is that it is a one-way system that only provides rights to investors, with no corresponding obligations to support the public interest.

Affected communities cannot use it to sue companies that violate their human rights or cause them financial or other damages, and nor are they allowed to have a voice during ISDS cases brought against governments.

These grave injustices have not changed how the EU approaches investor privileges in trade deals. Despite public outcry across Europe – over half a million people have signed a petition to stop ISDS in EU trade deals – when the EU revised its approach to ISDS in 2016, very little had changed.

This updated version of ISDS, the Investment Court System (ICS), remains a parallel justice system for rich individuals and corporations to circumvent domestic courts and demand huge sums of money in compensation from governments.

It contains no obligations for EU corporations in Vietnam to respect human rights.

EU officials might affirm they aim to foster sustainable development in Vietnam but the reality behind those words is that they foster corporate greed.

While their leaders congratulate themselves on a done deal, European and Vietnamese citizens should not lose sight of the real winners of this investment agreement: big business and rich individuals, whom the EU enables to hijack justice and democracy for their profits.

Author bio

Lora Verheecke is a trade and investment researcher and campaigner at Friends of the Earth Europe. She has been working for several years on how EU trade deals impact on democracy and the environment.

Disclaimer

The views expressed in this opinion piece are the author's, not those of EUobserver.

EU sacrifices human rights for Vietnam free trade

The deal signed by the European Commission despite reports of violation of human rights and an EU Ombusdman warning should include a suspension clause if the situation persists.

Six takeaways on digital disinformation at EU elections

For example, Germany's primetime TV news reported that 47 percent of political social media discussions were related to the extreme-right AfD party, when in fact this was the case only for Twitter - used by only four percent of Germans.

Stakeholders' Highlights

  1. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  2. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues
  3. Nordic Council of MinistersNo evidence that social media are harmful to young people
  4. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  5. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  6. Nordic Council of MinistersEducation gets refugees into work
  7. Counter BalanceSign the petition to help reform the EU’s Bank
  8. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  9. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  10. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  11. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat
  12. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North

Latest News

  1. EU goes on holiday as new UK PM arrives This WEEK
  2. Survey: Half of EU staff 'don't know' ethics rules
  3. Von der Leyen signals soft touch on migrants, rule of law
  4. Timmermans: von der Leyen will be tough on rule of law
  5. Timmermans trolls 'idiot' Brexit negotiators
  6. Rudderless Europe: Will real Germany please stand up?
  7. PiS & Fidesz claim credit for von der Leyen victory
  8. Von der Leyen faces gender battle for commission posts

Stakeholders' Highlights

  1. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  2. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  3. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  4. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  5. Nordic Council of MinistersNordic commitment to driving global gender equality
  6. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  7. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  8. Nordic Council of MinistersNordic talks on parental leave at the UN
  9. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  10. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  11. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID
  12. Counter BalanceEU bank urged to free itself from fossil fuels and take climate leadership

Join EUobserver

Support quality EU news

Join us