Vietnam and the Trans-Pacific Partnership

I am deeply concerned with the lack of basic rights, freedoms, and working conditions in Vietnam. I often hear from my constituents about Vietnamese nationals who have been wrongfully imprisoned in Vietnam because they spoke out for better working conditions, or for the right to freely exercise their religion.

It is my view that the Bipartisan Congressional Trade Priorities and Accountability (TPA) Act and the Trans-Pacific Partnership (TPP) should not advance without enforceable human rights provisions and enforceable international labor standards that crack down on Vietnam's disturbing record on human rights.

Take my survey on the Trans-Pacific Partnership:

As you may know, the United States has negotiated a trade agreement among 12 Asia-Pacific countries called the Trans-Pacific Partnership (TPP). The stated goal of the agreement is to eliminate trade barriers and establish new trade rules among partner countries, including the United States and Vietnam.

It is not without controversy. Some backers of the agreement, including some business groups, believe it will help developing countries grow their economies while fostering stronger U.S. relations in Asia. On the other hand, some labor and civil rights groups have strong concerns that worker rights provisions in the agreement are too weak or unenforceable, and that it would outsource U.S. jobs to countries with poor protections for workers, like Brunei, Malaysia, Mexico, and Vietnam. 

As Chair of the Congressional Caucus on Vietnam and as an elected Representative of the largest Vietnamese community in the U.S., I am deeply concerned about human rights in Vietnam. I have pledged to my constituents that if the agreement does not include meaningful, enforceable improvements in human rights in Vietnam, I will not support it. 

I would like your opinion. Below, I’ve included information about the agreement, viewpoints from organizations and agencies both opposed to and in favor of the agreement, as well as a link to the full text of the agreement and the side letter between the U.S. and Vietnam. 

Introduction to the TPP 

The TPP reduces restrictions on the trade of goods and services and sets rules on many trade-related issues, including intellectual property rights, regulatory issues, labor, and environmental standards among 12 Asia-Pacific countries.

These countries include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam, which together make up 40% of the world economy. 

The TPP was signed on February 4, 2016 after several years of negotiations. Congress must still vote to affirm the agreement for it to go into effect. It is currently expected this vote may happen after the November election but before the end of 2016.

If the agreement goes into effect, it would be the largest Free Trade Agreement in which the U.S. participates. The agreement would ease trade and establish new rules on a range of issues not found in previous U.S. Free Trade Agreements or prescribed by the World Trade Organization. 

Lowering Barriers to Trade

If the TPP were implemented, trade with countries where the U.S. does not already have a free trade agreement would be 80% duty-free within the first three years and 90% duty free by the tenth year. 

More than 99% of exports would eventually be duty-free in Brunei, New Zealand and Malaysia, while Japan and Vietnam would maintain some level of tariff protection on about 1% of their products. In Vietnam, approximately 200 products, mostly agricultural products like sugar, in addition to other items like used automobiles, would maintain some level of tariff protection. More than 400 Japanese products comprised mostly of agricultural goods, including pork, as well as some footwear would retain trade protections.

In return for relaxing their trade barriers, the TPP would eventually allow these countries to import more than 99% of all U.S. goods duty-free.

USTR Fact Sheet on the economic benefits of the TPP

Bloomberg: The Biggest Winner From TPP Trade Deal May Be Vietnam

Labor Rights

All TPP member countries are required to have laws that are in line with internationally recognized labor standards. They must allow employees to form unions and collectively bargain. They are prohibited from allowing forced or child labor, and must eliminate workplace discrimination. However, some question the enforceability of these provisions.

The TPP is the first U.S. Free Trade Agreement to include a communist country – Vietnam. The U.S. and Vietnam signed a separate agreement that is essential to ensure that Vietnam would be in compliance with TPP’s labor obligations and to provide a clear framework for how Vietnam must reform its laws and practices. In this agreement, Vietnam made only the following commitments: 
  • workers will be allowed to form unions, without approval from the government, and with their own independently elected representatives 
  • the government will not pass laws requiring labor unions to register 
  • the government will not allow employer interference with labor unions 
  • employees will have the right to strike
  • employees will have an effective complaint mechanism to inform authorities confidentially and anonymously of alleged labor violations
  • the government will allocate sufficient resources to enforce labor laws 


The agreement states that Vietnam make these changes by the time the TPP goes into effect, with one significant exception. The exception applies to the commitment to allow unions to be allowed to affiliate with each other across an industry, such as the individual textile unions joining together to form a larger textile worker union. The agreement requires Vietnam to implement this change within five years of the TPP’s effective date. 

The agreement provides that if Vietnam does not meet these labor commitments by the fifth year of the agreement, the U.S. may stop further reductions or eliminations of duties on goods. To maintain leverage and ensure Vietnam’s compliance with the final and important labor rights obligation to allow enterprise-level unions, reductions or eliminations of duties on many of the products important to Vietnam, including textile, apparel, and footwear, will not take effect until the 6th, 7th, 11th, or 13th year of the agreement. However, there is no requirement that the U.S. take any action if Vietnam fails in it’s obligations.

USTR Fact Sheet: Protecting Workers

Human Rights Watch: What are the primary labor rights issues?

Access to Open Internet

While the TPP mentions the importance of unrestricted, open access to the internet, this provision is unenforceable. The TPP does not protect everyday internet users or guarantee their right to freely access information and services.

USTR Fact Sheet: Ensuring a Free and Open Internet

Electronic Frontier Foundation: The Trans-Pacific Partnership

Digital Trade and Cross-Border Data Flows

TPP prohibits restrictions on cross-border data flows and data localization requirements, except for financial services and government procurement. It also generally prohibits requirements for source code and technology disclosure or transfer as a condition for market access. 

Enforcing the Agreement

There are two ways to seek enforcement of the TPP agreement, state dispute settlement procedures, and investor state dispute settlements. These two mechanisms will be available to enforce the commitments in the TPP itself, but not the side agreements between the U.S., Vietnam, Malaysia, and Brunei.

1. State Dispute Settlement Procedures

Each country may make use of what is known as a “dispute settlement procedure.” These dispute settlement procedures require the countries involved to consult with each other to see if they can come to an agreement. If that is not successful, then the two countries who disagree with each other will meet with a third partner country, which acts as a mediator. If still no agreement is reached, a “dispute settlement panel” will be established. This panel is made up of one country chosen by each of the parties who are in disagreement over the terms of the TPP, as well as one neutral country chosen by both parties. Once this panel reaches a determination, the country found at fault in the dispute is expected to correct its behavior. If it does not, that country may have to pay a fine or have the benefits it had achieved as a result of the TPP suspended. This process is time consuming and relies on national governments to initiate enforcement action.

2. Investor State Dispute Settlements

The second way in which enforcement is sought is a process called “investor state dispute settlement.” This allows private companies – corporations that engage in trade among the participating countries – to file a lawsuit against another participating country that they feel are not following the rules. However, these investors cannot bring suits to enforce the labor or environmental commitments TPP partners have made. It is unclear how long this process would take, and while the process continues, the trade agreement would remain in effect. Human rights or labor rights organizations are not permitted to seek enforcement in this way. 

USTR: Dispute Settlement

Human Rights Watch: What would a more human rights-friendly TPP look like?

Questions:

From the beginning, I’ve stated that any trade agreement with Vietnam as a party must include meaningful and enforceable measures to improve human rights and Internet freedom. Given that Vietnam lacks independent courts and prosecutors, or a free press and civil society to investigate violations or enforce the laws, I have also advocated for all TPP measures to be fully enforceable with the ability of nongovernmental actors to initiate enforcement actions adjudicated outside of the Communist-controlled court system. 

In the past Vietnam has often regressed from political liberalization as soon as it gains preferential trade status. In 2007, after the United States lifted its long-standing objection to Vietnam’s membership in the World Trade Organization, Hanoi responded by launching the first of three waves of arrests that jailed more than 100 dissidents and introduced sweeping new laws restricting freedom of association, assembly and the Internet. After achieving WTO membership the Communist government in Vietnam still had free license to jail, torture and abuse.

Today, I want your opinion. I will not support any agreement that does not make meaningful, enforceable improvements for human rights in Vietnam.


Link to full TPP Agreement Text

Link to Labor Implementation Plan Agreement Between U.S. and Vietnam

Sincerely,
Zoe Lofgren



Below are some resources you may find useful or interesting as this debate unfolds: