While efforts to complete the TransPacific Partnership (TPP) trade agreement closed Friday in Hawaii without a final deal, the TPP ministers are “are more confident than ever that TPP is within reach and will support jobs and economic growth.”
The California Chamber of Commerce-supported trade agreement is an important vehicle for economic integration throughout the Pacific. This regional agreement sets a high standard that will enhance the competitive of the countries that are a part of it, helping facilitate trade and promoting investment between participants in the agreement, increasing their economic growth and development.
Significant Progress Made
The TPP ministers stated that they have made significant progress and will continue work on resolving a limited number of remaining issues, paving the way for the conclusion of the Trans-Pacific Partnership negotiations.
Some of the unresolved issues included deep differences over trade in dairy and other products.
The Wall Street Journal reports that U.S. and Canadian officials have quarreled in recent months about ways to use the agreement to open up Canada’s highly protected dairy industry, but the public dispute this week spread to three of the other developed economies negotiating the agreement—Australia, Japan and New Zealand. The gap over dairy, as well as disagreements about trade in automobiles, hindered the efforts of ministers to reach an accord on other issues, such as labor rules and the level of intellectual property protection for pharmaceuticals, a priority for Washington.
According to the U.S. Chamber of Commerce, additional market access offers have been exchanged in bilateral meetings between ministers, a process that is testing the level of ambition of the overall agreement. Disagreement has centered on dairy, sugar and autos, and Australia, New Zealand, and Mexico have all signaled significant dissatisfaction with what has been proposed. This ongoing focus on market access seems to have delayed progress in important rules areas—particularly intellectual property.
As reported by NPR, however, because no agreement has been reached, it’s unlikely that the U.S. Congress will be able to vote on the trade pact this year. That will push a vote into 2016 — when the presidential election will be in full swing, and when President Barack Obama will be less than a year from leaving office.
Leaders of the current 12 Trans-Pacific Partnership economies—Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam—have announced the broad outlines of an ambitious, high-standard, regional, 21st century Trans-Pacific Partnership Trade Agreement, of which the CalChamber is supportive.
According to a 2013 analysis supported by the Peterson Institute, a TPP agreement provides global income benefits of an estimated $223 billion per year, by 2025. Real income benefits to the United States are an estimated $77 billion per year. The TPP could generate an estimated $305 billion in additional world exports per year by 2025, including an additional $123.5 billion in U.S. exports.
The market size is nearly 800 million consumers with a combined gross domestic product (GDP) of $28.1 trillion in 2012 (39% of world GDP). In 2013, U.S. exports with the TPP members topped $699 billion and California exports were approximately $70.4 billion, according to the U.S. Department of Commerce.
Moreover, the Trans-Pacific Partnership is reinforcing the Asia-Pacific Economic Cooperation goal of promoting regional economic integration and could serve as a potential way to build toward the Free Trade Area of the Asia-Pacific.
For more information, visit www.calchamber.com/TPP
Staff Contact: Susanne T. Stirling