On Monday, the Trans-Pacific Partnership (TPP), which is a trade agreement between several Pacific Rim nations, has struck a tentative deal that aims to sharply reduced if not eliminate most tariffs in a region comprising about 40 percent of the global economy, The Globe and Mail revealed. The deal was signed after five days of negotiations in Atlanta, U.S.A.
Aside from reducing trade barriers such as tariffs, the Trans-Pacific Partnership also seeks to establish a common framework for intellectual property, enforce standards for labor law and environmental law as well as establish an investor-state dispute settlement mechanism. According to The Vancouver Sun, 12 Pacific Rim countries including U.S., Japan, Malaysia, Vietnam, Singapore, Brunei, Chile, Peru, Australia, New Zealand, Mexico and Canada, are all part of the deal.
Unfortunately, the world's largest economy, China, is not part of the agreement, as well as other big countries in Asia such as Indonesia, South Korea, Thailand and the Philippines. But South Korea, east Asia's third biggest economy, has signaled it may eventually join the TPP deal.
"[The agreement] is to enhance trade and investment among the TPP partner countries, to promote innovation, economic growth and development, and to support the creation and retention of jobs," the five-year in the making Trans-Pacific Partnership's goal stated.
Despite the celebratory mood around the negotiating table in Atlanta, implementing the Trans-Pacific Partnership deal could take a while since all 12 nations must ratify a final legal text, which hasn't been drafted yet. Pushing the agreement through the Republican-held U.S. Congress could also be particularly tricky, with just over a year before the next election.
Several groups have also opposed the plan. Bloomberg reported the opposition comes from companies and industries that aren't getting the protections they sought, as well as labor groups who say the accord will safeguard corporate profits at the expense of workers.
Furthermore, as developing nations sought quicker access to generic medications, the biotech industry also spoke out against the TPP plan for failing to grant companies a long enough exclusivity period for biologic drugs, which are derived from living organisms.
Meanwhile, labor groups said the TPP deal will send jobs out of the U.S. as previous trade accords have done. Communications Workers of America President Chris Shelton even called the treaty as "a bad deal for working families and communities.
The Trans-Pacific Partnership agreement will be the biggest trade deal the U.S. has negotiated since the 1994 North American Free Trade Agreement, under Democrat President Bill Clinton. And since politicians are weighing in the cons, the trade pact will definitely have a rough ride in Congress.
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