Tentative Celebration for TPP

June 25, 2015

After months of Washington brinkmanship, Congressional and Senate leaders in the US have at last given President Obama the “fast track” authority to achieve closure on the Trans-Pacific Partnership (TPP), an ambitious trade-liberalising agreement embracing 12 Asia-Pacific economies that has been at the heart of APEC trade liberalization activity for the past five years.
This agreement will break the debilitating 15-year logjam on trade liberalization created by failure to agree the WTO’s multilateral Doha Development Round, and may lay the foundation for other “mega-regional” trade agreements. Most ambitious of these would be the Free Trade Area of the Asia-Pacific (FTAAP) which began to take shape in APEC last year under China’s APEC Chairmanship.
Most participants in the TPP negotiations were withholding final endorsement until it was clear that Obama had the authority to commit the US to the deal. Many of the details of the TPP deal remain secret, but it is understood to be a “high quality” agreement that will have significant liberalizing impacts not just “at the border”, but behind the border in many economies. Several of the economies in the TPP – including Japan, Korea, Canada, Malaysia and Vietnam – face significant challenges in winning endorsement for the deal, in particular in areas like farm trade, treatment of state-connected enterprises, and privileges for indigenous majorities. Carve-outs or long-lead-in concessions may still paper over disagreements. But it now seems certain this significant deal can be sealed. As Americans might say, the fat lady has yet to sing, but we can now hear her practicing her chords back-stage… Some tentative celebrations are allowed.

Read Obama's long and winding road to a trade victory by Mr Patrick Low

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