Nearly eight years after Pacific Rim countries gathered to discuss what could be the largest international trade accord in history, they have come to an agreement. Now, the Trans Pacific Partnership moves to what is likely to be an arduous stretch in a divided U.S. Congress.
Negotiators recently gathered in Atlanta, Ga., for another attempt at completing the massive free trade agreement after they failed to reach a deal during a round of discussions in Hawaii.Through five days of talks, representatives from 12 nations hashed out differences on dairy products, automobile parts and drug patents, among other things, in an effort to complete the Pacific free trade deal. The agreement, should it be approved, would bring together 40 percent of the world's economy. A finished and approved deal would also further a U.S. pivot toward Asia, an initiative U.S. President Barack Obama has pushed during his tenure in office.
"This partnership levels the playing field for our farmers, ranchers and manufacturers by eliminating more than 18,000 taxes that various countries put on our products," Obama explained in a statement on Monday. "It's an agreement that puts American workers first and will help middle-class families get ahead."
Countries work out disagreements in Atlanta
However, U.S. politics will likely prove the next major roadblock for the slow-moving, obstacle-laden trade deal. A Congress divided along partisan lines and the presidential election cycle are expected to amplify disagreements about whether the TPP will be good for the U.S. Obama will find unlikely allies in Republicans who support the free trade deal, and will find himself defending the TPP against members of his own party, organized labor groups and civic organizations.
Numerous disagreements were worked out over five days of intensive negotiations. For example, Australia and the U.S. were able to come to an agreement on drug patents – one of the numerous issues that had stalled previous discussions, the Wall Street Journal explained. The U.S. had hoped for up to 12 years of protection for biologic drugs against generic imitators. The two countries came to an agreement that will set protections at anywhere from five to eight years of exclusivity.
Canada and Japan also agreed to improve access to their dairy markets, both of which are strictly regulated. The U.S. will also allow New Zealand, the world's largest exporter of dairy products, to export more of such goods into the States.
For the agreements above and many others, countries had to tip-toe a fine line between the demands of domestic business groups and those of other nations involved in the discussions. Portions of the deal are especially sensitive subjects in the U.S. and Canada, each in the midst of their own election cycles.
TPP approval process presents new obstacles
The TPP includes provisions that will likely leave lawmakers on both sides of the aisle in the U.S. bristling. Some Democrats and organizations supporting generic drugs, for example, had hopes for biologic drug exclusivity terms shorter than five years, according to the Wall Street Journal. Many Republicans, meanwhile, oppose portions of the agreement that would strengthen labor groups, hinder tobacco companies' efforts to fight against packaging regulations and potentially harm local industries including dairy and sugar.
"The intense national battle over trade authority was just a preview of the massive opposition the TPP [Trans-Pacific Partnership] will face given that Democratic and GOP members of Congress, and the public soon will be able to see the specific TPP terms that threaten their interests," Lori Wallach, director of Public Citizen's global trade program, told the Los Angeles Times.
It's not just politicians who are skeptical of the completed trade agreement. Labor organizations, such as the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), are expected to attempt to pressure Congress into rejecting the free trade accord. Ford Motor Co. also opposed the TPP, due to the fact that it doesn't address currency manipulation overseas. Ziad Ojakli, Ford's group vice president for government and community relations, asked that the administration continue negotiations in an effort to work out stronger currency rules.
"The only way for this to end well for the American people, and our economy, is for Congress to reject this awful agreement, lock it in a metal safe and dump it at the bottom of the Pacific Ocean," said Charles Chamberlain, Executive Director of Democracy for America, according to Bloomberg.
Though completed, the TPP still faces a lengthy debate in the U.S. as politicians opposed to the trade deal and emboldened by the election cycle lash out against the agreement. However, negotiators can at the very least take solace in the fact that close to eight years of discussions have reached an end, and the TPP is now set to move onto a new battleground.