Welcome interim trade move
New Zealand joining 15 other World Trade Organisation members to set up interim arrangements to solve trade disputes is a welcome step, says the NZ International Business Forum.
The executive director of New Zealand International Business Forum, Stephen Jacobi, told Rural News that negotiators have a six-month opportunity to hammer out a deal.
Jacobi, who attended this month’s APEC summit in Beijing, says there is a risk that if TPP is not concluded soon people will get bored and even walk away.
“We have six months until the next presidential election gears up in the US – that’s the window we’re working with,” Jacobi says.
Leaders involved in TPP, including Prime Minster John Key, met on the sidelines of APEC. Key believes leaders have momentum and a desire to complete TPP but have only until August 2015 to reach a deal. Failing this, the TPP would be put on the backburner for a couple of years at least.
Key referred to strong desire among the leaders of the 12 TPP countries to complete the deadlocked talks. But he warned an agreement was needed by August 2015 or it will be too close to the next US presidential election in 2016 to get anything done.
Jacobi agrees the 12 TPP countries have moved further but how far remains to be seen.
He believes the key is the US and Japan reaching agreement on their market access package. “Until they do this and make that available to the other nine, I do not think we can conclude this agreement.”
President Barack Obama is adamant the deal would be done and has promised to keep working on it.
“I met with several other members of the TPP who share my desire to make this agreement a reality and we are going to keep working to get it done,” Obama said in a speech to a business summit related to APEC.
“Once complete, this partnership will bring nearly 40% of the global economy under an agreement. That means increased trade, greater investment and more jobs for its member countries, a level playing field on which its businesses can compete, and high standards that protect workers, the environment and intellectual property.”
But there are questions over Obama’s ability to get a deal through the Congress; the Senate falls into Republican control from January.
Jacobi says the US mid-term elections pave the way for the incoming Republican leadership of both houses to draw up an ambitious negotiating mandate for Obama.
This would allow him to commit seriously to the negotiation, he says.
“That has been a problem until now: the US has been negotiating but it has been unclear what their bottom line is.
“This is particularly important for the negotiation with Japan. There is some possibility that the Trade Promotion Authority can be passed in the lame duck session in the coming month but I think it more likely this will happen in February.”
