Mexican addition to TPP talks opens way for NZ to jump NAFTA hurdle
By Paul McBeth
June 19 (BusinessDesk) - Mexico, the world's 13th biggest economy, has accepted an invitation to join regional trade negotiations including New Zealand and Australia in a deal that could free up market access that's been hindered by the 1994 North American Free Trade Agreement.
President Felipe Calderon and US President Barack Obama told media at the Group of 20 Nations leaders' summit that Mexico will join the nine countries holding Trans-Pacific Partnership talks after signalling its desire to join last November.
Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore, the US and Vietnam hope to create a free-trade block spanning the Asia-Pacific region that extends into aligning regulatory settings as well as removing tariffs and quotas.
The addition of Mexico means New Zealand may be able to eliminate trade barriers originating from NAFTA. New Zealand exports to Mexico were worth $116.2 million in the year-to-date and total sales of goods in 2011 were $414 million.
"The current TPP members particularly welcomed Mexico’s commitment to achieving the shared goal of a comprehensive, high-ambition, next-generation agreement as rapidly as possible, consistent with the statements made by TPP leaders and trade ministers on 12 November 2011 in Honolulu," New Zealand Trade Minister Tim Groser said in a statement.
The TPP negotiations, which grew from New Zealand’s P4 deal with Chile, Brunei and Singapore, have been widely opposed by anti-globalisation activists and academics over intellectual property demands made by the US and provisions that would let companies sue governments if policy decisions erode their profits.
Obama said both Mexico and the US recognise growth is taking place in the Asia Pacific region and they need to be part of that network of nations.
"To be able to create a high standard trade agreement that further increases job opportunities, commercial opportunities, investment opportunities, I think will benefit citizens in both our countries that are eager to compete and to be able to prosper in a global market," he said.
In a submission on opening up TPP negotiations to Mexico, Japan and Canada, Business New Zealand said letting Mexico join the TPP negotiations "offers considerable opportunity for New Zealand exporters" by restoring access to a market that cut out a number of local companies after the introduction of NAFTA.
In putting its case to New Zealand, Mexican trade official Rosaura Castaneda Ramirez said the central American nation's growth prospects made it an attractive addition to join the negotiations, and that its experience with NAFTA meant it was willing and able to implement a "next generation agenda" for trade talks.
"TPP is a renewed opportunity to institutionalise the important bilateral economic relationship between Mexico and New Zealand," Ramirez said. "