US likely to force pace on TPP with fast track in place
By Pattrick Smellie
June 24 (BusinessDesk) - The United States is likely to try and force the pace of negotiations to conclude the Trans-Pacific Partnership in the next few weeks, following a vote in the US Senate last night that all but ensures President Barack Obama will gain so-called 'fast track' authority to complete the controversial agreement.
One more Senate vote is expected overnight tonight, New Zealand time, to confirm Trade Promotion Authority - an essential component to resuming the 12 nation talks that have been stalled for months while Obama cobbled together a coalition of Democrats and Republicans large enough to support the measure.
TPA, or fast track authority, means the president can take a trade deal to Congress for a so-called 'up or down' vote, which can only accept or reject the deal, not alter it.
Two of the largest participants in the negotiations, Canada and Japan, had insisted on fast track being in place before they would attempt a final agreement.
However, with next year's US presidential election expected to complicate any TPP conclusion, intense pressure is expected to try for a conclusion before the US political summer recess, in August.
"The hoop-la at TPA masks a broader set of issues around the negotiation itself," the Auckland-based executive director of the International Business Forum and former trade negotiator, Stephen Jacobi, told BusinessDesk, following comments from Trade Minister Tim Groser last week that there is still "no deal" on dairy products, the most important issue for New Zealand, which wants market access to the heavily protected US, Canadian, and Japanese markets.
"From what we can deduce there is no deal on dairy, but it’s not just dairy," said Jacobi. "It’s on a range of other sensitive market access issues. I think one could be skeptical about whether that could be rammed through in a short period.
He said the US would argue: "We’ve got this (fast track) through, we’ve just got to do this (TPP) now, so here it is, that’s what it’s going to be; and I’m afraid the other 11, or 10 assuming Japan is on their side, have basically got to say ‘well, get stuffed, you can’t take all year to get your own house in order and then expect us to make a deal in five minutes’."
"I’m not saying TPP is going to collapse, just that there’s more time required," Jacobi said. "Remember the vast majority of the TPP membership are ones that want market access and they’re exactly the same ones as will be pushed by the US particularly in some of the rules areas, so until they can see an overall benefit themselves, they’re not going to swallow potentially difficult policy decisions back home."
The fast track developments coincide with the release of new polling from the US-based Pew Research Center from nine of the 12 TPP countries, showing relatively high support for the deal, with the strongest expectation that TPP would be a "good thing for our country" in Vietnam, Peru and Chile, where 89 percent, 70 percent and 67 percent respectively supported the deal, against 2 percent, 12 percent and 8 percent who did not. The remainders either did not know enough or had not heard of TPP.
New Zealand was not among the countries surveyed. The Pew Center continually runs surveys in 64 countries, at sample sizes of 1,000 or larger.
The results for the US showed 49 percent thought TPP would be "good for our country", while 29 percent did not, with greater support among young people. In Australia, 62 percent thought it would be "a good thing for our country", while 30 percent did not. Japanese opinion ran 53 percent in favour, 24 percent against.
An Ipsos poll in New Zealand, published in December 2012, found high levels of public antipathy to the secrecy surrounding the negotiations and fears about the future of the drug-buying agency, Pharmac.
One of TPP's most vocal New Zealand critics, Professor Jane Kelsey from the University of Auckland law school, said the success of the fast track initiative was the result of "unprecedented procedural machinations and an unholy alliance with the Republicans" that would cause potentially "irrecoverable" harm to Obama's relationship with the Democratic Party.
"The Republicans will now extract their pound of flesh on behalf of their corporate sponsors and local constituencies. We can expect even more intense pressure to deliver to Big Phrma, demands for more radical restrictions on state-owned enterprises, and renewed pressure to include rules against so-called currency manipulation.," she said in a statement.