US, Japan and 10 other Pacific Rim countries signed Trans-Pacific Partnership agreement
The 10 other countries of the Pacific Rim which signed the agreement are Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
The United States (US), Japan and 10 other Pacific Rim countries on 5 October 2015 signed the Trans-Pacific Partnership (TPP) agreement to lower trade barriers, bolster worker protections and set standards for a raft of other industries.
The TPP is designed to facilitate trade among the US and a host of other countries scattered across both sides of the Pacific Ocean.
The 10 other countries of the Pacific Rim which signed the agreement are Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. China, the world's second-largest economy, is not part of the agreement.
This TPP agreement encompassing nearly 40 percent of the world economy will now have to be ratified by the lawmakers of each country.
What will TPP do?
• It cuts trade tariffs and sets common standards in trade for 12 Pacific-rim countries, including the US and Japan.
• The partnership eliminates more than 18000 taxes that various countries put on made-in-America goods; this will level the playing field for farmers, ranchers and manufacturers.
• The TPP deal also sets minimum standards on issues ranging from workers’ rights to environmental protection.
• It also sets up dispute settlement guidelines between governments and foreign investors separate from national courts.
• Unfortunately, the TPP will not create jobs. While the administration touts the TPP as a job-creating, wage-raising enterprise, but it has not made public any employment or sectoral impacts study.
Overall Benefits of TPP
• Includes the Strongest Worker Protections of Any Trade Agreement in History
• Includes the Strongest Environmental Protections of Any Trade Agreement in History
• Helps Small Businesses Benefit from Global Trade
• Promotes E-Commerce, Protects Digital Freedom, and Preserves an Open Internet
• Levels the Playing Field for US Workers by Disciplining State-Owned Enterprises (SOEs)
• Prioritizes Good Governance and Fighting Corruption
• Includes First Ever Development Chapter
• Capitalizes on America’s Position as the World Leader in Services Exports
How TPP Upgrades NAFTA?
The past trade deals including the North American Free Trade Agreement (NAFTA) have not always lived up to the expectations. The TPP improves substantially on NAFTA’s shortcomings, it delivers on that promise. TPP upgrades existing standards and sets new standards that reflect today’s economic realities:
• It adopts highest environmental standards of any trade agreement.
• It adopts the highest labor standards, including fully-enforceable requirements to protect the freedom to form unions and bargain collectively.
• It includes the first-ever measures to ensure that state-owned enterprises compete on a commercial basis.
• It sets the standards to protect digital freedom, by preserving the free flow of information across borders.
• It improves protections for 40 million American workers whose jobs depend on innovation.
Why was the TPP deal controversial?
The TPP deal has been controversial because of the secret negotiations that have shaped it over the past five years and the perceived threat to an array of interest groups from Mexican auto workers to Canadian dairy farmers.
Although the complex deal sets tariff reduction schedules on hundreds of imported items from pork and beef in Japan to pickup trucks in the United States, one issue that has been controversial is the minimum period of protection of the rights to data used to make biological drugs by companies.
A politically charged set of issues surrounding protections for dairy farmers was also addressed. New Zealand, home to the world’s biggest dairy exporter wanted increased access to US, Canadian and Japanese markets.
Separately, the United States, Mexico, Canada and Japan also agreed rules governing the auto trade that dictate how much of a vehicle must be made within the TPP region in order to qualify for duty-free status.
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