The Trans-Pacific Partnership (TPP) has gained even more momentum as the 12 participating countries gathered in New Zealand to sign the agreement today (2/4/2016). This however, does not mean the fight is over for the controversial trade agreement, the individual governments need to first pass the legislation through their own domestic political processes before it can take effect.
This new trade deal includes the US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.
These 12 countries are responsible for over 40% of the global economy and the TPP will bring them all closer than ever before.
The Trans-Pacific Partnership largely focuses on eliminating tariffs and other barriers that reduce the incentive to import/export from these countries. Most notably, the trade deal does not include China, which is working on their own trade deals to compete with the TPP.
The US largely agrees that the TPP will help them get a better handle on global trade.
“TPP allows America—and not countries like China—to write the rules of the road in the 21st century,” US President Barack Obama said after the pact was signed in New Zealand. (http://onforb.es/1mgihbe)
Even though the leaders of the 12 nations agreed to the terms in the lengthy TPP agreement, many Americans still oppose the trade deal, stating that an open trade pact between these countries will accelerate the loss of American jobs to foreign competitors. This is not their only concern, it has been said that a large majority of the document focuses on protecting corporation’s intellectual properties rights, and does not focus enough on benefiting domestic businesses.
At the signing, protesters gathered outside the hall where it was taking place to voice their concern over the potential impact of the trade deal, even blocking off roads to disrupt the event.
President Obama and the other partnering governments are trying to ensure that the TPP will boost the economy of all the nations included and help them compete with China as well.
“TPP allows America – and not countries like China – to write the rules of the road in the 21st Century, which is especially important in a region as dynamic as the Asia-Pacific,” President Obama said.
Other government officials expressed their ardor for the legislation. The United States Trade Representative Michael Froman stated “that the deal could add $100bn a year to US growth”. (http://bbc.in/1meWEId)
If the TPP can truly provide this kind of economic growth and benefit all the countries involved, it will be a fantastic piece of legislation for the global economy as a whole. Still, the trade agreement still needs to pass through all the countries’ domestic political processes, but for the US, it looks as though there is enough support to pass it through. Only time will tell what the outcome will be, and if the TPP can offer American businesses all of the benefits government officials are promising.