Thursday, February 4, 2016

TPP nations ink deal in Auckland; focus shifts to ratification by legislators

AUCKLAND – Twelve Pacific Rim countries — representing around 40 percent of the world economy — signed the Trans-Pacific Partnership free trade deal on Thursday in a ceremony in Auckland, calling the pact a “historic achievement” for the region.

Japan, the United States, New Zealand and nine other countries will remove or lower tariffs and introduce unified international trade and investment rules under the text agreed last October.

“After more than five years of negotiations, we are honored to be able to formalize our collective agreement,” trade ministers of the 12 countries said in a statement.


The focus now shifts to ratification by the nations’ legislatures, the final hurdle before it takes effect.

The agreement enters into force 60 days after all 12 countries ratify it, if they do so within two years.

If it drags on for longer, it will take effect 60 days after at least six countries, accounting for 85 percent of the combined gross domestic product of the 12 signatories, ratify it.

A range of obstacles stand in the way, meaning the deal is unlikely to enter into force before 2018.

In the United States, lawmakers are unlikely to debate the pact before the presidential election in November, given that leading Democratic and Republican presidential candidates are opposed to the deal.

U.S. Trade Representative Michael Froman told a news conference in Auckland on Thursday that discussions with U.S. lawmakers on the trade accord are underway and he is “confident” that Congress will provide the necessary support for its approval.

Froman said he is “educating everybody what is in the agreement and addressing their questions and concerns.”

The Japanese government, meanwhile, aims to submit a bill to the Diet promptly for ratification, Shuichi Takatori, senior vice minister of the Cabinet Office, told the same news conference.

Speaking to reporters in Tokyo the same day, Prime Minister Shinzo Abe expressed hope that the signing of the pact will “lead to Japan’s growth and wealth for the people.”

Takatori was the official assigned to sign the treaty after Akira Amari, who led negotiations, resigned as economy minister last week amid a funds scandal.

New Zealand Prime Minister John Key called for ratification to make the fruits of the pact a reality. “Signature today is an important step but TPP is still just a piece of paper,” he told the news conference.

The signing ceremony took place on the second day of the ministers’ meeting in Auckland.
The 12 countries are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.

Other Asian economies, including Indonesia, South Korea, the Philippines, Taiwan and Thailand, have shown interest in joining the group.

“We recognize the interest shown by a number of other economies throughout the region. This interest affirms our shared objective, through TPP, of creating a platform that promotes high standards for broader economic integration in the future,” the ministers said.



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