TPPTrans-Pacific Partnership

MUHAMMAD KHANSABEEH-UR-REHMAN

TPP (Trans-Pacific Partnership):

The Trans-Pacific Partnership (TPP) is a trade agreement among twelve Pacific Rim countries concerning a variety of matters of economic policy, which was reached on 5 October 2015 after 7 years of negotiations. 

Historically, the TPP is an expansion of the Pacific-4, which was signed by Brunei, Chile, New Zealand, and Singapore in 2005

TPP Participants 2015: Accounts for 40% of World’s GDP

The TPP agreement includes: Tariffs & other barriers:

The agreement would reduce 18,000 tariffs on different products. Tariffs on all U.S. manufactured goods and almost all U.S. farm products would be eliminated completely, with most eliminations occurring immediately.

Intellectual property provisions:Making available is the exclusive right of the copyright owner. Copyright is granted at a length of life of author plus 70 years.

Patent Extensions:Extend Patents by 5-10 years to encourage investments in R&D in

Pharmaceutical industry and Bio-Technological industry.

Investor–state settlement: 

Countries would be required to conform their domestic laws and regulations to the TPP Agreement.

Countries would be required to pursue an investor-state dispute settlement mechanism, also known as corporate tribunals.

Grants an investor the right to initiate dispute settlement proceedings against a foreign government in TPP tribunals under international law.

 WikiLeaks released a draft of the TPP's Investment according to which global corporations could sue governments in tribunals organized by the World Bank or the United Nations to obtain compensation from them for loss of expected future profits due to government actions.

KEY FEATURES:Five defining features make the Trans-Pacific Partnership a landmark 21st-century agreement, setting a new standard for global trade while taking up next-generation issues.  These features include:

Comprehensive market access:  The TPP eliminates or reduces tariff and non-tariff barriers (include quotas, levies, embargoes, sanctions and

other restrictions) across substantially all trade in goods and services and covers the full spectrum of trade, including goods and services trade and investment, so as to create new opportunities and benefits for our businesses, workers, and consumers.  Regional approach to commitments:

   The TPP facilitates the development of production and supply chains, and seamless trade, enhancing efficiency and supporting our goal of creating and supporting jobs, raising living standards, enhancing conservation efforts, and facilitating cross-border integration, as well as opening domestic markets.   Addressing new trade challenges:

  The TPP promotes innovation, productivity, and competitiveness by addressing new issues, including the development of the digital economy, and the role of state-owned enterprises in the global economy. 

KEY FEATURES: continue…

Inclusive trade:  The TPP includes new elements that seek to ensure that economies at all levels of development and businesses of all sizes can benefit from trade.  It includes commitments to help small- and medium-sized businesses understand the Agreement, take advantage of its opportunities, and bring their unique challenges to the attention of the TPP governments.  It also includes specific commitments on development and trade capacity building, to ensure that all Parties are able to meet the commitments in the Agreement and take full advantage of its benefits.   Platform for regional integration: 

The TPP is intended as a platform for regional economic integration and designed to include additional economies across the Asia-Pacific region. 

The Objectives of TPP: High-standard, ambitious, comprehensive, and balanced agreement that will promote

economic growth

Support the creation and retention of jobs

Enhance innovation

Productivity and competitiveness

Raise living standards

Reduce poverty in member countries; and promote transparency, good governance, and enhanced labor and environmental protections. 

Potential Negative impacts of TPP:Intellectual property rights:

Adopt criminal sanctions for copyright violation that is done without a commercial motivation (ex. file sharing of copyrighted digital media).

Cost of medicine Healthcare in developed and less developed countries including potentially

increased prices of medical drugs due to patent extensions , which could threaten millions of lives.

Environment: TPP will further threaten environment in least developed countries like Vietnam and

Singapore.

Impacts on global trade: The European Centre for International Political Economy : predicted in 2012 that the

TPP would be a ‘deadly threat to European exporters of agricultural products in TPP countries.

The deal could reshape industries and influence everything from the price of cheese to the cost of cancer treatments in the region.

The deal is seen as a challenge to China’s growing dominance in the Pacific region.

The TPP would expand tariff-free access to a variety of countries where Canadian exporters currently face high tariffs, in particular Malaysia and Vietnam.

Impact on emerging markets The Trans-Pacific Partnership (TPP) are likely to divert trade away

from non-participating countries, especially those which qualify as emerging market economies. E.G china and India.

According to one estimate trade worth $2.7 billion will be diverted away from India with this deal.

TPP may present challenges for the least developed countries. For example, some of the developing countries may get affected by Vietnam’s improved market access in the US. E.G Bangladesh.

Potential Partners of the TPP

China India Columbia Costa Rica Philippines

Conclusion: TPP negotiations are not done openly and it’s in process of seeking approval

of U.S Congress, the access to the public is also restricted largely, which is creating chaos, mistrust on this agreement.

Number of protests are done against TPP in some of their participant countries by the local companies with concerns of protecting local manufactures, service providers, food and safety standards, and protection of labor laws.

TPP is designed primarily by developed countries with their own concerns in mind. Poorer countries may feel pressured to join, despite not really being ready to adopt many of its provisions and having had no opportunity to help shape it.

References: https://ustr.gov/tpp/overview-of-the-TPP https://www.google.com.pk/?

gws_rd=cr&ei=yoZlVuaBMsWgsgGH6q6oBg#q=phased+liberalization+schedule+meaning

https://ustr.gov/about-us/policy-offices/press-office/press-releases/2015/october/summary-trans-pacific-partnership

https://en.wikipedia.org/wiki/Information_Age https://

www.google.com.pk/search?q=tpp&biw=1366&bih=623&source=lnms&tbm=isch&sa=X&ved=0ahUKEwiorOS168nJAhXDng4KHXMqARIQ_AUICCgD#imgrc=kP-YwchQ1z8WUM%3A

https://ustr.gov/tpp/ https://medium.com/the-trans-pacific-partnership/small-and-medium-

sized-businesses-8de15a02d843#.tbhp4ajy6