Final-stretch talks on huge TPP trade deal open in Atlanta

Paul Handley
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The TPP accord involves significant market openings from Canada, the United States and Japan for farm products from sugar and rice to cheese and beef

The TPP accord involves significant market openings from Canada, the United States and Japan for farm products from sugar and rice to cheese and beef (AFP Photo/Yoshikazu Tsuno)

Trade ministers from the United States, Japan and 10 other Pacific Rim countries opened final-stretch negotiations Wednesday trying to seal a deal on the world's largest free-trade pact, the Trans-Pacific Partnership.

Ministers are under pressure to bridge differences over a handful of key issues which prevented an agreement during top-level talks in Hawaii in July.

The stakes were high for many, with farm and pharmaceutical industry lobbyists from various countries and civil society activists gathered at the same Atlanta hotel to defend their interests.

And as the ministers began meeting Wednesday, a handful of protestors marched through the lobby of the hotel chanting "No TPP! Stop Corporate Greed."

Chief among the politically sensitive final issues under negotiation are US import barriers on some Japanese car parts, market openings to Australia and New Zealand dairy products, and the length of patent protections for life-saving new-generation drugs.

Time is also a source of stress for negotiators. Washington, the main driver behind the pact since discussions began in 2008, wants a deal soon to avoid having to ratify it at the height of the 2016 presidential and congressional election campaigns.

While ratification of the TPP is presumed in many of the 12 countries, in the United States it remains a potential challenge. A senior senator, Orrin Hatch, sent a sharp warning Wednesday that the administration of President Barack Obama should not give away too much.

“No one -- at least no one from our side of the negotiations -- should be in a hurry to close talks if it means getting a less-than-optimal result for our country.... If the agreement falls short, I will not support it."

- Largest free-trade zone -

If completed, the TPP would form the world's largest free trade region, its members comprising about 40 percent of the global economy -- Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.

In driving the talks, the United States is hoping to lock in rules on trade and intellectual property protection that global trade heavyweight China would eventually have to heed.

China, however, has already begun trying to set up its own Asia trade agreement, which analysts worry could take concrete shape if TPP talks fail.

The trade ministers' meeting follows four days of intense detailed discussions between their main negotiators, but it was not clear how much progress they had made on the most difficult issues.

Robert Pettit of the Dairy Australia industry group, said they were worried that refusal of their US rivals to open up the American market to their products was one of the key holdups.

"We are an industry with no subsidies, we are free-traders," he said.

- Cost of life-saving drugs -

According to a study by the Peterson Institute for International Economics in Washington, the stimulus from the TPP pact could add $295 billion in annual global income after the 10-year implementation period.

The negotiations have covered a range of issues, from governments' protection of state-owned enterprises, to setting up extraterritorial tribunals to settle disputes between governments and foreign investors, to the use of capital controls in a country's financial system.

Among key issues still on the table after Hawaii were the opening of US, Japanese and Canadian markets to New Zealand and Australian dairy product exports; US barriers to sugar imports; and US barriers on auto parts imports from outside the US-Canada-Mexico NAFTA free-trade region.

Japanese automakers would benefit if the US part barriers are lowered, but Mexico and Canada have both bristled at the idea, making it one of the most challenging TPP issues.

But the details of the talks are couched in deep secrecy, drawing the ire of civil society groups who, citing some leaked preliminary texts, say they are likely to help businesses while hurting ordinary people.

The Washington group Public Citizen says large pharmaceutical companies are using the agreement to lengthen protections for their products, especially biologic drugs -- drugs that are produced using living organisms and have shown great potential in fighting many diseases, including cancer.

"This would reverse the past US approach, which allowed poorer countries more flexibilities permanently to ensure their populations had access to affordable medicines," the group said.