TPP Points the Way for Cheaper Global Roaming

According to the article, (http://www.smh.com.au/business/the-economy/tpp-points-the-way-for-cheaper-global-roaming-20151006-gk2hxp.html), Australians could enjoy much cheaper calls when travelling overseas thanks to global roaming provisions in the TPP agreement. One of the provisions of the TPP could slash the exorbitant fees that many mobile providers charge for Australians when using their phones abroad.

The TPP agreement states that “If a Party chooses to regulate rates for wholesale international mobile roaming services, that Party shall permit operators from the TPP countries that do not regulate such rates the opportunity to also benefit from the lower rates.” This means that, for example, if mobile regulators in Japan sign a deal to slash roaming fees for their citizens, then Australians travelling in Japan will also benefit from the same low prices.

Still, mobile customers may have to wait some time for these provisions to kick in, as a roaming agreement between Australia and New Zealand regulators has already been in negotiations for years.

TPP Trade Deal: Who Stands to Gain, Suffer in Asia-Pacific

According to the article, (http://www.bloomberg.com/news/articles/2015-10-06/tpp-trade-deal-who-stands-to-benefit-suffer-in-asia-pacific), the TPP deal sealed Monday in Atlanta will bring various gains and losses to the countries involved, as follows:

  • Japan: Japanese car and auto-parts makers may be the biggest winners, as they gain cheaper access to the US, the industry’s largest export market. During negotiations, Japan was forced to reduce some of the protections granted to its rice farmers, creating a non-tariff import quota of 1% total consumption, while livestock farmers may be hit harder, as tariffs on beef will be cut from 38.5% to 9%.
  • Australia: The TPP deal will remove approximately $9 billion of import taxes from Australian trade, and they will gain access to the US sugar market. Additionally, the cut in the beef tariff will help Australian ranchers, and seafood and most horticulture products will see tariffs dropped as well. Furthermore, Australia and New Zealand successfully pressured the US to compromise on the amount of time that pharmaceutical companies will get to monopolize new biotech drugs, which could lead to cheaper drug prices and more competition.
  • New Zealand: Tariffs are due to be eliminated on 93% of New Zealand’s trade with its TPP partners, representing annual savings of approximately $259 million New Zealand dollars, with the Dairy industry seeing savings of approximately $102 million New Zealand dollars per year. Additionally, tariffs on beef exports will be completely eliminated, with the exception of Japan, where they will drop from 38.5% to 9%.
  • Vietnam: Vietnam will be among the biggest winners, with GDP being boosted approximately 11% and exports growing 28% in the next ten years. Reduced imports in the US and Japan will benefit the country’s apparel manufacturers and the fishing industry will benefit from elimination of import tax on shrimp, squid, and tuna. Eliminating import taxes on pharmaceutical products, however, will lead to tougher competition between domestic Vietnamese companies and foreign companies. The TPP will also increase patent protection, restricting Vietnamese companies’ access to new products as well as inhibit their ability to produce new drugs.
  • Malaysia: State-owned enterprises in Malaysia may suffer from the TPP deal, which calls for equal access to government procurement, however electronics, chemical products, palm oil, and rubber exporters are among beneficiaries.
  • China: Since China failed to join the TPP, they are likely to be among the biggest losers, and are now indicating some interest in joining the TPP in the future. In the meantime, Chinese exporters may lose some market share in the US, Japan, and Vietnam. To combat these losses, China will try to reach more free-trade deals with other countries, especially in Asia.

Trans-Pacific Partnership Deal is Reached

According to the article, (http://www.nytimes.com/2015/10/06/business/trans-pacific-partnership-trade-deal-is-reached.html?_r=0), the 12 Pacific Rim countries involved in the TPP reached a final agreement on Monday, preparing President Obama for what could be the toughest fight of his final year of presidency: securing approval from Congress.

Now that negotiations of the TPP have come to an end, the deal will face months of scrutiny in Congress, where opposition is imminent. Regardless, for President Obama the deal could be a legacy-making achievement; the TPP draws together countries representing 40% of the global economy, and spins them into a web of common rules governing trans-Pacific commerce. The argument that the TPP will be key in limiting China’s power in the global economy is Key to the President’s hard sell of the act to Congress. Obama stated: “When more than 95 percent of our potential customers live outside our borders, we can’t let countries like China write the rules of the global economy. We should write those rules, opening new markets to American products while setting high standards for protecting workers and preserving our environment.”

TPP: Why it’s too early to pop the champagne

According to the article, (http://www.cnbc.com/2015/10/06/tpp-why-its-too-early-to-pop-the-champagne.html), it will take many years before the economic benefits of the TPP are actually felt. To start, there are several hurdles to overcome before it is implemented.

First, the deal must be ratified by each country’s legislature, which is looking to be very difficult in the US; both Democrats and Republicans are opposed to the deal, meaning it is possible that the TPP will be blocked in Congress.

Second, and finally, tariffs are due to be lowered and market access increased only gradually, meaning the effects of the deal will be insignificant in the near future. However, the long-term significance of the deal still should not be downplayed.

Trans-Pacific Free Trade Deal Agreed Creating Vast Partnership

According to the article, http://www.bbc.com/news/business-34444799, the Trans-Pacific Partnership (TPP), the biggest trade deal in decades, was struck on Monday after five years of bitter and tense negotiations. The TPP cuts trade tariffs and sets common standards in trade for 12 Pacific Rim countries and covers about 40% of the world economy. However, although negotiations have been finalized, the deal is yet to be ratified by law makers in all 12 countries.

For President Obama, the TPP trade deal is a major victory. He stated: “This partnership levels the playing field for our farmers, ranchers, and manufacturers by eliminating more than 18,000 taxes that various countries put on our products.” In opposition, however, US Senator and US Democratic presidential candidate hopeful Bernie Sanders argues that Wall Street and big business have “won again,” stating that the TPP deal will cost US jobs and hurt consumers.

Additionally, China was not involved in the TPP agreement, however the Obama administration is hoping that it will be forced to accept the majority of the standards outlined by the TPP. He was quoted: “When more than 95% of our potential customers live outside our borders, we can’t let countries like China write the rules of the global economy. We should write those rules, opening new markets to American products while setting high standards for protecting workers and preserving our environment.”

Furthermore, the final round of TPP negotiations were delayed over how long pharmaceutical companies should be permitted to maintain a monopoly on their drugs. The US wanted twelve years of protection, while Australia and New Zealand argued for five. A compromise was reached, however the definitive protection period has yet to be confirmed.

Finally, the auto industry as well as the agriculture industry were also areas of intense negotiations. In regards to the auto industry, countries agonized over how much of a vehicle must be manufactured within a TPP country in order to qualify for duty-free status. Agriculture was another sticking point, as countries such as New Zealand wanted more access to markets in Canada, Mexico, Japan, and the US; Canada wanted to keep access to its dairy and poultry markets strictly limited, however.

Pacific Trade Ministers Aim to Seal TPP Trade Pact

According to the article (http://news.yahoo.com/pacific-trade-ministers-aim-seal-tpp-trade-pact-050700679–finance.html), top trade representatives of 12 Pacific Rim countries are hoping to finalize the TPP agreement this week following the failed negotiations that occurred in Hawaii earlier this year.

A handful of issues hindered the talks in Hawaii, including US treatment of Japanese auto-parts, the length of patent protections for biologic drugs, and open markets for dairy products from major producers.

While prospects look good that the deal could be sealed this week, nothing is certain. Vocal public groups are raising objection to several issues under discussion, and there have been multiple demonstrations protesting the TPP in both Canada and New Zealand.

Nonetheless, if a deal is struck, it could become a model for an even larger agreement, the Transatlantic Trade and Investment Partnership (TTIP) that Washington is negotiating with the European Union.

Five Questions about the Big TPP Negotiations

According to the article (http://www.ctvnews.ca/business/five-questions-about-the-big-tpp-negotiations-1.2587022), there are five key questions regarding what is at stake with the TPP agreement, as follows:

  1. Would the TPP agreement eliminate NAFTA? No. NAFTA would continue to exist, but certain parts would be superseded by the new agreement.
  2. What will happen to Canada’s auto sector? It depends on who you ask. Some auto-parts companies are solidly in support of the new deal, while some are adamantly against it.
  3. Will there be more imports of foreign dairy? Almost certainly. According to some sources, the U.S. has requested and opening of the Canadian dairy market greater than the 2% share that they granted to Europe in the Canada-EU deal.
  4. Will drug prices go up? Possibly. The U.S. is demanding greater protection for pharmaceutical companies as well as longer exclusivity for cutting-edge medical treatments, which could increase prices.
  5. Could this affect Canada’s election? Absolutely. The race is a nail-biter, and depending on how successful the industries affected by the TPP are, the election could go either way.