The US-VN Plan for Enhancement of trade and labor relations

There has been some time since the TPP full text has been in the public view. If we look closely, there is a separate section for labor relations with Vietnam (https://ustr.gov/sites/default/files/TPP-Final-Text-Labour-US-VN-Plan-for-Enhancement-of-Trade-and-Labor-Relations.pdf), Malaysia and Brunei. Of all three, Vietnam is the most expansive plan clearly signaling how important Vietnam is to US for trade deals. In many blogs, there has been criticism of current Labor practices in Vietnam and also the supposed US soft stand on those issues(Article credit: “After Trans-Pacific Partnership Text Released, Labor Advocates Say Human Rights Protections ‘Not Enforceable’”, by Abigail Abrams, 11/05/15 http://www.ibtimes.com/after-trans-pacific-partnership-text-released-labor-advocates-say-human-rights-2171278). But if we see from a normal standpoint (I am not commenting on the legality of the agreement or enforceability), TPP can usher in a bevy of reforms in Vietnam. The agreement calls out for a variety of reforms, especially for formation of labor unions, their autonomy and effectiveness, formation of ministry and department of labor, abolishment of forced or debt labor, provide capacity for labor department, child labor and the implementation of the same. Also, Vietnam will have to be transparent on its budget, inspection and status of unions. Most of these articles need to be implemented by the time TPP is in force. Only one article regarding enactment of laws for formation of labor unions across enterprises and verticals has to be implemented in five years, which is currently being contested by International Labor Organizations. However, is getting in 90% of reforms better than having nothing at all? Can the pressure of having these reforms be considered a violation of Viet Nam’s sovereignty? And which courts will the violations be addressed in?

 

TPP to get resolved by this month’s end

The article by Nikkei (http://asia.nikkei.com/Politics-Economy/International-Relations/TPP-nations-to-tackle-sticking-points-at-month-s-end) on 18th September talks about the meeting between the ministers regarding the TPP and how they will resolve all the disagreements before this month’s end which will resolve issues in the areas of dairy products, automobiles, intellectual property for pharmaceuticals, and other areas where national interests are at stake.

Dairy rules are not clear yet since July’s meeting in Hawaii. New Zealand wants to expand its dairy products, but Japan and Canada don’t have the ability to accept imported dairy products.

Japan disagrees with Mexico and Canada over auto parts despite their talks with the United States. Japan wants tariffs removed on autos, but Mexico and others seek to restrict duty-free imports to vehicles and parts made over 50% from components originating in TPP nations.

The U.S. is pushing for as lengthy a time frame as possible, giving drug companies the ability to profit longer from proprietary medicines. Australia and others seek a shorter period to enable the rapid development of cheaper generics.

Time is running out for the nations, and they need to come to an agreement as soon as possible for the TPP to get started with. They will need deadlines in order to make progress with their talks.

What the Trans-Pacific Partnership Means for Southeast Asia

An article published on July 27th, 2015 in The Diplomat (http://thediplomat.com/2015/07/what-the-trans-pacific-partnership-means-for-southeast-asia/) describes how the Trans-Pacific Partnership could be a huge step in the right direction for the four Southeast Asian countries of Singapore, Brunei, Vietnam, and Malaysia that are involved in the negotiations. These countries could see significant financial and social reforms stemming from the TPP. For example, Vietnam and Malaysia currently have some of the world’s highest tariffs and non-tariff barriers against foreign businesses, which has reduced foreign competition and caused rapid growth in their economies. Even with their high tariffs, Vietnam still exported almost US$7 billion worth of apparel and US$2.4 billion worth of footwear to the United States in 2012. Upon completion of the TPP, Vietnam will be able to export to the United States at a 0% tariff rate, which will make their exports much more competitive in the American market and could significantly increase their share of the market. The phasing out of these high tariffs will also expose US domestic industries to more strict competition from overseas, but ultimately the new reforms stemming from the TPP will make these Southeast Asian’s economies stronger. Should the United States and other countries involved in the TPP want increased competition from overseas? Why would the Southeast Asian countries want to open the doors to change and reforms? What effect will the TPP have on industries in the United States? Could the TPP cause even more foreign imports into the United States and other similar countries?