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Trans-Pacific Free Trade Benefits Debated
The goal of APEC has always been to create a free trade zone in the Asia-Pacific region. The Trans-Pacific Partnership is under discussion among nine of the 21 APEC economies, with the goal of joining all under one pact in the future. HPR's Nikki Motson takes a look at what passing the TPP could mean.
Government and business leaders representing some of Hawaii’s closest neighbors, are working on an agreement more substantial than the voluntary discussions taking place during APEC.
“The Trans-Pacific Partnership is an incremental process of building a Asia-Pacific free trade area. The goal of officials is to develop a state of the art, 21st century free trade agreement.”
The goal of APEC has always been to create a region wide free trade zone for all 21 economies. The Trans-Pacific Partnership, or TPP, is a free trade agreement under discussion among 9 Asia-Pacific countries. Original members include Brunei, Chile, Singapore and New Zealand. Newer members include the U.S., Australia, Peru, Vietnam and Malaysia.
U.S. Trade Representative Ron Kirk sums up interest in the deal,
“We want more customers. For what we make, what we grow, what we sell.”
Kirk says the Asia-Pacific region is leading the world in economic growth and the U.S. should act quickly to help U.S. exports become favorites as the region creates more disposable income.
“It is a great way to help secure part of our economic future by giving America’s farmers, ranchers, entrepreneurs, and manufacturers access to all of these new consumers.”
Kirk says the Trans-Pacific trade deal would particularly benefit small and medium sized businesses in the U.S. leading to job growth through expansion of American exports.
But critics of the deal say it’s modeled after the North American Free Trade Agreement, or NAFTA. They say along with new customers come pages and pages of binding rules that impact each country’s ability to set standards for health, safety, conservation and consumer choice.
Lori Wallach is an attorney and director of Global Trade Watch for the consumer group Public Citizen. She says large free trade agreements have the ability to challenge and undermine domestic laws and surrender too much power to the World Trade Organization. She provides some recent examples,
“So in the last three months… That tribunal, unelected by no one, accountable to no one has announced, ‘United States, we don’t care that your Congress and your courts say this is a fine law. You’re going to change it or face trade sanctions. You’re not allowed to allow your consumers to know HOW a product was made. As long as flipper’s not in the can you can’t distinguish according to child labor, dolphin deadly, unsustainable.”
Wallach says several cases against U.S. safety, health and consumer choice standards are in dispute under the WTO. Indonesia is challenging the removal of clove and candy flavored cigarettes. They were made illegal in 2009 to reduce the number of young people who get hooked on smokes. A 2008 law requiring foods be labeled with the name of the country it comes from is being challenged by Mexico and Canada.
So far the WTO sided against the U.S. on both the dolphin issue and the food labeling.
Trade Ambassador Kirk says more trade means more disagreements, but disputes are rare when compared to the volume of trade taking place.
“The amounts that are in dispute generally represent less than 5% of the value… defend labels.”
Kirk says Hawaii in particular could stand to profit from a free trade deal in the Asia-Pacific region because of the relationships its developed with many neighboring countries. He says Hawaii exports nearly $700-million-dollars worth of products overseas.
The Trans-Pacific Partnership is in the 10th round of negotiations in Honolulu this week and White House officials say a firm outline is expected to emerge.