Trans-Pacific Partnership Agreement

2016-II

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TRANS-PACIFIC PARTNERSHIP AGREEMENT

INDEX

1. Introduction……………………………………………………………….3

2. History…………………………………………………………………….4

3. Country members………………………………………………………….6

4. Objectives…………………………………………………………………9

5. Negotiations……………………………………………………………...10

6. Impact on Peru…………………………………………………………...13

7. Controversy and Public opinion……………………..…………………..17

8. Benefits for Peru…………………………………………………………19

9. Threats for Peru………………...………………………………………..20

10. Case……………………………...………………………………………21

11. Conclusions……………………………………………………………..22

12. Annex……………………………………………………………………23

13. Bibliography…………………………………………………….………24

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1. Introduction

The Trans-Pacific Economic Cooperation Agreement also called Transpacific Agreement is a trade agreement between various countries in the Pacific Rim that addresses a variety of matters of public policy. It involves 12 countries: USA, Malaysia, Singapore, Vietnam, Brunei, Japan, New Zealand, Canada, Australia, Chile, Mexico and Peru. Among other things, the TPP seeks to reduce trade barriers, to establish a common framework for intellectual property, enforce standards of labor law and environmental law, and establish a mechanism for arbitration of investor-state disputes. By the British Broadcasting Corporation (BBC News, 2016) explains that “member countries are also hoping to foster a closer relationship on economic policies and regulation. The agreement could create a new single market something like that of the European Union”.

TPP is a big an important deal, which make positive and negative argues and this is because the 12 countries that are on the agreemente have a collective population of about 800 million - almost double that of the European Union's single market. The 12-nation would-be bloc is already responsible for 40% of world trade according to BBC news.

As we know, the agreement is still being debated for the country members and to take effect, has to be ratified by February 2018 by at least six countries that account for 85% of GDP.

In this research, we will talk about and explain detailed about TPP because as we have mentioned some lines before, Peru is member of this agreement that is close to be ratified. With this commercial agreement, Peru will take greater role in the Asia-Pacific region, associated with major global economies with high economic dynamism and broad market potential. Also, “It is important to note that not participating in the TPP would make Peru lose competitiveness against the countries, Vietnam remains one of our main direct competitors” (Diario Gestión, 2015).

1. History

Transpacific Agreement has been developed to make it a possible deal for several years. According with the Centre for Research on Globalization (CRG, 2013):

When negotiations on the agreement (known originally as the Trans-Pacific Strategic Economic Partnership) were launched on the sidelines of the summit of the Asia-Pacific Economic Cooperation (APEC) forum in 2002, it was a tripartite affair involving New Zealand, Chile and Singapore. Dubbed the Pacific Three (P-3), they would soon become the Pacific Four (P-4) when Brunei joined the negotiations in 2005. The negotiations were concluded later that year and the agreement came into force in 2006 even though the negotiations on the financial services and investment chapters of the agreement were deferred for two years. It was only in February 2008, when President Bush announced that the US would join the deferred P-4 negotiations on financial services and investment, that the US came into the picture […] Malaysia, which was invited in 2010 to join the proposed pact, had been involved in negotiations for a bilateral FTA with the US. With Malaysia as its ninth member, a formal announcement of the emergence of this trading bloc (now known as the TPP with the dropping of the words ‘strategic’ and ‘economic’) was made by the parties at the APEC leaders’ meeting in Honolulu in 2011. In the same year, the US’s partners in the North American Free Trade Agreement (NAFTA), Canada and Mexico, indicated their intention to join the grouping and they made their debut at the 15th round of the TPPA negotiations in Auckland in December 2012. South Korea had been invited to join the grouping in 2010 but rather prudently declined. But it is the decision to invite its economic rival Japan and the decision of that country to become the latest, 12th member (it participated in the 18th round of TPPA talks in Kota Kinabalu, Malaysia, in July) that is somewhat perplexing. As Wilson Center Senior Policy Scholar William Krist observed in his 2012 paper on the TPPA prepared for the Center, ‘there is some strong opposition to Japan’s participation within the United States; for example, the US auto industry opposes Japan’s participation in the negotiations at this time, arguing that Japan’s market access barriers cannot be remedied in a free trade agreement’.6 There was equally strong opposition within Japan from the country’s small but influential agricultural lobby to joining the TPP.

Japan joined as an observer of the TPP discussions that took place on 13 and 14 November 2010, as an adjunct to the APEC summit in Yokohama. (Japan PM Kan Attended TPP Talks as Observer, 12 de Noviembre de 2010) Japan declared its intention to join the negotiations on March 13, 2013 and its Prime Minister Shinzo Abe made the announcement on 15 March