New Partners at the TPP Table
Today, the United States made trade news for the second day in a row when it announced that Canada would be invited to join the Trans-Pacific Partnership (TPP) Agreement negotiations. The announcement comes on the heels of yesterday’s invitation for Mexico to enter the discussions. Already, nine nations are engaged in the talks -- the United States, Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam.
The Mexican and Canadian announcements, on their own, are great news. Together, they mark fantastic progress toward the development of a 21st century trade agreement that would provide a major economic boom not only to the U.S. but also to the world.
For the United States, the Asia-Pacific markets are key destinations for our technology products, as well as other manufactured goods, agricultural products, and services. According to the U.S. Trade Representative, American goods exports to the Asia-Pacific region totaled $618 billion in 2009 -- 58 percent of total U.S. goods exports to the world. Indeed, the region already accounts for 50 percent of international trade, with Asian-Pacific growth expected to be around eight percent this year. Successful TPP negotiations would only serve to enhance the ability of U.S. companies to build on this record of success, expanding exports and creating new jobs at home.
Equally, if not more, importantly, a successful negotiation of the TPP among these key trading partners would serve as a model for other trade talks. Given the momentum behind it, the TPP carries a hope that modern trade talks do not have to get bogged down by delay and side issues. The pattern would be set for the rest of the world to follow.
If the invitations to Mexico and Canada signify a united North American presence in the TPP, adding Japan to the discussions would carry a similar boost from the Asian-Pacific perspective. Plainly, if Japan were to join TPP negotiations, it would be a global economic game-changer. From the U.S. perspective, the eight current countries negotiating the TPP would combine to form our fourth-largest trading partner. Add Japan to the group, and the TPP would jump to our second-largest trading partner and represent 36 percent of global GDP. And then add the power of Mexico and Canada… well, the opportunities to strengthen the worldwide economy are multiplied several times over.
Last November, Prime Minister Noda signaled an openness to enter into consultations on the TPP talks, but there has been little progress since. We urge the TPP nations and the Japanese leadership to come together. It is no understatement to say that Japan’s participation in the TPP would be of immense significance.
ITI urges all of these countries to accelerate the discussions and reach a final agreement as quickly as possible. The world’s economy stands to gain substantially from a comprehensive free trade agreement that is economically significant, cross-cutting, and forward looking.
-- Maria Medrano is director of global policy at ITI.