12 OCTOBER 2010: Both the Wall Street Journal and Bloomberg have reported on Malaysia's inclusion in the third round of talks, bringing the ranks of partners to nine.
The WSJ notes both the likely long duration of talks, as well as the uncertainty as to whether a final agreement would even be assured passage in congress without any form of fast-track authority for members. On the other commentators note the strategic value of the US's increasing engagement in the area (particularly as against China), and that Malaysia's inclusion as the US's 16th-largest trading partner gives the TPP some much needed momentum.
Speaking to Bloomberg, Australian trade academic John Ravenhill was more pessimistic about the relative insignificance of many of the partners so far, but noted that the inclusion of Japan and South Korea could make it the broadest-ranging US FTA since NAFTA. For Malaysia's part, it notes that the announcement and deal may attract foreign investment to the South-East Asian nation again, after it had been flagging in recent years.
Both articles follow below.
11 OCTOBER 2010: The third round of TPP agreement negotiations have ended in Brunei Darrulsalam. The talks ran from the 4th until the 9th, with parties giving a particular focus to the preparation of a consolidated text, as well as proposals for co-operation. Over 300 negotiators from TPP member countries participated, with 24 separate negotiating groups splitting aside across the week to discuss industrial goods, agriculture, textiles, standards, services, investment protections, IP, government procurement, competition, labour, and environmental standards.
During the talks Malaysia was made a member of the negotiations by the consensus of the eight existing members. Chief negotiators issued a joint statement to the press, saying they were 'pleased with the progress this week'. US Trade Representative Ron Kirk has notified Speaker of the US House of Representatives Nancy Pelosi, as well as Senate President Daniel K. Inouye, of Malaysia's inclusion. He hailed the state's plans for extensive economic reform, following issues which stymied the original plans for a US-Malaysia FTA a few years ago.
8 OCTOBER 2010: Democratic Congressman David Wu has written an open letter to Barack Obama, calling for all US trade agreements under negotiations, particularly the TPP, to promote and uphold human rights.
Wu's letter observes that talks such as the TPP should be used as an opportunity to advance democracy and the rule of law in other member countries, and points to the so-called 'democracy clauses' in other trade agreements around the world (including the integration agreements for the EU and MERCOSUR), that the US could follow as an example.
In the TPP context, he points in particular to the presence of Brunei, Singapore and Vietnam in talks - all three of whom have been cited in the past for arbitrary limits on freedom of speech, the press, religious freedom, and assembly.
The full text of Congressman Wu's letter can be read here.
OCTOBER 4 2010: Inside US Trade reports that a coalition of US business groups supporting the TPP negotiations have urged the USTR to include a separate TPP chapter to deal with regulatory coherence, in light of the reported emphasis negotiators have put on the topic in talks to date.
The coalition, headed by the US Chamber of Commerce, previously submitted a paper on regulatory coherence to negotiators in May. They have now issued another document of general recommendations, including that agreeements be made on a sector-by-sector basis. Sources say this may reflect the fact talks on coherence are at an early stage.
Other recommendations are:
* that negotiators identify in separate chapters a list of both best practices and unacceptable regulatory conditions;
* that the US request that other parties in the talks deliver a list of 'regulatory coherence deliverables and achievements' to set a sense of their initial progress;
* that any regulatory coherence chapter contain provisions on meaningful stakeholder consultation.
The coalition has also released a draft document of 14 'principles' ahead of the third round of TPP talks in Brunei. Its recommendations include:
* the conclusion of talks by late 2011;
* a set date for elimination of all tariffs and non-tariff barriers;
* that the TPP build on existing IP protections in previous US FTAs.
Sources say that as of early October, the US had not yet placed any concrete requests on regulatory coherence at the feet of the other negotiating partners, but may submit a concept paper on regulatory coherence during the third round of talks in Brunei, asking that parties outline what (if any) regulatory bodies and coordinating systems they currently have or use. Another source suggested that the US will aim to base its approach on its current position at the Doha talks.
It is understood that Singapore has already submitted a paper on regulatory coherence, while New Zealand, which is chairing TPP talks on regulatory coherence, plans to submit its own concept paper on the issue when it hosts the next round of talks in December.
OCTOBER 6 2010: In a letter dated October 5, 2010, USTR Ron Kirk has informed the Speaker of the US House of Representatives, Nancy Pelosi, that Malaysia will be included in ongoing negotiations on the TPP agreement.
Speaking ahead of the third round of TPP talks in Brunei, Kirk said that Malaysia's inclusion "will contribute meaningfully to these goals and to the development of the high standard , 21st-century trade agreement (the US) is seeking."
Kirk continues by observing that US goods and services exports to Malaysia totalled $10 billion in 2009, which the TPP will likely enhance. He also says he has Malaysia's assurances that since it embarked on a process of extensive domestic economic reform, it is now prepared to conclude a high-standard agreement, including previous contentious issues from the US and Malaysia's fruitless bilateral negotiations.
The Malaysian Ministry of International Trade and Industry reported that the decision came unanimously among the existing parties, estimating that it would increase the total percentage of Malaysian global trade accorded preferential treatment to 71.2%. Bernama reports that Malaysia will be hoping to benefit from reduced and eliminated export duties on footwear, textile and apparel products, as well as cocoa, petroleum products, and timepieces.
30 AUGUST 2010: Inside US Trade reports that while TPP members discussed complex and concrete proposals on how to structure market access agreements in any final agreement, there were seversal unresolved points at the end of a two day 'intersessional' meeting in Peru.
Sources said negotiators could not agree on how past market access schedules in previous FTA's would relate to any new schedules, or how to structure the market access talks for the TPP itself - and that these are being treated as two interrelated issues.
It is understood that the US presently favours keeping pre-negotiated market access schedules unaltered, while Australia (whose existing market access arrangements with the US exclude key products such as sugar) is arguing in favour of 'opening up' the schedules for future concessions. However the USTR disputes this interpretation, responding that talkd have been more 'nuanced'.
Proposals discussed in terms of structuring market access have included the idea of negotiating a single market access schedule while leaving scope for bilateral outcomes alongside it. Both Malaysia and Canada were present at the intersessional for bilateral talks with TPP members, but did not formally participate in the market access talks. Canada is set to meet US trade representatives on the weekend of September 6 for more expansive talks. Both the US and NZ have expressed misgivings about Canada failing to offer sufficient dairy market access and its agricultural supply management system, should it join the talks.
Meanwhile, members of the TPP business coalition in the US are preparing revised papers for the office of the USTR ahead of the third round of talks in Brunei, with a focus on hotly-debated areas such as regulatory coherence.
5 JULY 2010: Inside US Trade has reported that TPP negotiators will meet in Peru in August to attempt to sort out the architecture of market access schedules. The market access structure will apply to goods, textiles, and agriculture. However, all parties have now agreed to have one set of rules on services, investment, sanitary and phytosanitary rules, technical barriers to trade, government procurement, and IP rules.
Officials have also clarified that previous FTAs within the TPP membership will co-exist alongside any new TPP arrangement. This means that if the TPP were to contain higher standard or more demanding requirements, this would be implemented while existing obligations would be maintained. There will be specific negotiations where an existing FTA and a TPP come into direct conflict.
Ahead of the third round of formal negotiations in October, at which parties are hoping to table draft chapters of the TPP text itself, a source has suggested that some topics, including government procurement and rules of origin, may have specific elements tailored to assist small-to-medium sized enterprises. Making the agreement of more value to these enterprises was one of the main focuses of the San Francisco meeting last month.
22 JUNE 2010: US Representatives Linda Sanchez (California-D) and George Miller (California-D) have written an op-ed in the Huffington Post, framing the TPP talks as an 'excellent opportunity' for Barack Obama to deliver on his trade campaign committments and break away from the NAFTA models of the 1990s onwards. They call for the TPP to build on the initial improvements to the Peru Free Trade Agreement (negotiated for by House Democrats in 2007) by redressing currently 'excessive' foreign investor privileges, more stringent safety and inspection standards for food and manufactured goods, and promote US-based green manufacturing.
It also examines the records of Brunei and Vietnam and calls for the final text to include a democracy clause of some sort, cautioning that their inclusion may otherwise promote sweatshop labour in Asia while damaging industry in the US.
The Office of the United States Trade Representative has just released its annual 'hit list' for 2010 on subsisting trade barriers in its trading partner countries. All seven of its current negotiating partners in the TPP are reviewed, with all having particular areas where the US argues further reform, liberalisation, or transparency is needed. These include pharmecutical goods, audiovisual and media services, tariff barriers, investment rules, e-commerce, and legal services. All 2010 USTR profiles can be found on the respective country page on this site, and below.
USTR report on NZ's Foreign Trade Barriers, 2010
USTR report on Australian Trade Barriers, 2010
USTR report on Chilean Trade Barriers, 2010
USTR report on Brunei's Trade Barriers, 2010
USTR report on Singapore's Trade Barriers, 2010
USTR report on Peru's Trade Barriers, 2010
USTR report on Vietnam's Trade Barriers, 2010