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| In this Nov 10, 2014 file photograph, US President Barack Obama, center, speaks during his meeting with leaders of the Trans-Pacific Partnership countries, in Beijing. Sitting with Obama are, from left, Vietnam Minister of Industry and Trade Vu Hoy Hoang, Vietnam Prime Minister Nguyen Tan Dung, US Trade Representative Ambassador Mike Froman, Singapore Prime Minister Lee Hsien Loong, and Singapore Sec of Ministry of Trade and Industry Ow Foong Pheng. (AP Photo / Pablo Martinez Monsivais, File) |
ATLANTA - Twelve Pacific Rim countries on Monday reached the most ambitious trade pact in a generation, aiming to liberalize commerce in 40 percent of the world's economy in a deal that faces skepticism from US lawmakers.
The Trans-Pacific Partnership (TPP) pact struck in Atlanta after marathon talks could reshape industries, change the cost of products from cheese to cancer treatments and have repercussions for drug companies and automakers.
The TPP is one of the key free trade agreements for the Asia-Pacific region, China's Ministry of Commerce (MOC) said on Tuesday.
China is open to any mechanism that follows rules of the World Trade Organization and can boost the economic integration of the Asia-Pacific, the MOC said in a statement on its website.
Tired negotiators worked round the clock over the weekend to settle tough issues such as monopoly rights for new biotech drugs. New Zealand's demand for greater access for its dairy exports was only settled at 5 am EDT (0900 GMT) on Monday.
If approved, the TPP pact would cut trade barriers and set common standards for a region stretching from Vietnam to Canada. It would also furnish a legacy-shaping victory for US President Barack Obama, who will further promote the agreement on Tuesday in remarks to business leaders in Washington.
The Obama administration hopes the pact will help the United States increase its influence in East Asia.
Lawmakers in the United States and other TPP countries must approve the deal. Five years in the making, it would reduce or eliminate tariffs on almost 18,000 categories of goods.
CURRENCY, DRUGS, DAIRY, AUTO POLICIES
Ministers said the agreement will include a forum for finance ministers from participating countries to discuss currency policy principles. This takes into account, in part, concerns among US manufacturers and critics who suggest Japan has unfairly driven the yen lower to the benefit of its car exporters and other companies.
The United States and Australia negotiated a compromise on the minimum period of protection to the rights for data used to make biologic drugs. Companies such as Pfizer Inc, Roche Group's Genentech and Japan's Takeda Pharmaceutical Co could be affected.
Negotiators agreed on terms that fell short of what the United States had sought. Under the deal, countries would give drugmakers at least five years of exclusive access to the clinical data used to win approval for new drugs. An additional several years of regulatory review would likely mean drug companies would have an effective monopoly for about eight years before facing lower-cost, generic competition.
Politically charged dairy farming issues were addressed in the final hours of talks. New Zealand, home to the world's biggest dairy exporter, Fonterra, wanted increased access to US, Canadian and Japanese markets.
New Zealand Prime Minister John Key said the deal would cut tariffs on 93 percent of New Zealand's exports to the United States, Japan, Canada, Mexico and Peru. "We're disappointed there wasn't agreement to eliminate all dairy tariffs but overall it's a very good deal for New Zealand," Key said.
The United States, Mexico, Canada and Japan agreed to auto trade rules on how much of a vehicle must be made within the TPP region to qualify for duty-free status.
The TPP would give Japan's automakers, led by Toyota Motor Corp, a freer hand to buy parts from Asia for vehicles sold in the United States, but sets 25-30 year phase-out periods for US tariffs on Japanese cars and light trucks.
The deal between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam also sets minimum standards on issues ranging from workers' rights to environmental protection.
Trade ministers said the TPP would be open to other countries in the future, including potentially China.
"There is a real opportunity for China to be a part of this," Malaysian Trade Minister Mustapa Mohamed said.
The Trans-Pacific Partnership (TPP) is set to change the way New Zealand deals not just with the other 11 TPP member nations, but with other major trading partners such as China.
A brief issued by the New Zealand government Tuesday set out some of the claimed benefits and disadvantages of the TPP agreement, comparing many of them to the New Zealand-China Free Trade Agreement (FTA).
Some provisions in the TPP investment chapter would also flow through to New Zealand's bilateral FTAs with China, China's Taiwan and the Republic of Korea, in which there are "most favored nation " provisions.
These included the screening of overseas investment in New Zealand.
