[CTC] U.S. Business Rep Sees USTR Willing To Move On Sensitive Issues In TPP

[Arthur Stamoulis]

Inside U.S. Trade - 07/24/2015
U.S. Business Rep Sees USTR Willing To Move On Sensitive Issues In TPP
Posted: July 23, 2015
A senior official with the U.S. Chamber of Commerce said Wednesday (July 22) that the Office of the U.S. Trade Representative is indicating for the first time in the Trans-Pacific Partnership (TPP) talks that it is willing to show flexibility on its key sensitive areas like sugar, apparel and footwear in order to get a deal across the finish line.

At a press briefing, Tami Overby, the Chamber's senior vice president for Asia said USTR has signaled it is willing to make difficult political decisions on these issues if other countries reciprocate, and that this message is qualitatively different than before. She said she had met several times with senior USTR officials over the last several weeks.

Overby said that she was "hopeful" TPP negotiators can reach a deal at the July 28-31 ministerial in Maui, but that she was not sure it would happen and that it would likely be a "roller coaster" like previous trade negotiations.

She hinted that the Chamber prefers the U.S. hold out for a better deal than to take a bad one in Maui. "Hopefully our negotiators can accomplish this [deal] in Maui, but I want to emphasize the main objective is a strong comprehensive deal as soon as we can," she said.

Overby identified intellectual property (IP) as the most difficult area of the talks, and listed market access, state-owned enterprises, labor, environment and investment as among the other tough issues.

She said USTR has expressed an intent to keep business representatives attending the round in Maui informed of developments on the ground, and has collected their contact information to facilitate that. But another Chamber source said this is not first time USTR has done so. This source said roughly two dozen U.S. business supporters of the TPP are slated to attend the Maui meeting, with most planning to arrive on July 24.

Despite the suggestion by Japanese TPP Minister Akira Amari that some TPP countries could be left out a deal, Overby said she thinks that will not be the case, though she acknowledged that reaching an agreement will be especially difficult for Canada and Malaysia (Inside U.S. Trade, July 17).

In particular, she argued that completing a TPP deal without Canada would be problematic since it would split up the North American Free Trade Agreement (NAFTA) region, leaving the U.S. and Mexico in TPP but Canada on the outside looking in.

That assessment was shared by Cal Cohen, president of the Emergency Committee for American Trade. "A TPP without Canada would create problems for the operation of NAFTA given that our markets are now very integrated," he said in an interview.

Still, Overby held open the possibility that the Obama administration and the Chamber would support leaving some TPP countries out of a deal if it were necessary to close a deal in time for it to be considered by Congress prior to the 2016 U.S. presidential election campaign heating up. She also said the U.S. is not the only TPP country that wants to get a TPP deal done sooner rather than later, noting that Japan has upper house elections in the summer of 2016.

"But if we get to whatever that drop dead date is and whatever country is not there, I think the Chamber would be saying let's close with whoever's ready and let's let the others join later," she said.

She said it was helpful that Amari mentioned the possibility that some countries could be left behind, and speculated that TPP negotiators are likely having discussions about that prospect. "It would be irresponsible not to," she said.

USTR Michael Froman has discussed the possibility of leaving Canada out of a final deal in some of the bilateral meetings he has had with his ministerial counterparts from TPP countries over the last few weeks. Similarly, he made clear to Malaysian lawmakers last week during a visit to the country that the U.S. intends to close the deal in some fashion in Hawaii, and Malaysia can either join or be left behind (Inside U.S. Trade, July 17).

Froman during these meetings has also been pressuring TPP countries to make the concessions needed to close the deal in Hawaii, sources said. But some of these meetings have not resulted in real progress on outstanding bilateral issues and instead consisted of the two sides reiterating their negotiating positions, according to informed sources.


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