[CTC] Congressional Worries Over TPP

[Arthur Stamoulis]

Washington Trade Daily
Volume 25, Number 119 Wednesday, June 15, 2016
Congressional Worries Over TPP
 
The Administration must resolve Congressional concerns with the TransPacific Partnership
before Congress recesses in mid-July if it wants to see Congress approve the agreement later this year,
House Ways and Means Committee Chairman Kevin Brady told WTD yesterday (WTD, 6/14/16).
So far, the process of resolving outstanding issues is moving too slowly, Mr. Brady said. The
Administration is saying the right things, but it is not translating into solutions.
 
“We need to see solutions before we go out in July” if there is to be any hope of action on TPP in
the post-election “lame duck” session, Mr. Brady said in a brief interview with WTD. In particular,
there must be a resolution on the issue of the data protection period for biologics because that is an
important issue for Senate Finance Committee Chairman Orrin Hatch (R-Utah) and the US
pharmaceutical industry.
 
Even on the one issue on which the Administration has offered a solution relating to TPP’s
exclusion of financial services providers from rules barring forced localization of data more work is
needed, Mr. Brady said. Members of Congress and industry stakeholders are still waiting for details on
how the recent Administration proposal would be put into effect in future trade agreements and how it
would ensure that all TPP members eventually adhere to it.
 
If agreement can be reached on the outstanding issues by the time Congress leaves town in
mid-July, Congress can begin the process of moving TPP when it returns in September, the chairman
suggested. That way, the implementing legislation would be teed up for a vote sometime late in the year.
He said he sees no possibility of a vote before then.
 
The Ways and Means chairman said he worries that if Congress is unable to get TPP passed this
year, it will have to wait for several years. In the meantime “China will eat our lunch economically,” he
warned.
 
Failure Could Mean a Long Wait
 
US Trade Representative Michael Froman expressed similar concerns yesterday that failure to
approve TPP this year could mean a long wait for action as a new President takes office next year. “If
TPP doesn’t get done this year, it’s unclear when it will get done,” he told the National Council of
Farmer Cooperatives.
 
Speaking later in the day at the Wall Street Journal CFO Forum, the USTR said he is confident
that when the time comes for a vote, support will be there to pass the TPP implementation measure. The
Administration can find solutions to the issues flagged by members of Congress, including biologics.
TPP raises intellectual property rights standards, including the data protection period for
biologics, Mr. Froman said. The eight years of protection provided in TPP is far more than most of the
countries currently offer. But what the Administration is hearing from Congress is that lawmakers want
assurances that the eight years “is real” and that there is nothing in TPP that would undermine US law,
which is 12 years.
 
Mr. Froman said he is confident TPP will pass because lawmakers understand the economic and
strategic costs of delay.
 
But one senior Democrat on Ways and Means warned yesterday that the Administration will not
have the votes for TPP unless concerns about trade agreements leading to job loss is dealt with. At a
trade subcommittee hearing on agriculture, subcommittee ranking Democrat Charles Rangel (NY) said
members might be willing to take another look at TPP if it is accompanied by a package of measures that
page 2 Washington Trade Daily
 
would create jobs. Much-needed infrastructure spending would create new jobs as would better
workforce training and education, he suggested.
 
Ending the long-standing embargo on Cuba would open up a new market for US exports,
creating new jobs, Mr. Rangel added.
 
Subcommittee chairman Dave Reichert (R-Wash) said the Administration also will have to
reassure Congress that the other TPP countries will comply with the agreement, including on
agriculture-related measures like sanitary and phytosanitary measures. Canada already appears to be
going back on its commitments in TPP and the North American Free Trade agreement by erecting
barriers to US dairy products.
 
The United States gets “badly gamed” in trade agreements because they are never enforced, Rep.
Mike Kelly (R-Pa) complained. “I wonder if there really is such a thing as a free trade agreement,” he
added.
 
‘Heavily Invested’
 
Rep. Kristi Noem ®-SD) said she is “heavily invested” in getting TPP passed, but she is not so
sure about President Obama. “Supposedly the President is heavily invested too, but I haven’t seen him
working Congress like he should. It has to be all hands on deck.”
 
At another forum Deputy Commerce Secretary Bruce Andrews said yesterday that passage of
TPP remains at the top of President Obama’s trade agenda – and he is working the issue hard. Speaking
at the Center for Strategic and International Studies, Mr. Andrews said there is “an incredible economic
logic” to getting TPP done.
 
On a separate issue, the Commerce official said the Administration does not believe that it is
required by China’s World Trade Organization accession protocol to automatically give Beijing market
economy status this year (WTD, 6/14/16). China already has the ability to seek a review of their market
economy status in the context of any trade remedy investigation, he said at CSIS.
 
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