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Trade

Little headway on Trans-Pacific free trade deal

During his trip to Asia, US President Obama proved unable to resolve differences with Japan over the Trans-Pacific Partnership. Now back in Washington, the president faces growing opposition to the ambitious trade deal.

It's one of the most ambitious free trade agreements ever undertaken, according to Peter Petri, an economist with the Peterson Institute for International Economics. The Trans Pacific-Partnership (TPP) would deepen integration among 12 economies in the Americas and Asia, covering 40 percent of the world's economic output and 26 percent of its total trade.

The free trade negotiations currently include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States.

"The TPP is part of a big long-term strategy that Obama has inaugurated and has been a center piece of his trade policy as well as in some ways his geopolitical reorientation of American policies toward Asia," Petri told DW.

"It's partly a rebalancing of the military forces that the United States has around the world, but especially it's an effort to re-orient the American economy to the fastest-growing markets of the 21st century," he added.

Congressional opposition

But Washington's pivot toward Asia has proven difficult to manage. Returning from his Asia tour, President Obama proved unable to resolve differences with Japan over tariff barriers in the agriculture and automotive industries. The disagreement between the TPP's two heavyweights is one of the key factors that have delayed the negotiations. A deal was supposed to have been reached last December.

Japan Shinzo Abe

A TPP deal appears a long way off

As Obama settles back into Washington, he faces stiff domestic opposition to the free trade deal from his own party. In the House of Representatives, 151 Democrats oppose renewing the so-called fast-track authority. Under fast-track rules, Congress can vote up or down on a draft deal submitted by the president, but cannot add amendments to the draft. The idea is to expedite the passage of complex trade agreements.

"Politics in the United States has really slowed down, meaning that the president did not get trade promotion authority which is a kind of negotiating tool that would have made it possible for him to conclude the deal quickly," Petri said. "Because he doesn't have that, the Japanese are reluctant to make the very tough political concessions that they have to make in the end for the deal to happen."

Labor standards

In addition to opposition within the Democratic Party, environmental and labor groups - often viewed as allies of President Obama - have alleged that the TTP benefits corporations over the public interest.

So far, the TPP countries have made only a vague commitment to the International Labor Organization's conventions on workers' rights, according to Sharran Burrow, the general secretary of the International Trade Union Confederation (ITUC). Burrow told DW that there has been opposition among some of the TPP countries to binding enforcement of ILO standards.

"We have no confidence that the labor chapter will include core international labor standards or that it will have a compliance function that would give us confidence that workers won't continue to be exploited in supply chains," she said.

Organized labor has also expressed concern about investor-state dispute settlement (ISDS) provisions in the TPP, which allow multinational corporations to sue host governments for violating investment agreements. Barrow said that multinationals could use ISDS provisions to undermine attempts by national governments to improve their labor standards.

Environmental protections

Eight of the world's top 20 fishing countries are TPP parties while 34 percent of global timber and pulp production would be covered by the free trade deal, according to Vanessa Dick, a senior policy analyst with the World Wildlife Fund (WWF). TPP countries are also transit areas for wildlife parts harvested through poaching, she said.

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Critics say the TPP offers little in terms of transparency

In January, WikiLeaks leaked a draft of the TPP's environment chapter. According to the draft, if a TPP member suspects a violation of the trade deal's environmental standards, it can request the creation of a tribunal that would then draft an action plan to address the infraction.

But the World Wildlife Fund (WWF) has criticized the draft for not containing a binding mechanism, which would impose sanctions against a violator for failing to carry out the tribunal's action plan.

"We need an agreement, an environment chapter, that's ambitious enough to recognize the economic and environment issues that are being dealt with among the TPP countries," Dick told DW. "And in order for it to have any teeth, it needs to be binding and enforceable."

Intellectual property

Meanwhile, civil liberties groups have criticized the TPP's intellectual property chapter, which was published by WikiLeaks in November of 2013. The draft chapter would expand and entrench the US notice-and-takedown system in the 11 other TPP countries, according to Maira Sutton with the Electronic Frontier Foundation (EFF).

Under notice-and-takedown, copyright holders can inform intermediary sites such as Facebook, Google and YouTube that their content is being used without their permission. Intermediary sites often respond to these notices in order to avoid legal liability.

This can lead to the termination of subscriber accounts and the blocking of content without a court order, Sutton said. In some cases, political and educational content - which is generally protected by fair-use doctrine - is also removed under the notice and takedown system.

"Copyright law is anti-free trade," Sutton said. "You are creating and bolstering monopolies and trying to limit the passage of knowledge and content and innovation through these very extreme proposals."

Calls for transparency

Given the growing opposition to TPP, President Obama has been largely unwillingly to make a strong case for the free trade agreement in the run-up to the mid-term elections this November, according to Petri with the Peterson Institute for International Economics.

"We've had a debate that's been entirely one sided and entirely mobilized by the opposition," Petri said. "And the net effect has been to turn a lot of people - who don't normally think very hard about these things, they don't study the details - at least superficially against the agreement."

Petri believes that the net effect of the trade deal will actually be to improve the labor and environmental protections in developing nations that are party to the TPP, by requiring them to implement international standards such as the ILO conventions.

But it's difficult to know what will ultimately be in the final deal due to the lack of transparency in the negotiations, according to Brett Gibson, a government affairs officer with the AFL-CIO trade union federation. In the US, only members of Congress and some trade union representatives have access to the texts of Washington's TPP proposals, leaving the broader public largely in the dark. The information that has been made available largely comes from leaks by organizations like Wikileaks.

"The US Trade Representative keeps telling everyone they're negotiating in the best interests of the American worker and the American people," Gibson told DW. "If what they're doing is good for American workers then they should have no problem making public what they're putting on the table."

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