Negotiations wrap up in Atlanta with Trade Ministers of the 12 member countries signing the Trans-Pacific Partnership.
The Trans-Pacific Partnership (TPP) has officially been signed after negotiators from the 12 countries reached agreement in Atlanta.
In a telephone call to local media, Deputy Minister of Industry and Trade Tran Quoc Khanh said the outstanding issues from previous talks have been resolved, such as the automobile market, the US and Canada opening up their markets to New Zealand dairy products, and the time for exclusive protection over new pharmaceutical products.
Deputy Minister Khanh also said that the countries in the TPP will conduct a review of the specific content to announce to the people and to businesses.
Ministerial-level negotiations got underway on September 30 in Atlanta in an effort to reach agreement over the world’s largest free trade agreement.
Negotiations first began in 2005 and 12 countries are signatories: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US, and Vietnam.
Once in place the TPP will be a free trade area with 800 million people, accounting for 30 per cent of global trade and nearly 40 per cent of global economic output.
Deputy Minister of Industry and Trade Tran Quoc Khanh
The result of the negotiation is a high quality agreement with comprehensive and balanced economic growth that supports the creation and maintenance of employment, promotes innovation, productivity and competitiveness, raises living standards, reduces poverty, and improves transparency, good governance, labor protection, and environmental protection. We see the end of negotiations as an important step towards the highest goals of free trade and integration across the region.
Ms. Sherry Boger, Chairwoman of the American Chamber of Commerce (AmCham).
After many years of work the TPP is closer to conclusion and ratification. With work and reform, Vietnam could be the largest beneficiary in relative terms.
The TPP is important for all member countries and especially Vietnam, first of all because of the specific, positive impact on the export of goods and services, GDP growth, and the creation of more jobs. Some experts predict that Vietnam’s exports will increase by 28.4 per cent.
The expected export “baseline” in 2025 without the TPP of $239 billion could grow to $307 billion. In addition, the expected GDP growth benefits are substantial.
Dr. Nguyen Duc Thanh, Head of the Vietnam Institute for Economic and Policy Research
Without full preparations the pros and cons of the TPP may lead to uncontrollable consequences. It will make industries with low competitiveness, such as the livestock industry, forestry, and mining, etc., likely suffer losses. Moreover, with tariffs decreasing gradually to zero, State budget revenue from taxes will fall and the government will have to find other ways to offset the loss to stabilize the State budget. Some policies may prevent the economy from recovering, however, while increasing the likelihood of macro-economic instability.
Investment into Vietnam will be the most impressive, roughly matching the growth rate seen in Japan, which is nearly twice the rate of Australia, Malaysia, or the US in value terms. Meanwhile, investment into countries outside of the AEC and the TPP should decrease significantly, especially to China and Europe. Simulations have shown that trade activities between Vietnam and other TPP members will increase as trade activities with members outside of the TPP see substantial increases in import turnover and slight decreases in export turnover.
Five main characteristics make the TPP a landmark agreement of the 21st Century, creating a new standard for global trade while referring to the issues of new generation. Its features include:
■ Comprehensive market access. The TPP reduces tariff and non-tariff barriers to all trade in goods and services and adjusts all aspects of trade, including trade in goods, services, and investment, in order to create new opportunities and benefits for businesses, employees, and consumers of member countries.
■ Regional approach in making commitments. The TPP facilitates the development of production, supply chains, and uninterrupted trade, promotes efficiency, supports the implementation of the goal of creating jobs and raising living standards, promotes conservation efforts, and facilitates cross-border integration as well as the opening up of the domestic market.
■ Solves new challenges to trade. The TPP promotes innovation, productivity, and competitiveness through solving new problems, including the development of the digital economy and the increasing role of State enterprises in the background global economy.
■ Covers all elements related to trade. The TPP includes new elements to ensure that the economy at all levels of development and businesses of all sizes can benefit from trade. The agreement includes the commitment to help small and medium-sized enterprises understand the agreement, to take advantage of the opportunities that the agreement provides, and raises significant challenges to governments of member countries.
■ Foundation for regional integration. The TPP was launched to create a platform for regional economic integration and built to include other economies across Asia-Pacific.