Trans-Pacific Partnership free trade deal reached

The United States and 11 Pacific Rim countries have signed the largest trade-liberalizing agreement in a generation.

The controversial Trans-Pacific Partnership (TPP) will create a new economic bloc with reduced trade barrier between the 12 nations involved – the United States, Australia, Japan, Canada, Chile, Mexico, New Zealand, Singapore, Peru, Vietnam, Malaysia, and Brunei.

The deal – in the works since 2008 – represents a major victory for US president Barack Obama and a challenge to China’s growing dominance in the Pacific region.

In a statement, Obama said that the TPP deal “reflects America’s values and gives our workers the fair shot at success they deserve”. 

“When more than 95% of our potential customers live outside our borders, we can’t let countries like China write the rules of the global economy,” he said. “We should write those rules, opening new markets to American products while setting high standards for protecting workers and preserving our environment.”
Japanese Shinzo Abe told reporters that the deal was a “major outcome not just for Japan but also for the future of the Asia-Pacific”.

Canadian trade minister Ed Fast said that he doesn’t anticipate the deal leading to job losses, but admitted that “some industries will have to adapt”.

“This is a once in a life time opportunity to shape rules in the Asia Pacific region,” he said.

The deal must now be approved by lawmakers in the 12 TPP counties.

The final round of talks in Alabama were delayed by negotiations over how long pharmaceutical companies should be allowed to have a monopoly period over next-genration drugs. The US had sought 12 years of protection to encourage pharmaceutical companies to invest in expensive biological treatment, while Australia and New Zealand had pushed for a period of five years so as to bring down drug costs and the burden on state-subsidized medical programmes.

Eventually, a compromise was reached but the agreed probation period has not yet been confirmed.

The TPP deal has proven controversial because of the secrecy of the negotiations throughout the past five years and its perceived threat to an array of interest groups, from Mexican auto workers to Canadian dairy farmers.

The deal establishes dispute settlement guidelines between governments and foreign investors separate from national courts, and also sets minimum standards on issues ranging from  workers’ right sot environmental protection.