Trade pact faces US opposition

Last updated 11:50 17/11/2013

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There isn't much that would put US tea party leaders such as Representative Michele Bachmann in league with WikiLeaks and the left-leaning crowd at Public Citizen, the activist group founded by Ralph Nader.

But a proposed trade treaty with Pacific countries, including New Zealand, is stoking opposition among an unlikely cohort, drawing fire from a broad group of congressional Democrats and Republicans as well as a high-toned gaggle of PhD economists. It even earned a spot on the WikiLeaks circuit with the disclosure of internal negotiating documents.

The far-flung opponents all want more opportunity to review the 12-nation agreement known as the Trans-Pacific Partnership, and hope to prevent the Obama administration from getting "fast track" approval from Congress.

"Fast track is history," said Lori Wallach, head of Public Citizen's Global Trade Watch, after 151 House Democrats signed a letter to President Barack Obama saying they were "deeply troubled by the continued lack of adequate congressional consultation" on the TPP talks. A similar letter was sent by a group of Republicans that included Bachmann, a Republican from Minnesota, and several other members of the Tea Party Caucus. All said they opposed fast-tracking the deal.

To US Trade Representative Mike Froman, however, the swirl of opposition was to be expected ahead of the latest round of talks next week in Salt Lake City, and in recognition that the negotiations are nearing "the endgame."

Once complete, the treaty would have to be approved by Congress, a process that is much more complex if individual members can offer amendments, senators can filibuster and lobbyists can make their case for last-minute concessions.

Froman said he remained confident any final agreement "will attract the necessary support." Froman has previously said the aim is to finish the talks by the end of this year.

Despite Froman's optimism, the opposition did bring into focus the hurdles the administration will need to clear to enact a treaty that officials argue is not as much about short-term market opening as it is about shaping global rules that countries such as China will eventually be obligated to obey.

China is not part of the treaty now. But Japan and several other Asian nations are at the table, and the administration hopes that South Korea will join in the future - a critical mass that could dictate trading terms for the region and the world.

Currently the TPP consists of Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam.

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But a flurry of opposition last week showed how many issues stand in its way.

WikiLeaks published negotiating documents, dating to August, that showed major divisions among the countries on issues relating to governance of Internet commerce, and patent protection in the pharmaceutical industry - and that was just one chapter of the dozens to be included in the agreement.

Activist groups seized on the disclosure, arguing that the administration was advocating patent and Internet regulations that would give more power to pharmaceutical companies to block the introduction of generic drugs, and put developing countries at a disadvantage in access to information.

At a panel discussion in the Russell Senate Office Building, Senator Lindsey Graham, a Republican, and Representative Sander Levin, a Democrat, gathered a group of economists, manufacturing industry officials and labor leaders who agreed that the TPP should die unless it credibly prohibits countries from manipulating the value of their currency to gain an advantage in trade.

Economists such as C. Fred Bergsten, president emeritus of the Peterson Institute for International Economics, and MIT professor Simon Johnson contended that currency interventions by Korea and others had become pervasive, allowing them to boost their exports at the expense of manufacturing companies in the United States and Europe.

The practice is beyond the capacity of organisations such as the International Monetary Fund or the World Trade Organisation to control, they said, arguing that the United States could use free-trade talks to force an end to such actions.

Graham and Levin said they backed the proposal - and were willing to let the TPP die in Congress if some currency provision is not included.

"This is the place to take a stand," Graham said. "I will be voting no if this is not part of it."

-Washington Post

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