There has been much scaremongering surrounding the Trans- Pacific Partnership (TPP) negotiations and significantly less publicity around the potential benefits of the agreement – of which there are many.
Liberalisation of trade should preferably advance on a multilateral basis; however, in the absence of any foreseeable completion of the WTO Doha Round of negotiations, advances in the liberalisation of international trade must occur, by default, pursuant to regional, bilateral and other Free Trade Agreements (FTAs) or similar agreements.
TPP is a regional agreement currently being negotiated by Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Japan, Singapore, Peru, the United States and Vietnam. Negotiations commenced in 2010 and some believe the agreement will be concluded as early as mid-2015.
Critics of the TPP have expressed concern regarding the Health and Pharmaceutical Benefits Scheme, IP protection, the inclusion of Investor-State Dispute Settlement (ISDS) provisions, privacy laws and the lack of transparency surrounding the negotiations. However, the Government has provided assurances that:
- The Australian Government is not going to accept any outcome that would adversely affect the integrity of the Pharmaceutical Benefits Scheme or our health system more generally.
- Australia has an effective and balanced intellectual property regime and the current system is not going to be alerted through the TPP.
- Australia will look to seek an outcome on intellectual property in the TPP that is consistent with existing international intellectual property commitments, and that retains the flexibilities Australia currently have.
- The Government would not entertain ISDS provisions that restrict our ability to pursue legitimate public policy objectives. For example, should they negotiate on ISDS, they would seek exceptions and other protections to further safeguard current and future policies on health and the environment.
- The TPP agreement will not alter Australia’s privacy regime.
- It is standard practice in international negotiations that the parties agree that draft negotiating texts should not be made public.
While the proof will be in the pudding, the Australian public must not forget that, in accordance with the treaty making processes, there will be an opportunity for full public and Parliamentary discussion prior to the Government entering into any final agreement.
So that being said, what do we stand to gain from the TPP?
The potential gains for Australia are significant, with Australian exports to partner countries worth nearly $AUD100 billion in 2012. Moreover, given that over 70 per cent of Australia's trade is with Asia Pacific, the TPP is going to support trade liberalisation throughout the Asia-Pacific region, creating a better trade environment for Australian companies and ultimately increase economic integration of Australia into the region.
The TPP will provide preferential access to three new markets that Australia does not have free trade agreements with, namely Canada, Mexico and Peru. It also provides an opportunity to improve current levels of benefits occasioned under our existing FTAs with countries who are also party to the TPP. There has been some criticism that our current FTAs have ‘not gone far enough’ and the TPP agreement provides a welcome opportunity for Australia to negotiate improved outcomes.
Generally, the agreement will result in fewer barriers for Australian exporters of goods and services and Australian investors and improved supply chains. As a result Australian consumers may benefit as a result of reductions in customs duties being passed on as well as, presumably, more ready access to a wider variety of goods in a more efficient manner.
Importantly, the TPP is hoping to address new trade issues not previously addressed in trade agreements of this nature. These issues include a focus on outcomes for SMEs, strengthening regulatory coherence, the promotion of economic development, and the promotion of transparency of new laws and regulations.
Ultimately, the Australian Government is seeking an outcome that reduces or eliminates trade and investment barriers in partner countries, securing new opportunities for Australian businesses to compete and sell their products abroad, facilitating greater trade flows. This is vital to the Australian economy as trade is a key driver of jobs, innovation and long term prosperity. By creating commonly agreed rules to trade in goods and services and promoting transparency, the TPP opens up new trade and investment opportunities for Australian businesses in the region.
- Lisa McAuley, CEO- Export Council of Australia
- Stacey Mills- Smith, Trade Policy & Research Manager- Export Council of Australia