U.S. Trade Representative Michael Froman said that progress was being made in the ongoing multi-lateral Trans-Pacific Partnership (TPP) trade deal but that it would not “happen overnight.” Froman was in Iowa this week discussing the role of exports in President Obama’s trade agenda.
Negotiations with Japan continue to be difficult, but “we are engaged in negotiations, the President visited there the end of April and that led to the beginning of real negotiations over agriculture. We’ve reached agreement that all product areas will be covered. There’ll be no exclusions. And that’s an important step. And now we’re going literally product by product, line by line to figure out how we can achieve meaningful market access for all of our products,” Froman said.
American agriculture stands to gain significantly from the ongoing TPP trade deal. Twelve Pacific Rim nations, which together represent a third of global trade, are attempting to eliminate tariffs between their countries. Just last year, 41 percent of a record $141 billion in American ag exports were bound for the Asia-Pacific region.
Japan believes some of its ag products, like beef and pork, are “sensitive” to competition with foreign exports and should be exempt from the talks. In Japan, the average ag tariff is about 40 percent while U.S. ag tariffs average around 12 percent.
The final hurdle for the deal will be whether or not Congress grants the President Trade Promotion Authority (TPA) that allows the Executive Branch to broker trade deals, which Congress can pass or reject, but not amend. TPA gives trading partners confidence that an agreed-upon deal will not be changed. Many believe the mid-term elections will postpone any TPA decisions until after the mid-term elections.
