Ambassador Darci Vetter, chief agriculture negotiator at the Office of the U.S. Trade Representative, said in remarks recently at the World Pork Expo in Des Moines, Iowa, that the passage of the Trans-Pacific Partnership (TPP) could be worth $4.4 billion annually to U.S. farmers. The trade deal would give farmers and ranchers unprecedented access to 40 percent of the world’s gross domestic product and, by 2020, two-thirds of the world’s middle class, Vetter said.
If TPP, which has not been approved by Congress, does not pass, Vetter said the economic consequences could be dire for U.S. farmers and could hand economic leadership of the Pacific region over to China. While the United States already ships 43 percent of all its agricultural exports, worth about $57 billion annually, to the TPP nations, the trade deal includes lower tariffs and less hassle for U.S. imports and greater access to rapidly developing markets in need of high-quality animal protein and cereal crops, Vetter pointed out.
If TPP is passed, Vetter said countries without an existing trade agreement with the United States, which includes Brunei, Japan, Malaysia, New Zealand, and Vietnam, will eventually eliminate 93 percent of their agricultural duties with the United States.
If TPP is not passed and enacted, U.S. agriculture would stand to loose out on billions, according to estimates shared by Vetter. The U.S. International Trade Commission said U.S. exports would be $7.2 billion lower if TPP is not passed.
Meanwhile, Vetter pointed out that China is currently leading a preferential trade deal in Southeast Asia called the Regional Comprehensive Economic Partnership, which includes many TPP nations as well as India, Cambodia, Myanmar, South Korea, Laos, Thailand, and The Philippines. This deal gives China preferential access to 35 percent of the global economy and removes its tariffs while putting high tariffs on the United States.
“If we don’t pass TPP, globalization will not stop. Countries will not stop seeking these international supply chains looking for ways to expand their operations,” Vetter said in making the case for passage of TPP. “We are not going to put the globalization genie back in the bottle, but we can draft it in a way that can better meet both our economic interest and our values.”
Meanwhile, the Vietnamese government has now officially announced it will formally ratify the Trans-Pacific Partnership (TPP) trade deal during the National Assembly’s next sitting session beginning on July 20. At least half of the 12 countries who are involved in the pact need to formally approve the deal for it to come into effect.
