Controversial TPP pact signed after 7 years of negotiations
One of the biggest and most controversial trade deals in history, Trans-Pacific Partnership (TPP) agreement has been signed among 12 Pacific rim countries on 4 February 2016, in Auckland, New Zealand after 7 years of negotiations. It will come in to force one it get approved at home.
The 12 countries which have signed the pact are : Singapore, Malaysia, Vietnam, Brunei Darussalam, Japan, Canada, United States, Mexico, Peru, Chile, Australia and New Zealand. These member countries across the Pacific Rim are home to 800 million people and account for 40% of global trade.
What is Trans-Pacific Partnership (TPP) Agreement ?
The Trans-Pacific Partnership (TPP) is a free trade agreement promising to liberalise trade and investment between the 12 nations, which make up about 36 percent of the world's GDP and 40% of the global trade.The agreement will create a unified market similar to European Union by liberalizing the trade factors in nearly all goods and services by eliminating tariff and non-tariff barriers. Historically, the TPP is an expansion of the Trans-Pacific Strategic Economic Partnership Agreement (TPSEP or P4), which was signed by Brunei, Chile, New Zealand, and Singapore in 2005.
Objective : (a) Lower trade barriers such as tariffs (b) Establish an investor-state dispute settlement mechanism (c) Establish a common framework for intellectual property (d) Enforce standards for labour law and environmental law.
Motto of the Agreement : "promote economic growth; support the creation and retention of jobs; enhance innovation, productivity and competitiveness; raise living standards; reduce poverty in our countries; and promote transparency, good governance, and enhanced labor and environmental protections".
Features of Trans-Pacific Partnership (TPP) Agreement
⇒ The agreement will serve as a common platform for regional economic integration of Pacific Rim countries.
⇒ It will create co-operative trade environment that will boost the economic growth of every member nations.
⇒ It will propmote innovation, competitiveness and productivity of the member nations by addressing crucial trade issues such as labour laws, intellectual property rights etc.
⇒ It aims at reduction or complete elimination of tariff and non-tariff barriers in a list of goods, services and investments which will be leading factor in growth of trade among the member nations.
⇒ It Facilities seamless integration of economies of members facilitating; opening markets, cross border trade and development of production and supply chains.
A pact to curb the growing might of China :
Critics of the pact says that the deal could be used by the US to counter China's influence in the region and is part of its so-called “Asia Pivot” or Rebalance doctrine and seeks to counter the rising power of China. US President Barack Obama said that "TPP allows America -- and not countries like China -- to write the rules of the road in the 21st century,"