The United States is continually expanding their goal of free trade into foreign markets with new agreements of various kinds. One of the newer topics for free import export trade is the Trans-Pacific Partnership (TPP) proposed by President Obama in 2009. The main goal of this trade agreement is for the economic integration in the Asia-Pacific.
There first round of negotiations has just recently been held, March 15th-19th, 2010. Since the trade agreement, there is no official text of the trade agreement, although one can visit the Office of the United States Trade Representative and see the general aims and aspirations that US policymakers. Opinions of others can be found a CATO, a non-profit public policy research foundation.
There is much promise to a trade agreement with the Asia-Pacific region of the world. A large appeal to trade agreements with the Asia-Pacific region is that it is a large region which continues to grow. This means it will provide a great market for American goods at competitive prices once a trade agreement is in place, as well as the hopes of increasing trade relations to countries that do not currently have a high level of import/exports from the United States, namely Vietnam, new Zealand and Brunei. These three are the members of the PPT that do not already have Free Trade agreements of some kind with the United States, and “…would be helpful to business by reducing transactions costs….That would be especially beneficial in Asia, an important hub for global supply chains.” It also has the symbolic effect of reaching out to all markets of the world in an attempt to make the world a truly fair and global marketplace for both American businesses and consumers.
There are objections to the worth and the effort of the Obama administration reaching out to these lesser regions, when we already have individual free trade agreements with the larger importer/exporters in the agreement. CATO found that the lesser trade partners, or the “non-FTA partners (Brunei, New Zealand and Vietnam) are not currently big markets for U.S. exporters: Vietnam—the most important of them—ranked 50th.” That the effort of the administration should be spent more on improving and securing the trade relations of the larger exports destination of US goods in Asia is a fair argument. USTR stated that the Asia region overall is a “…key destinations for U.S. manufactured goods, agricultural and services suppliers. U.S. goods exports to the Asia Pacific totaled $747 billion in 2008.”
The TPP is by no means a sure thing at the moment, nor does it hold any truly large market that the US does not already have some FTA with in some form. However, these regions possess room for growth, and that growth could be accelerated rapidly if trade barriers on American goods were to be removed. The far-sightedness of securing a trade agreement could very well end up being a success story for the United States foreign diplomacy, as many other trade agreements for booming markets like Panama, Korea, and Colombia get stalled in Congress and will only cost Americans businesses market shares to other nations who can enact a free trade agreement in a more timely fashion. USTR found that the Asia-Pacific “have negotiated bilateral trade agreements and regional agreements, including ASEAN + 3 (Singapore, Malaysia, Indonesia, Thailand, Philippines, Vietnam, Brunei, Cambodia, Laos, and Burma plus China, Japan, and Korea) and ASEAN + 6 (ASEAN plus China, Japan, Korea, India, Australia, New Zealand),”and without keeping America on a fair level of competition with other exporting nations, the US could find its economic importance as a world power declining.
By – Domenic Gabriella for Trade.org