The fate of the Pacific Rim trade deal was looking shaky even six weeks ago as most the remaining 11 countries questioned whether it was worthwhile bringing it into force next year as scheduled without the US.
But the pendulum appeared to have swung back again after a meeting last week in Vietnam of TPP trade ministers where it was agreed officials should work on a revised deal to be ready for their leaders to sign in November.
Trade Minister Todd McClay told Farmers Weekly countries had quickly rallied around after Japan recommitted to the deal.
Countries like Vietnam had been counting on significant gains for textiles and footwear industries from increased access to the US market and President Donald Trump’s withdrawal had caused them to waver in their support.
That was offset to a degree by the decision of Japan – still the world’s third largest economy – to stay inside the deal and to actively champion its continuation.
“We are in a much better space than we were a couple of months ago.”
Under the TPP’s original terms failure by its two largest members – the US and Japan – to ratify the agreement would have seen it lapse.
McClay said ministers in Hanoi had committed to making minimal changes to the agreement and it was NZ’s view that officials should confine themselves to technical changes to allow the TPP to come into force without the US.
“Nobody said a renegotiation because if you do a renegotiation it is unpicked and it could well fall to bits and it will take a very long time.”
Asked if that meant cuts in tariffs on beef and kiwifruit exports to Japan were safe McClay said it was NZ’s belief that they should remain part of the agreement.
“It is our position that it is a well-balanced agreement and the market access provisions remain in place.”
Sources spoken to by Farmers Weekly said extensive leg-work by McClay in recent weeks in getting around TPP members thought to be wavering in their commitment had also helped to shore up support.
One dairy industry source speculated that could have included reassuring Vietnam it would not be pushed as hard on improving rights for its workers as it would have been had the US remained part of the TPP.
Similar reassurances could have been sought and given to Malaysia, which had swallowed with difficulty US demands during the negotiation to instil greater commercial disciplines among its state-owned enterprises.
The source said so-called side letters could be used without changing the actual text of the agreement.
McClay said TPP members were open to finding solutions for countries with remaining concerns about the agreement.
