The United States made significant headway with the Administration's trade agenda in the summer of 2015. With the passage of Trade Promotion Authority, Congress has agreed to ensure trade agreements negotiated by the Administration receive up-or-down votes in both houses of Congress, without an opportunity for Congressional amendments or filibusters. With this crucial authorization in place, all eyes are now on the long-negotiated Trans-Pacific Partnership (TPP).
The TPP is a free trade agreement that the United States has been negotiating since 2010 with eleven other Asia-Pacific nations (Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam). The Administration has stated that its objective in these negotiations is to "support job creation and wage growth." This comprehensive deal aims to cut tariffs—including those on manufactured products—liberalize foreign service markets, strengthen foreign investment opportunities, and ensure respect for workers' rights, among other goals. If passed, the trade deal "will link 40% of the world's economy."
In July, trade representatives from the twelve negotiating countries met in Hawaii for continued negotiations. In a joint statement, the trade ministers announced that they had "made significant progress and will continue work on resolving a limited number of remaining issues, paving the way for the conclusion of the Trans-Pacific Partnership negotiations," and that they "are more confident than ever that TPP is within reach."
However, several difficult issues remain unresolved. Negotiations over automobiles and trucks reportedlyremain contentious, with Japan hoping to fully integrate its automotive supply networks into the trade agreement and receiving pushback from Mexico, itself a significant exporter of automobiles. Dairy products also remain in contention, with key exporter New Zealand pushing for greater trade liberalization and Canada reportedly hesitant to provide additional access for imports. Several negotiating parties also continue to push for further access to the U.S. sugar market. Finally, intellectual property issues impacting the pharmaceutical industry have posed a challenge to negotiators, as they debate the timeline for allowing generic biopharmaceutical products to enter the markets in TPP countries.
If the remaining obstacles are resolved and a deal is reached, the TPP will still have to obtain congressional approval. With the U.S. election season on the horizon, some have speculated that it will be difficult to secure a vote in 2016.