What is the Trans-Pacific Partnership?

• 5 October 2015
• From the section Business

The Trans-Pacific Partnership (TPP) is one of the most ambitious free trade agreements ever signed.

Those in favour say this trade deal will unleash new economic growth among countries involved.

Those against – particularly some Americans – fear it could mean jobs will move from the US to those developing countries involved.

They also do not like the fact the five-year long talks have been largely secret.

TPP in a nutshell

There are 12 countries involved: the US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.

The pact is aimed at deepening economic ties between these nations, slashing tariffs and fostering trade to boost growth.

Member countries are also hoping to foster a closer relationship on economic policies and regulation.

The agreement could create a new single market like that in Europe.

When did it start?

It began with a trade agreement between just four nations – Brunei, Chile, New Zealand and Singapore – that came into effect some 10 years ago.

That deal removed tariffs on most goods traded between the countries, promised to cut more and co-operate on wider issues such as employment practices, intellectual property and competition policies.

How big a deal is the TPP?

Pretty big indeed. The 12 countries have a collective population of about 800 million – almost double that of the European Union’s single market. The 12-nation would-be bloc is already responsible for 40% of world trade.

The deal is a remarkable achievement given the very different approaches and standards within the member countries, including environmental protection, workers’ rights, and regulatory coherence – not to mention the special protections some countries have for certain industries.

What do critics say?

They argue it is a not-so-secret gambit to keep China at bay. China is not involved in negotiations.

Others claim it will pave the way for companies to sue governments that change policy on, say, health and education to favour state-provided services.

The TPP will also intensify competition between countries’ labour forces.

But the biggest criticism has been of what the campaigners allege to be secretive negotiations in which governments are seeking to bring in sweeping changes that voters have no knowledge of.

Defenders say the reason the negotiations were not made public was because there was no formal agreement on them.

What happen next?

Details of how the deal will be implemented will be argued out in individual countries’ legislatures in the coming weeks and months before being ratified.

In the US the pact is likely to come before Congress in the midst of the presidential primaries, turning it into a major political football within both parties.

However, Congress has granted the President “fast-track” authority over the deal, which allows lawmakers to review the agreement, but not to amend it.