Slow but sure progress in TPP Trade Ministers’ talks in Atlanta, Sep 30 – Oct 1 … or Oct 2 ?

Ministers will meet again on Thu, Oct 1, but no deal is seen likely before Fri, Oct 2, or maybe Sat, Oct 3. Auto sector rules of origin, dairy, IP for biologics remain the key issues. But there are indications of movements toward compromise on all three. Canada has proposed 50% TPP content for autos, lower than the NAFTA rules of 62.5% for autos. Japan has offered to accept higher percentages on auto parts. In addition, former NZ PM Helen Clark said it was “unthinkable” for NZ to be left out of TPP, while NZ Trade Minister Tim Groser said, “Is there a better alternative?” NZ Governments have “tried to negotiate FTAs with the U.S., Japan, Canada, and Mexico for 30 years and have completely failed. With these four giant countries , it’s this or nothing.”

Closer to clearing auto parts rules of origin hurdle

Canada and Mexico are looking for a compromise on auto-sector rules in Pacific Rim trade talks as they try to bridge differences with Japan over a major obstacle to a deal, seeking changes that would boost the proposed pact’s domestic-content requirements for the most sophisticated of car parts.

In Canada’s case, were it to succeed, this would mean under a Trans-Pacific Partnership deal, there would be higher TPP-content requirements for more value-added vehicle parts, such as engines, transmissions and chassis.

The kind of components Canada is championing are made by the biggest players in the Canadian auto-parts sector, such as Linamar Corp. and Magna International Inc., and these are the companies most expected to thrive in the years ahead, particularly if there’s an influx of foreign car parts under a TPP deal.

Japan offered a TPP higher auto rules of origin for vehicles and auto parts, compared with 45% and 30%, respectively, that Japan had requested earlier.

Canadian Trade Minister Ed Fast, in Atlanta for negotiations, said he hasn’t booked a flight home yet and he’s ready to stay as long as necessary to cut a deal.

On the positive side, Canada has secured the removal of tariffs of as high as 5% that other TPP countries currently apply to Canadian aerospace goods, such as engine aircraft parts shipped to Australia or aircraft seats sold to New Zealand. Canada has also obtained a commitment by other TPP countries to eliminate tariffs of as much as 5% on Canadian manufactured goods such as medical, surgical or laboratory machinery.

And Canadian beef, pork and canola producers are expected to be big winners in a TPP deal because the agreement as drafted would significantly lower barriers to selling products in Japan.

NZ: “unthinkable” for NZ to be left out … resigned to “this or nothing” on dairy

Former NZ Labor Party PM Helen Clark said, “It is unthinkable for New Zealand not to be part of TPP, as an export-oriented, small trading nation. So, of course, New Zealand has to be in on the action with the TPP and go for the very best deal it can.”

NZ PM Key said Ms Clark was right. “This isn’t about politics – it’s about enriching New Zealand.” He said economic modeling had shown TPP would be more lucrative for New Zealand than the RCEP , even with a less than satisfactory deal on dairy.

He confirmed Trade Minister Tim Groser had travelled to Atlanta to attend the negotiations – something he previously had said he would not do if the parties were still so far apart a deal did not seem possible.

NZ Trade Minister Tim Groser remains unhappy with the lack of ambition on liberalizing the trade in dairy products, a sign that bigger players in the TPP talks may have relented in their push for Canada to massively open its markets to foreign milk and cheese. He predicted a TPP accord would not be a “gold-plated deal.”

“Basically, the situation is a very good deal for New Zealand in everything except dairy, because it’s not a deal we could accept,” Mr. Groser said.

However, he appeared resigned, saying what is taking shape may be the best that can be achieved. “Is there a better alternative?” Successive governments “have tried to do bilateral with Canada, Japan, Mexico and the U.S. for 30 years and have completely failed,” Mr. Groser said. “With these four giant countries, it’s this or nothing.”

IP for biologics … “I leave it to them to pick the magic number”

Several countries have opposed the U. S. and its pharmaceutical industry for insisting that companies’ drug data be protected for 12 years to create financial incentives to innovate. Critics say this keeps lower-cost generic drugs and “biosimilars” off the market for too long.

While there is talk of an eight-year compromise, a manager of a campaign by Doctors Without Borders to hasten access to lower-priced drugs and vaccines, said she met with American negotiators last week, “and they gave me zero indication that they are going to be more flexible on this issue.”

On the other hand, the executive director of the Global Colon Cancer Association, said drug makers needed the incentives of strong protections for their intellectual property to encourage their research, but did not offer an answer to the question dividing negotiators: how many years the drug makers’ data monopoly should last.

“I leave it to them to pick the magic number,” he said.

Read more …

Canada, Mexico seek concessions on auto rules of origin at TPP talks in Atlanta, Oct 1, 2015

TPP talks closer to clearing auto parts hurdle, Oct 1, 2015

TPP talks nearing “do or die” time, Sep 30, 2015

TPP: “Unthinkable” for New Zealand to be left out, Oct 1, 2015

TPP ministers back at table as Canada preps final offer, Sep 30, 2015

Canada’s trade minister pushing for TPP deal at Atlanta talks, Sep 30, 2015

Final-stretch talks on huge TPP deal open in Atlanta, Oct 1, 2015

Pacific Trade Deal Talks Resume, Sep 30, 2015

TPP chief negotiators see progress in Atlanta talks, Sep 30, 2015

TPP: NZ Trade Minister heads to “wrap-up” meeting, Sep 30, 2015

Hatch: Asia-Pacific Trade Deal Must Meet Requirements of Bipartisan Trade Promotion Authority, Sep 29, 2015

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