Background and History

The TPP finds its origins in the Trans Pacific Strategic Economic Partnership Agreement (TPSEP) also known as the Pacific-4 (P4). Agreed to in 2005 and implemented in 2006, the P4 linked Brunei, Chile, New Zealand and Singapore in the first ever Pacific-wide Free Trade Agreement. The P4 was deliberately designed to be a viable model for future multilateral trade cooperation in the region, covering a diverse range of areas including intellectual property, government procurement, rules of origin and sanitary and phytosanitary measures. That being said, the P4 was far from a complete agreement.

Members had decided in 2005 that negotiations for financial services and investment chapters would only commence within two years of the agreement’s implementation. When the time came for these talks to proceed in 2008, the United States had expressed interest in joining the P4 for the purpose of reaching an agreement in these areas, and to canvass the possibility of negotiating a more comprehensive Free Trade Agreement (FTA) with a more diverse array of countries. The United States saw a broadening of the P4 as a way to ensure on-going and competitive access to the burgeoning markets of the Asia Pacific, which were increasingly at risk of becoming closed by virtue of a proliferation of FTAs amongst its trading competitors.

The United States’ involvement had a precipitous effect in attracting other regional players to the table, with Australia, Peru, and Vietnam joining the P4 talks in late 2008, and Malaysia following suit in 2010. After preliminary talks, the nine countries formally announced the formation of the TPP on the side-lines of the 2011 Asia Pacific Economic Cooperation (APEC) forum in Honolulu. In a statement issued by the nine leaders, the newly anointed TPP members set out their “common vision to establish a comprehensive, next generation regional agreement that liberalizes trade and investment and addresses new and traditional trade issues and 21st-century challenges.”1

Of particular note, the leaders affirmed that the TPP “will be a model for ambition for other free trade agreements in the future, forging close linkages among our economies, enhancing our competitiveness, benefitting our consumers and supporting the creation and retention of jobs, higher living standards, and the reduction of poverty in our countries.”2

Negotiations were scheduled to take place immediately and last into 2012. While the member countries expressed their desire to conclude negotiations as rapidly as possible, they conceded that the process could face delays given the ambitious scope and nature of the agreement. Canada and Mexico both announced their ascension to the TPP in 2012, and officially joined the negotiating table in the Auckland round of December 2012. The final member to join negotiations, Japan, did so in 2013.

Despite members’ intentions to conclude negotiations in 2013, a final agreement continues to prove elusive. On-going delays are an indicator of the difficulty of reaching consensus on provisions in a number of sensitive areas including agriculture, the auto industry, and intellectual property. Negotiations have also been challenged by domestic factors, chief among which was the uncertainty of whether President Barack Obama would be able to pass a Trade Promotion Authority (TPA) bill, granting him the ability to pass clean ratification legislation without amendments. Member countries had indicated that this assurance was vital to reaching a conclusion.

More recently, leaders met in Honolulu in July 2015 in a bid to finalize the agreement. While many were optimistic that a deal would emerge from the meeting, negotiators were again unable to resolve a number of outstanding issues. Obstacles include the United States’ unwillingness to offer greater concessions on sugar imports, and Australia’s insistence that a relaxation of import restrictions is a prerequisite for its support. New Zealand is also pushing hard for greater liberalization measures in respect of the dairy industry - something which is being stalwartly resisted by Canada. It also reported that chapters on textiles and autos are facing resistance from Vietnam and Japan.

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