Where to now for TPP?

06 Aug, 2015 02:00 AM
Trade Minister Andrew Robb.
The resolve remains to get this done
Trade Minister Andrew Robb.

FEDERAL Trade Minister Andrew Robb remains optimistic the Trans-Pacific Partnership (TPP) can result in positive outcomes for Australian agriculture, despite failing to reach final resolution last week.

Senior ministers and negotiators from the TPP countries including Australia and the US met for high level talks in Hawaii last week, hopeful of finalising an agreement.

In a statement on his return, Mr Robb said significant gains were made during the tense and sensitive negotiations on the world’s biggest regional trade deal “and a conclusion definitely remains within reach”.

“We all went to Hawaii with the aim of concluding and while we didn’t quite get there we are definitely on the cusp,” he said.

“Most importantly the resolve remains to get this done.

“From Australia’s perspective we have made significant gains across every area, including agricultural market access.

“There are a handful of big outstanding issues that directly affect us as well some moving parts involving other countries in areas like automotives, data protection around biologics, dairy and also sugar.

“There has been progress in all of these and from my reading the issues are not intractable and there remains a real determination to conclude the TPP among all parties.”

Sugar a sticking point

One of the sticking points, Mr Robb explained, has been Australia’s demand to increase Australia’s quota on sugar exports into the US market which has a three million tonne annual supply deficit on its 10mt demand.

He said he was looking for multiples of the current offer of 150,000 tonnes from the US for Australian sugar.

It was, he said, a red line issue and was “one of the things that stopped the talks” along with biologics.

He said he was looking for multiples of the current offer of 150,000 tonnes from the US for Australian sugar.

“Often with tariff reductions it doesn’t happen immediately, it happens over three years or five years or whatever; I am looking at those sorts of combinations,” he said.

“What we must have is not just a strong base amount but we must have significant access to growth and a commitment and a guarantee on growth at a very significant level because I think there will be considerable growth in that market in the years ahead.

“So there are many ways to skin a cat but we need certainly over time, multiples of the 150 (thousand tonnes) that is on the table at the moment.”

The Australian Sugar Industry Alliance (ASA) and other farm groups echoed Mr Robb’s optimism.

The ASA said major companies and refiners in the US had backed increased market access by non-subsidised countries like Australia, in the face of their large and increasing sugar deficit.

Alliance spokesman Dominic Nolan said it had been a “marathon effort over the past five years to get negotiations to the point that they are at”.

“The Australian sugar industry says there is now a further opportunity to bring pressure to bear on the US protectionist behaviour which has seen the country unwilling to support increased access for sugar, despite its current three million tonne supply deficit which is growing year by year,” he said.

“It’s hard to see why, apart from politics, access to the US market for Australian sugar is a stumbling block when it is such an obvious step forward in the modernisation of world trade agreements.

“It is imperative the protectionist US sugar industry does not hold up conclusion of the TPP in coming weeks,” Mr Nolan said.

Dairy hopes remain

Of negotiations on dairy, Mr Robb said New Zealand was a “sort of by-product” of a problem that existed between the US, Canada and Mexico - due to the North American Free Trade Agreement - and Japan which plays a big consumer role.

“Those four countries have not got to a solution between themselves and I think the US is best placed to break it, because their dairy industry is now leading the world and they are in a position to create more market access,” he said.

Mr Robb said it also seemed the US “had their hands tied a lot” because of previous commitments given to many congressmen about particular industries, during the recent vote to pass the Trade Promotional Authority which grants executive powers to negotiate trade deals for the US.

“The US has really got a big part to play,” he said.

The Australian Dairy Industry Council also said it was disappointed a meaningful agreement had not been reached but it, too, remained hopeful.

“There is a lot of work to be done and key dairy market access outcomes across the TPP remain unresolved,” a statement said. “Major dairy players must recognise the importance of trade liberalisation and honouring previously agreed positions to advancing negotiations in a positive manner.

“A commercially meaningful outcome for the TPP would provide benefits to all countries involved, their industries and consumers.

“Yet in order to achieve positive results across the board all TPP nations must demonstrate a willingness to negotiate in good faith.”

Countries stand their ground

The principal aim of the TPP negotiations, Mr Robb said, was to try and more seamlessly have a set of rules across 12 countries “who are trading significantly between one another”.

He said Australia was trying to do exactly the same thing with the eastern part of Asia including for China and India “and ultimately bring the two together”.

“It is not a question of America writing the rules,” he said.

“They might think they are but that is why the talks have failed, because the other countries are standing their ground and this will be a deal that hopefully will be attractive to a lot of other countries – including China in due course – one way or another.”

But Australian Greens trade spokesman Senator Peter Whish-Wilson said after five years of “secret negotiations” the failure to reach a final agreement in Hawaii on the TPP “should be a clear signal that the deal is not in our national interest and Australia should walk away immediately”.

“The reported failure to reach a final agreement on highly sensitive issues such as monopoly rights for medicines and Investor State Dispute Settlement (ISDS), which gives corporations special rights to sue our government, should be the final straw for Australia's participation in these dangerous anti-democratic negotiations,” he said.

The National Farmers’ Federation said while it was disappointed the latest round of TPP talks had failed to deliver outcomes on a number of sensitive issues but continued to support a “trade liberalizing pact” to benefit Australian farmers.

The NFF said it remained a firm supporter of the TPP as a key platform to drive increased trade and investment.

“A good agreement will provide significantly improved opportunities for Australian farmers to sell products to markets we know are demanding high quality food and fibre,” a statement said.

GrainGrowers backed NFF’s statement saying the 12 TPP countries currently accounted for 20 percent of Australia’s total grain exports, including the key markets of Japan and Vietnam, which alone averaged more than $1.1 billion per annum in grain export sales over the last three years.

“The Australian grains industry would benefit in particular from enhanced access to the Japanese market which is a highly regulated market with a complex system of mark-ups and tariffs on imports,” a statement said.

The 12 countries negotiating the TPP are Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore, the US and Vietnam. Together they constitute around 40 percent of global GDP.

A third of all Australia’s exports of goods and services are to TPP countries and 45 per cent of the stock of Australian outwards investment.

Colin Bettles

Colin Bettles

is the national political writer for Fairfax Agricultural Media
Date: Newest first | Oldest first


6/08/2015 8:17:29 AM

Unless all provisions for ISDS are removed we should walk away. The two largest beverage makers in the world have stated they are going to move away from refined sugars as sweeteners because of falling demand for their product so where does this leave sugar in 3 to 5 years, I know many households mine included that don't even have sugar in the pantry anymore and this will increase significantly in coming years. There are too many disadvantages for us in the TPP just let it slide.
6/08/2015 12:57:07 PM

This is one of the final pushes from the (bankster kleptocracy) as it seeks to push more of our regulatory framework out of existence. Under our constitution of 1901 under the Commonwealth of Australia which has somehow morphed quietly during the mid 80's to the Australian Government which is listed in Washington D.C on the "securities and investment commission" is an indication of what is happening. There was never a referendum to detach ourselves from the "Commonwealth of Australia" and our sovereignty, the Australian Government is a straw man that only represents corporate cartels.
Hilda Hereford
6/08/2015 4:43:32 PM

Longview, Correct
7/08/2015 6:54:55 AM

Why is sugar so protected in the US? How much is sourced from GMO corn or sugarbeet? could this protection be the way the US govt assists biotech companies to gain market share? Often GMO is said to be a revolution, what if all those economic resources were used to feed the hungry rather than fatten up western citizens? Not only is it subsidies, tariffs etc, GMO stands behind the patent curtain, a govt enforced trade restriction. Once again, these people are cronies.


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