TPP countries will “assess options” for deal’s future without US

TPP countries met in Vietnam on the fringes of an APEC meeting this month to discuss the future of the failed deal, which Japan, Australia and New Zealand are pushing to resuscitate.

While there’s been a lot of hype in the headlines about a TPP revival, the actual statement agreed by TPP countries only commits them to completing a process to “assess options” for the future of the agreement before Ministers meet again at Da Nang, Vietnam on November 10-11.

As we have explained previously, the TPP in its current form can’t come into force without the US. This means that the deal must be either completely renegotiated or at the very least be changed to remove clauses referring to the US. In either case, it would become an entirely new agreement and would have to go through parliamentary processes again in each country.

Little consensus between TPP countries

There was strong community opposition to the TPP because it extended monopoly rights on medicines, restricted other forms of public interest legislation and allowed foreign investors to sue governments in international tribunals.

letter signed by national and international health organisations from TPP countries urged governments meeting in Vietnam to abandon TPP provisions which would harm public health.

While Japan, Australia and New Zealand want to revive the deal with as many countries and as few changes as possible, some other TPP countries only reluctantly agreed to provisions like medicine monopolies and investor rights to sue governments in order to gain access to US markets. Canada and Mexico may be cautious about how a revived deal could impact on NAFTA renegotiations and Vietnam and Malaysia are likely to want major revisions.

Malaysia has said if the TPP proceeds without the US it should be renegotiated. Trade Minister Mustapa said access to the US market was one of Malaysia’s “major motivations” to be part of the TPP, and that "In the event it’s TPP minus one, in our view it cannot be the one that was agreed in Auckland in February 2016."

Canada’s trade minister also acknowledged that the changes would need to go beyond simply taking the US out of the deal. Canadian officials told the Toronto Sun that “even the countries most enthusiastic about the previous agreement understand that it must be significantly altered before it can move forward.”

Even Australia’s position seems to be inconsistent. The Australian reported that Australia may try to reduce monopoly rights for pharmaceutical companies on biologic medicines. However there were also reports that Trade Minister Steven Ciobo was advocating to keep the deal as it is, saying the deal could become “unstitched” if it were altered.

Much of the motivation to move forward with the TPP without major changes is in the hope that the US will re-join the deal at some point in the future. However, U.S. Trade Representative Robert Lighthizer reiterated after the meeting that the US will not be revising its position on leaving the TPP.

No bipartisan support in Australia

Even if TPP countries do decide to go ahead with a modified deal, there’s no guarantee it would be able to be ratified here in Australia.

Labor’s trade spokesperson Jason Clare told the AFR: "The TPP signed in New Zealand last year is dead… If this gets up it will be a different agreement. The Turnbull Government is trying to mislead people because the Prime Minister couldn't convince Donald Trump to ratify the TPP."

This is consistent with Opposition Leader Bill Shorten’s confirmation in his budget reply speech that Labor won’t back Coalition Government efforts to revive the TPP without the US.

Even with the US involved, the market access benefits the TPP was predicted to deliver to Australia were negligible, and would be even less without the US. An Australian Senate inquiry rejected the deal’s implementing legislation. A revived TPP with similar content would again be opposed by the Senate majority.

The Australian Government should not waste further time and resources trying to revive the dead TPP.

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Updated 1 June 2017