One of the week’s toughest issues was how much to cut dairy tariffs in Canada. Canada, which is the United States’ largest trading partner, is holding elections in October, and the conservative prime minister, Stephen Harper, is reluctant to rouse the ire of dairy farmers who benefit from tariffs of up to 296 percent. U.S.-Canada ties have already been strained over the Obama administration’s failure to approve the Keystone XL pipeline, which would carry tar sands oil from northern Alberta to refineries on the Texas gulf coast.
Canada did offer to reduce the tariffs, but other countries felt the offer wasn’t adequate. New Zealand in particular is eager to gain access to the Canadian dairy market and was not satisfied with the proposal.
In other areas, Japan appeared probable to gradually reduce tariffs on pork and beef but was more reluctant to give access to foreign rice growers.
The United States sought to write in a clause that would help establish safeguards so frivolous lawsuits could not be brought under the investor-state dispute settlement process that was widely criticized by liberal Democrats. The critics said it allows companies to use international arbitration to undercut national regulations.
Japan was also seeking more concessions on what is known as “rules of origin” that determine what national source of auto parts that are made with components from different countries. Japanese automakers want to use components made in non-TPP countries such as Thailand.
The country most notably absent from the talks has been China, the second-largest trading partner with the United States and the biggest trading partner with most of the Asian countries that are part of the accord. Obama has pointedly said that he favors the TPP because he does not want China to be setting lower standards.
“If we are not there helping to shape the rules of the road, then U.S. businesses and U.S. workers are going to be cut out, because there’s a pretty big country there, called China, that is growing fast, has great gravitational pull and often operates with different sets of rules,” Obama said in an interview in June with public radio show “Marketplace.”
Obama said that China had expressed interest in joining the TPP later, but he said that by that time TPP would have set standards and “then China is going to have to at least take those international norms into account.” He said the TPP accord would result in “leveling up, as opposed to a race to the bottom.”
In addition to negotiators, corporate lobbyists and others have been in Maui hoping to corner people involved in negotiations. One was Rep. Sander Levin, D-Mich., who earlier said that he was also concerned about currency manipulation that could artificially boost a country’s exports; the possibility of long protection times for certain drugs and limits in access that could result; and whether goods from non-TPP countries, such as China, could be incorporated into products made by member countries and turn those non-TPP countries into free riders.
Levin said he also wanted the TPP to explicitly reserve the right of member countries to regulate tobacco products.
“It’s always been my goal to have strong bipartisan support for a major trade bill,” Levin said. “There’s been too little meaningful congressional involvement despite all the consultations.”
