Other Countries' Interest in TPP Highlights Deal's Strength, State Official Tells WITA
Widespread interest among other countries in joining the Trans-Pacific Partnership underscores the agreement's strength, State Department Assistant Secretary of State for Economic and Business Affairs Charles Rivkin during a Jan. 14 forum in Washington. "As our prosperity and security are inextricably tied to the region, so too are foreign policy and economic policy inextricably linked to each other," he said. "Trade issues cannot be separated from larger questions about America’s global leadership." The Washington International Trade Association hosted the event (here).
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The TPP "brings groundbreaking new rules to the table," he said. "That means consumers and producers alike in TPP economies benefit from the full spectrum of business. And while others try to build walls around the Internet, rules in TPP help to ensure the free flow of data across borders. We know TPP offers an attractive alternative to the current environment because numerous economies have loudly expressed their interest in joining the agreement."
Rivkin also talked about a recent trip he took to Asia, where he said Taiwan, South Korea, and Indonesia are also interested in joining the agreement. He noted that Jakarta was “hell-bent” on its conclusion and quick implementation, and has worked to persuade Indonesian citizens to support freer trade, in part, to engender support for TPP, which many expect will foster greater economic integration between NAFTA and Asian countries—even those not party to the pact.
After Capitol Hill lawmakers earlier this week indicated they were ramping up their analysis of the automobile provisions in the (see 1601120051), Rivkin didn't directly address a question regarding whether the pact’s lower-than-NAFTA thresholds for auto manufacturing would hurt U.S. car producers and allow non-TPP nations to unfairly capitalize in a shifted market framework.
“I think it would probably be more productive to go into this issue in greater detail," he said. "Nonetheless, TPP eliminates import taxes as high as 70 percent on some automotive products in TPP countries," Rivkin said in response to a reporter’s question before pivoting to tout the agreement for its overall perceived benefits and highlighting the complexity of its negotiations. “We’re talking about 18,000 taxes and tariffs reduced, and new markets in dairy and rice and fruit and wines and vegetables and things. It’s a complex deal, and no matter what topic you talk about, I promise you there have been thousands of hours of discussions in negotiations on it, and in any deal, not every single person is in on it, but we’re confident that what we’ve negotiated is the best possible outcome. But I really think, given the importance of your question, I’d rather defer it to the panel."
The agreement between the U.S. and 11 Pacific Rim nations proposes a 45 percent regional value content rule of origin, in contrast with NAFTA, which has a 62.5 percent threshold. Nicole Bivens Collinson, president of trade negotiations and legislative affairs for Sandler Travis said the new rules of origin could benefit large manufacturers, as nations further specialize their individual links of the global supply chain, or “global value sourcing chain,” Bivens Collinson said. “[Car manufacturing is] going to need that country to produce the belts that are used on your seatbelt; it’s going to another country to produce the type of material that goes into making mufflers and keeping it quiet, and so as countries become more specialized, you realize there’s no need for everybody to have that type of plant in their country.”