Trading Up: TPP Negotiations Present an Unprecedented Opportunity to Open Large, New Markets to U.S. Manufactured Goods

By November 21, 2013Trade

As TPP discussions this week in Salt Lake City reach the halfway point, manufacturers in the United States want to highlight the importance of all countries at the table keeping their focus on ambitious, concrete, new market access outcomes that are critical to achieving the pro-growth and pro-jobs outcomes that the TPP Leaders themselves have enunciated.

With TPP countries having a combined market of $28 trillion in GDP and almost 800 million consumers that account for about 40 percent of global trade, the TPP’s potential to drive new growth and opportunity for manufacturers in the United States is substantially larger than any prior trade agreement that the United States has negotiated.

For manufacturers to benefit from the TPP, new market access is critical. As described in detailed public comments submitted to USTR in June, manufacturers are specifically seeking a TPP agreement that opens markets by eliminating both tariff- and non-tariff barriers, promoting fair competition and further liberalizing procurement and investment markets. The final agreement must ultimately put manufacturers in the United States on a level playing field in each of those TPP markets vis-à-vis both domestic competitors, but also with competitors from third countries that already enjoy preferential access into several of these markets through other negotiated agreements that exclude the United States. With regard to tariffs, the NAM continues to urge their immediate and comprehensive elimination. Achieving a successful TPP agreement, that will boost manufacturing in the United States, will only occur if manufacturers are assured that their U.S. exports will not be at a competitive disadvantage to third country exporters in any of the TPP markets.

While eliminating tariffs immediately is a highly important TPP outcome, it is even more critical that negotiators address the structural and non-tariff barriers (NTBs) that manufacturers encounter when seeking to export, make sales and invest in TPP countries. The final agreement must eliminate government distortions that limit access, from non-tariff barriers and the lack of transparency to non-commercially based activities of state-owned enterprises that undermine fair competition. The TPP needs to resolve concretely longstanding market access issues that have impeded U.S. exporters’ access into TPP markets, particularly into markets like those in Japan, Malaysia and Vietnam.

And all such outcomes must be fully enforceable through binding dispute settlement, including for the new and stronger rules on sanitary and phytosanitary measures that the parties are negotiating. There seems little point to negotiating strong outcomes if they are not backed up by state-of-the-art dispute settlement.

In short, ambition is need across the negotiations to achieve effective and substantial new market access.

As TPP Leaders laid out clearly at the 2011 APEC Leaders’ Meeting in Honolulu:

  • We are confident that this agreement 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.

These types of strong and pro-growth outcomes are ones on which all should agree. To deliver on this pledge, the final TPP must achieve real results that create commercially meaningful opportunities for our manufacturers large and small, sustain and create jobs, and enhance manufacturers’ competitiveness in an increasingly difficult global economy.

Trading Up is a blog series from manufacturers, which focuses on the need for a comprehensive, high-standard Trans-Pacific Partnership (TPP) that eliminates barriers, creates concrete new market access and levels the playing field for manufacturers in the United States.

Linda Dempsey

Linda Dempsey

Linda Dempsey is the vice president of international economic affairs at the National Association of Manufacturers (NAM). In this capacity, Ms. Dempsey leads the NAM’s efforts to improve the global competitiveness of manufacturers in the United States by advocating intellectual property protection, increased export financing and the elimination of trade barriers as well as pushing for agreements and treaties to open up new export markets to create jobs. Ms. Dempsey is noted for her experience on a wide range of international trade and investment policy issues.
Linda Dempsey

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