[Ip-health] IUT: USTR Still Developing KEY TPP Proposals, Will Not Table Them Next Week

Peter Maybarduk pmaybarduk at citizen.org
Fri Jun 17 14:53:56 PDT 2011


17 June 2011
Inside U.S. Trade
Vol. 29, No. 24
The Office of the U.S. Trade Representative will not table several key negotiating proposals at the seventh round of Trans-Pacific Partnership (TPP) talks next week, partly because it does not want to do anything that could cause a stir in Congress and jeopardize the passage of three pending free trade agreements with Colombia, Panama and South Korea.
USTR appears uninterested in pushing proposals forward at this time in controversial areas like labor rights and intellectual property protections, as this could upset the delicate political balance that could allow the pending FTAs to pass this summer, sources said.
Partly for that reason, USTR does not intend to table any new text on these so-called "May 10" issues next week. Some sources went so far as to say that USTR negotiators will primarily be in "listening mode" during the Vietnam round next week, and said that the TPP talks were "slowing down" at this stage.
This approach differs markedly from the public message from USTR Ron Kirk last April, who said the he would like to get all U.S. negotiating proposals on the table by the time of the Vietnam round, which kicks off next week.
In addition to labor rights, intellectual property, and environmental protections -- the three areas covered by the May 10 agreement -- USTR will also not table a proposal on disciplines for state-owned enterprises (SOEs) at the seventh round next week, sources said.
USTR hopes to be in a position to table this proposal -- which is a priority for U.S. business groups -- by the time of the eighth round of talks in September, sources said.
Ways and Means Trade Subcommittee Chairman Kevin Brady (R-TX) on June 14 said he was "encouraged" that USTR was taking the time to understand the ramifications of certain proposals, especially the May 10 issues. He said some of these proposals pose "difficult calls" for USTR but that officials are consulting "very closely" with Congress.
Similarly, some Senate Republicans have expressed their preference that USTR hold off from tabling new proposals on the May 10 issues in the near term. They believe that it may make more sense for USTR to table such controversial proposals only after Congress passes the pending trade deals (Inside U.S. Trade, May 13).
While USTR has already tabled a partial proposal on intellectual property rights, which did not cover the most controversial issues, such as data exclusivity, patent term extensions, patent linkage, or protection terms for biologics. All of these topics are the subject of heated debate among U.S. stakeholders.
Similarly, USTR tabled a partial environmental proposal at the last round of TPP talks in Singapore, but that was an initial proposal that left many key questions unanswered (Inside U.S. Trade, April 1).
USTR is also unlikely to table a formal proposal in the controversial area of rules of origin for textiles and apparel next week, sources said. But one source said USTR planned to informally float a "package" of ideas reflecting current U.S. thinking in this area in order to see how TPP partners react and gauge their positions on this issue.
A U.S. trade official this week said it was "incorrect" to say that USTR is "holding off" on tabling these controversial proposals. "We are still developing our proposals on these issues and consulting with stakeholders and Congress," the official said.
Observers say that the Vietnam round will be critical in determining how far the TPP negotiations can go before the November meeting of the Asia-Pacific Economic Cooperation (APEC) forum, where TPP countries plan to unveil some sort of TPP framework deal. However, there are two rounds after the Vietnam round before the APEC meeting.
One observer said that the fact that USTR is not tabling key proposals next week has obvious implications for the pace of the TPP negotiations, and stressed that TPP partners are eager to start examining these proposals.
In a June 15 speech, New Zealand Trade Minister Tim Groser also highlighted the link between U.S. action on the pending FTAs and progress in the TPP negotiations.
He said that the extent to which TPP countries can advance the negotiations this year partly depends on whether the U.S. Congress is able to pass the three pending trade agreements.
"A lot depends on the progress made inside the Beltway on the existing trade agenda," Groser said in a speech at the New Zealand Institute of International Affairs, in reference to what TPP countries can achieve by the time of the APEC summit in November.
According to Groser, there is about a 60 percent chance that the U.S. Congress will be able to approve the pending trade agreements in the short term. "If they do, then my estimate of what is possible on TPP by the APEC Leaders' Meeting moves forward," he said, according to a transcript of his speech.
If the U.S. Congress is unable to approve the pending trade deals in the short term, then Groser said TPP countries will likely only be able to take a "smaller step forward" in the TPP talks by the end of the year. However, he stressed that only taking a "smaller step" this year would not be "fatal" to where TPP negotiators want to go in the long term.
Groser did not explain why passage of the pending trade deals would accelerate progress in the TPP negotiations, although many observers say passage of the pending trade deals will "free up" the U.S. trade agenda.
Groser also said it remains unclear what kind of TPP outcome could be possible by the November APEC summit. He said an "upbeat political declaration" would be on the "very low end" of possibilities, while a "framework agreement" is closer to what may be achievable. "But the crucial question will be what might be contained therein," he said.
While TPP countries will not conclude a deal by November, one observer stressed the importance of achieving as much progress as possible by that point so that it is clear that TPP countries will conclude the talks in 2012. Otherwise, the talks could drag on and never conclude, especially as new countries look to join, this observer said.
Overall, Groser stressed that TPP negotiators are "a long way off" from dealing with the "really tough political questions" that will arise in the talks. One such issue of great importance to New Zealand is improving its access to the U.S. dairy market. One source said this issue would likely not be discussed in any detail until the fall at the earliest.
Alongside the actual TPP negotiations next week, a number of private-sector groups will give presentations on issues of importance to them to negotiators or other industry representatives.
Among the groups presenting in Vietnam are Google, Ford Motor Company, the Pharmaceutical Research and Manufacturers of America (PhRMA), Public Citizen, the AFL-CIO, the American Apparel and Footwear Association, the Retail Industry Leaders Association, National Pork Producers Council and Fonterra Cooperative Group, sources said.  

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