Will the Trans Pacific Partnership offer investment opportunities? Providing that Obama gets fast track authority an agreement needs to be reached with the dozen nations currently involved. Each sovereign nation has its own agenda. But, let us assume that, like NAFTA, a deal will be hammered out. Will there be investment opportunities that arise from a Trans Pacific Partnership? First here is some background info.
Trans Pacific Partnership
The Trans Pacific Partnership (TPP) is a proposed investment treaty involving as many as a dozen nations located around the Pacific Rim. Nations currently involved in negotiations include the following:
- Australia
- Brunei
- Canada
- Chile
- Japan
- Malaysia
- Mexico
- New Zealand
- Peru
- Singapore
- United States
- Vietnam
The stated goal of the Trans Pacific Partnership is to enhance trade and investment among member nations thereby promoting growth, development and innovation. Assuming that this agreement comes to pass will it help investors?
Tradeoffs of Free Trade Agreements
The International Business Times notes that public interest policies of member nations may be hurt by joining the Trans Pacific Partnership.
The country of Vietnam wants to make baby formula more affordable for its citizens. American trade negotiators think that’s a bad idea. The measures are among more than a dozen public interest policies adopted by governments involved in talks for the Trans-Pacific Partnership (TPP) that the U.S. considers “barriers to trade,” according to the latest annual National Trade Estimate Report On Foreign Trade Barriers, a document prepared by the Office of the United States Trade Representative (USTR).
In the more than 400 page long report, U.S. negotiators openly acknowledge goals that are odds with the Obama administration’s repeated assurances that TPP will not undermine the ability of pact members to regulate in the public interest.
These sorts of issues need to be hammered out before the Trans Pacific Partnership becomes reality.
Benefits of the Trans Pacific Partnership
Forbes weighs in on the side of the Trans Pacific Partnership.
This far-reaching free trade agreement amongst twelve nations in the Americas, Oceania, and East Asia, is expected to yield significant results. It will bolster the economy and support innovation, create jobs and increase national security.
The author laments the lack of meaningful public discourse on the effects of the TPP aside from the assertion that it will lead to the loss of American jobs.
Free Trade Is Good for the USA
According to The New York Times economists agree that free trade is good. In a letter to congressional leaders, thirteen past chairmen of the president’s council of economic advisors wrote this.
“International trade is fundamentally good for the U.S. economy, beneficial to American families over time, and consonant with our domestic priorities. That is why we support the renewal of Trade Promotion Authority (TPA) to make it possible for the United States to reach international agreements with our economic partners in Asia through the Trans-Pacific Partnership (TPP) and in Europe through the Trans-Atlantic Trade and Investment Partnership (TTIP).”
Investment benefits from the Trans Pacific Partnership will be across the board. One can expect widely spread economic gain and profits in the sense that a rising tide raises all ships. Obviously those nations that compete most aggressively will win. The USA stands to benefit by knocking down trade barriers to agricultural as well as high tech and information technology products.
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