The 18th round of the Trans-Pacific Partnership (TPP) negotiations in Kota Kinabalu, Malaysia, ended late last month, with accelerated progress being made on a wide range of technical issues in areas related to market access, rules of origin, technical barriers to trade, among others.

Ms Deborah Elms, Head of the Temasek Foundation Centre for Trade & Negotiations (TFCTN) at the Nanyang Technological University in Singapore, believes that after the Malaysia round, the TPP seems to have accelerated their pace.

She said: “[The negotiators] are trying to get the technical details sorted before the leaders meet at APEC in October. That will clear the way for the political decisions to be made in the fall and the whole thing could possibly be wrapped up by the end of the year or, at worst, early next year.”

Negotiators are now continuing to engage regularly to agree on next steps for the 19th round of negotiations taking place in Brunei from 22-30 August.

The TPP agreement is one of two regional trade deals which are currently under negotiations. These agreements – the TPP and the Regional Comprehensive Economic Partnership (RCEP) – could have wide-ranging benefits for food businesses trading in Asia.

The TPP launched in 2010 consists of 12 members, including: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States and Vietnam. Meanwhile, the RCEP encompasses the ten ASEAN members plus China, Japan, Korea, India, Australia and New Zealand.

In the first instance, both agreements aim to simplify the current ‘noodle bowl’ of Free Trade Agreements (FTAs) by creating a regional trading space. Indeed, TPP and RCEP are officially considered to be paths towards the creation of the larger ‘Free Trade Area of the Asia Pacific’ (FTAAP) in APEC. As such, these agreements should in theory be complementary and ultimately work together to create an even greater trading space covering the 21 APEC member countries.

Both these agreements are stated to be ambitious, and thus will require significant negotiating capacity from their respective members.

TPP links both sides of the Asia Pacific region and it is squarely focused on delivering an ambitious, high quality and comprehensive outcome. It is hailed as a “high quality, 21st century agreement” though with the agreement still under negotiation it is hard to define what this will mean. What is clear is that it is substantial in scope, including ‘behind the border’ measures such as technical barriers to trade and regulatory harmonisation; and depth, as it builds on a dense network of existing trade agreements.

In the case of RCEP, its scope is equally ambitious as it is set to cover “trade in goods, services, investment, economic and technical cooperation, intellectual property, competition, dispute settlement and other issues”. It will however offer special and differential treatment and flexibilities for least developed members. It has a particularly ambitious timeframe – with the first round of negotiations in May 2013, RCEP is expected to be completed by 2015.

Commenting on the significance of these negotiations, Fonterra’s Vice President for Government and Industry relations, James McVitty, said: “These regional trade agreements are an important opportunity to open up key markets for food trade that are currently protected. Open trade has a crucial role to play in addressing inclusive growth, poverty elimination and food security. With the global economy as it is right now, trade and investment are the only means to deliver sustained economic growth. ”

Both TPP and RCEP will require levels of commitment in potential new areas at a time when there is incomplete market opening even among ASEAN countries, as member states struggle to meet their 2015 targets for the ASEAN Economic Community (AEC).

“With only some ASEAN countries poised to enjoy the benefits of TPP (currently Brunei, Malaysia, Singapore and Vietnam); and RCEP poised to link ASEAN’s dialogue partners – including China and India – for the first time, it is more important than ever for ASEAN to complete its goals under the AEC,” said Ms Elms.


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