San Diego the host of the 13th Round of TPP Negotiations
By Adina Moloman
Sources: The Institute for Policy Innovation, Office of the United States Trade Representative
The 13th round of Trans-Pacific Partnership negotiations will be held in San Diego July 2-10, 2012. The Trans-Pacific Partnership agreement basically represents a new Asia Pacific free trade Agreement between countries members where tariff and non-tariff barriers are eliminated.
This is an ideal scenario, but given the variation in geography, population, and economic development among TPP countries, the type of trade and investment varies and also the tariff structure, which might cause potential difficulties in liberalizing trade between such diverse countries.
Although average tariff rates among all products are below 10% for TPP countries, some industrial and agricultural sectors have relatively high tariff, especially in the case of the US, where its average tariffs for other products are less than 4% but the U.S. tariff rate on dairy products is 20%.
The current TPP countries are United States, Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam. President Obama announced a few days ago that Mexico has been formally invited to join the Trans-Pacific Partnership negotiations which might bring new opportunities for the Mexico Maquiladora Industry.
With Mexico expanded market in the Asia-Pacific region might create new opportunities and higher returns for U.S. transnational corporations operating in Mexico, considering that the U.S. is the main source of foreign direct investment (FDI) to Mexico. A direct consequence is that the US will consider a good destination to reinvest and creating more jobs locally.
It is still recent to talk about the trade benefits for Mexico, considering that a condition stipulated by the United States to back its entrance is that Mexico would not be able to reopen any agreements that have already been reached among the current nine TPP partners, unless the members think other way.
