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Trade News: TPP, T-TIP Negotiations Continue, but Challenges Remain

Jul 23, 2014

Trade News is a periodic update that provides a concise compilation of current trade happenings and their impact on the dairy industry. This week's column by Beth Hughes, IDFA director of international affairs, discusses negotiations surrounding the Trans-Pacific Partnership (TPP), the Transatlantic Trade and Investment Partnership (T-TIP) and the AD/CVD case against imports of Mexican sugar.


Trans-Pacific Partnership (TPP)

The TPP ministers met in Ottawa, Canada, July 3-12. No progress was made with Japan on dairy or other sensitive agriculture products, and Canada still is unwilling to negotiate on market access. The next round of bilateral talks between the United States and Japan on market access will take place in Washington, August 4-5.

November may be the new deadline for completing TPP. A recent Reuters article quoted President Barack Obama as saying, "Our hope is by the time we see each other again in November, when I travel to Asia, we should have something that we have consulted with Congress about, that the public can take a look at, and we can make a forceful argument to go ahead and close the deal."

However, several U.S. legislators have stated they will not support TPP if it comes to Congress without Trade Promotion Authority being enacted first. See related story below.

Transatlantic Trade and Investment Partnership (T-TIP)

The latest round of talks between the United States and the European Union were held July 14-18 in Brussels, Belgium. Although initial tariff offers were exchanged in February, neither side has made a second offer.

The United States is seeking full tariff elimination, but the EU has signaled that it is seeking protection for sensitive agriculture products such as poultry, beef and pork. Regulatory cooperation efforts have also hit a snag, with media reports suggesting that the idea of moving regulatory negotiations outside of T-TIP negotiations is gaining support.

At the close of the round, U.S. Trade Representative Michael Froman said, “The sixth round of Transatlantic Trade and Investment Partnership (T-TIP) negotiations ended earlier today in Brussels. U.S. and EU negotiators worked productively this week to identify paths forward across the negotiations. Opportunities for a major upgrade of one’s biggest economic relationship do not come along often, and we cannot afford to squander this one. I applaud the efforts of the teams for exploring creative ways to open markets to support job creation, growth and competitiveness, including by bridging divergences in our regulatory regimes, without compromising the level of health, safety and other regulations our people have come to expect.”

The next round of negotiations will likely take place in September in the United States.

Trade Promotion Authority (TPA)

The Republican members of the House Ways and Means Committee sent a letter to Ambassador Froman last week, urging the administration to enact Trade Promotion Authority before completing the Trans-Pacific Partnership deal.  In the letter, members say they “will not support TPP if the agreement, even an agreement in principle, is completed before TPA is enacted.”  

IDFA supports TPA and the legislation introduced by former Senate Finance Committee Chairman Max Baucus (D-MT), Finance Ranking Member Orrin Hatch (R-UT) and House Ways and Means Committee Chairman Dave Camp (R-MI) in January. The bill includes several key negotiating objectives, such as the reduction or elimination of tariffs, robust rules on sanitary and phytosanitary measures, and preventing the improper use of geographical indications, all of which make it easier and less costly for U.S. dairy companies to compete globally.

IDFA is a member of the Trade Benefits America Coalition, which is advocating for passage of TPA.

Sugar Antidumping and Countervailing Duties Cases

IDFA and other members of the Coalition for Sugar Reform sent a letter to key federal officials last week, urging the administration not to enter into negotiations with Mexico on a managed trade agreement. In the letter, coalition members said, “Such an agreement would be particularly inappropriate in the case of sugar, a U.S. industry that already receives tremendous government protection from market forces at the expense of U.S consumers and U.S. taxpayers.”

On March 28, a group of domestic sugar producers filed antidumping and

countervailing duty (AD/CVD) petitions with the U.S. Department of Commerce and the U.S. International Trade Commission (ITC) against Mexican sugar exports to the United States.  These proceedings have statutory timetables, and a final decision regarding duties will likely be rendered by May 2015.

Senate Confirms Darci Vetter as New Chief Ag Negotiator

Earlier this month, the U.S. Senate confirmed Darci Vetter to replace Islam Siddiqui as chief agricultural negotiator in the Office of the U.S. Trade Representative. Vetter previously served as the deputy under secretary for Farm and Foreign Agricultural Services in the U.S. Department of Agriculture.

The position of chief agricultural negotiator, which holds the rank of ambassador, was created by Congress in 1997 to ensure that U.S. agriculture is fully represented in trade negotiations at the highest level. During her Senate confirmation hearing in May, Vetter mentioned specific areas where USTR and Congress need to work together, including market access for U.S. dairy in Japan and Canada, as well as geographical indications (GIs).

For more information, contact Beth Hughes, IDFA director of international affairs, at bhughes@idfa.org.

 
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