America’s bargaining power in trade deal negotiations undermined without TPA

By Poorna Rodrigo

- Last updated on GMT

Without TPA, US trade negotiators’ bargaining power is seriously undermined, said Grier
Without TPA, US trade negotiators’ bargaining power is seriously undermined, said Grier

Related tags National pork producers World trade organization International trade Us

America’s chances of promoting pigmeat exports by striking trade agreements under discussion such as the Trans-Pacific Partnership (TPP) or the Transatlantic Trade and Investment Partnership (TTIP) are slim, if President Barack Obama is not given authority to present deals to Congress for simple ‘yes’ or ‘no’ votes.

So says the USA’s National Pork Producers Council (NPPC), which has released a statement stressing the value of US trade promotion authority (TPA), which sets the goals and priorities for any trade deal that the US president is negotiating, but gives him a free hand in how to achieve it. It also prevents Congress from imposing amendments to deal packages, which would cause renegotiation and probably unwind any international trade deal.

The NPPC is calling on Congress to pass legislation giving Obama TPA powers: "TPA helps the US pork industry by ensuring that free trade agreements can more easily be approved, and free trade agreements are vital to US pork producers,"​ NPPC director of communications Dave Warner told​.

Ongoing TPP talks, involving the US and other Pacific Rim countries – for instance Vietnam – which would remove tariff and non-tariff barriers in trade between them are crucial, said Warner, calling it indeed "the ‘de facto’ world trade talks",​ given that the World Trade Organisation’s (WTO) Doha Development Round talks "seem to be dead".​ He added: "What comes out of these negotiations will set the standard for all future trade negotiations."

The crux of the TPA legislation is that it gives confidence to trade negotiation partners that Congress will not undo a deal through amendments during the ratification process. "If it could, no country would negotiate with the US, knowing that things they agreed upon during the negotiations could be undone by Congress,"​ said Warner.

By definition, "TPA establishes consultation and notification requirements for a president to follow throughout the negotiation process,"​ added livestock and meat market analyst Kevin Grier at the Canada-based Kevin Grier Market Analysis and Consulting Inc. "Once negotiators reach a deal, however, Congress would have to vote up or down on the treaty, with no amendments or filibusters."​ Congress has granted TPA to every president since 1974, with the most recent law approved in August 2002 and expiring in 2007.

But without TPA, US trade negotiators’ bargaining power is seriously undermined, according to Grier. "It weakens the US negotiators’ hand and gives little incentive for trading partners to seriously negotiate," he said.  And as the US National Pork Producers Council said, "passage of legislation renewing TPA would send a strong signal to the TPP countries and to the world that the US is committed to expanding global trade",​ added Grier.

After all, the US pork industry has been battling other issues such as "an appreciating US dollar, Russian meat ban, Chinese trade policy volatility and unreliability",​ he added. Renewing TPA could now push the TPP negotiations to a conclusion and encourage the TTIP talks with the European Union, Warner added.

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