Opposition of Emerging Countries

The ministers meeting of Trans-Pacific Partnership in Hawaii was adjourned without agreement on some crucial areas such as dairy products or intellectual property. The joker was not Canada, but New Zealand. N.Z. requested high-level free trade on dairy products, while opposing protectionism of United States in intellectual property of medicines. Japanese government joined concerted accusations against N.Z. But, N.Z. was simply requesting free trade without exception as TPP had originally been targeting.

On dairy products, Japan wanted to introduce low-tariff quota from N.Z. or Australia as much as 75 thousand metric tons a year, to which N.Z. strongly opposed. For N.Z., dairy product is one of the most important goods for export, occupying 30% of all exports. One of the politicians most loyal to economic bureaucrats, Akira Amari, or Minister in charge of TPP, accused N.Z. as “a specific nation with rigor,” as if Japan was not responsible for deadlock of the negotiation.

N.Z. also opposed to U.S. argument to set twelve-year protection for intellectual property on newly developed medicines, demanding five years or less for the protection with other emerging countries. Although the parties continued official level meeting to find compromise, the time for negotiation in Hawaii was expired.

N.Z. defended its insistence on national interest. “It always happens on us to have problem with countries incompetent in dairy products,” told N.Z. Minister of Trade, Tim Groser. He dismissed possibility for N.Z. to get out of the negotiation, saying that it was one of the nations that created TPP. He was definitely true. TPP started as entire non-tariff agreement by N.Z., Chile, Brunei and Singapore. For N.Z., it was U.S. or Japan who joined later and changed the rule of game by bringing certain amount of protectionism for national interests.

U.S. required next meeting as early as late August. Although President Barack Obama obtained trade promotion authority from Congress, the negotiation needs to be settled as soon as possible not to affect politics over presidential election next year. To get agreement and ratification on TPP from Congress by the end of this year, this July was regarded as the last chance. To finish the process before Democrats and GOP will embark on caucuses or primaries, August must be the deadline.

But, it will be disastrous for multi-lateral trade negotiation to introduce egoism of a great power. If the true purpose of TPP should be focused on making a high trade standard in Asia-Pacific region, it is necessary to establish a broad and comprehensive framework to make it sustainable and competitive.