LEESBURG, Va. -- With 1,350 employees in its five U.S. factories, New Balance is proud that it still produces 7 million pairs of shoes each year at its plants in Maine and Massachusetts, the last major athletic footwear company that still has manufacturing jobs in the United States.

But the company says those jobs could very well disappear if the U.S. scraps its tariff on athletic footwear coming in from Vietnam.

It’s part of the mounting anxiety caused by the new Trans-Pacific Partnership, the largest trade pact proposed in U.S. history. And as 400 negotiators from nine countries met privately at a golf resort in northern Virginia last week in an attempt to finalize details, New Balance officials weren’t the only ones fretting.

Autoworkers feared the loss of 26,500 domestic jobs and said the production of American cars would fall if Japan joins the pact and the United States drops a 2.5 percent tariff on Japanese cars, making them cheaper to buy.

Doctors worried that it will be harder to get medicines to fight AIDS and other diseases in developing countries if U.S. negotiators insist on extending patents for pharmaceutical companies.

And many members of Congress and other critics lamented that such big decisions were being made in secret meetings, at a luxury resort in the Potomac River Valley, far from public view.

But while opponents derided the new trade pact as “NAFTA on steroids,” a reference to the huge North American Free Trade Agreement passed by Congress in 1993 that opponents say led to U.S. jobs moving to Mexico, backers predicted the Trans-Pacific deal would increase U.S. exports, create more jobs and lower prices for American consumers.

More countries may join

Negotiations include nine countries: the United States, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam. Mexico and Canada will soon formally join the talks, bringing the total membership to 11 countries. Japan already has expressed interest in participating, and China is regarded as a potential partner down the road.

“It’s NAFTA on steroids in terms of its geographic scope, its economic scope and the new powers it gives to corporations,” said Arthur Stamoulis, a critic of the trade deal and executive director of the Citizens Trade Campaign, a coalition that includes labor and environmental groups.

The deal is an attempt to get the United States to cash in on a region that accounts for more than 40 percent of all international trade. In addition to eliminating many tariffs, negotiators hope to reduce regulations and the cost of trade, to promote more digital and “green” technology, and to come up with rules on a wide variety of topics, addressing everything from sanitary standards to customs procedures to environmental issues. The Asia-Pacific region is an increasingly important market for U.S. businesses, accounting for $775 billion in exports in 2010, a 25.5 percent increase from just a year earlier.

Secret meetings

While specific details of the negotiations have been kept secret, some documents have been leaked. Responding to one leak, the group Doctors Without Borders said it fears that the pharmaceutical industry will prevail in its fight to protect brand-name medicines, making it much more expensive for developing countries to gain access to cheaper generic drugs that would help treat victims of AIDS and other diseases. The industry argues that patents help drug manufacturers protect their investment and raise money for new research, noting that it can cost $1 billion, on average, to develop one new medication.

In June, more than 130 House members sent a letter sent a letter to U.S. Trade Representative Ron Kirk asking for more oversight of the negotiations from both Congress and the public.

Assistant U.S. Trade Representative Carol Guthrie said the negotiators met with 450 members of the public and heard presentations from more than 90 groups during last week’s talks. And she said the Obama administration has hosted hundreds of briefings for members of Congress to keep them updated on every step of the talks.

But she defended the private negotiations, saying in an interview “there is a certain level of confidentiality that has to be maintained in order to preserve the United States’ strategic negotiating ability.”

September 23, 2012

Source: News Observer

• Exporting to the Canadian market: Breakthrough opportunity
• Vietnam advised to fully tap CPTPP to boost exports to Canada
• Vietnamese export goods face increasing trade defence measures in CPTPP markets
• Seminar discusses trade defence risk mitigation for exports to CPTPP
• US loses case over access to Canadian dairy market