House examines TPP trade deal

The House Ways and Means Subcommittee on Trade recently held a hearing titled “Advancing the U.S. trade agenda: Benefits of expanding U.S. agriculture trade and eliminating barriers to U.S. exports.” In his opening remarks, Chairman Devin Nunes, R-Calif., voiced his concern that Japan was not being held to the standards that the Trans-Pacific Partnership (TPP), a 12-nation free trade agreement (FTA) of Pacific Rim countries, set out to meet.

“If any countries insist on retaining tariffs, then we must complete the negotiations without them and allow them to rejoin when they can commit to full tariff elimination,” Nunes said.

Japan continues to demand certain agricultural products, including pork and beef, be excluded from tariff elimination. In addition to being the largest value market for U.S. pork exports ($1.89 billion in 2013), Japan is the fourth largest market for the rest of U.S. agriculture, which shipped $12.1 billion of food and agricultural products to the island nation in 2013.

A final TPP agreement that does not eliminate all tariffs and non-tariff barriers on U.S. pork products will negatively affect U.S. pork exports for the next 20 years, meaning billions of dollars less in U.S. pork sales and tens of thousands fewer U.S. jobs. For the National Pork Producers Council to support a final TPP agreement, Japan needs to eliminate all tariff and non-tariff barriers on U.S. pork and pork products.

Witnesses who testified at the hearing included Iowa State economics professor Dermot Hayes and National Cattleman’s Beef Association President Bob McCan. Both voiced extreme concern for the position of the Japanese and called for the elimination of tariffs.

Beef producers from four TPP member countries continue to demand that any agreement be a high quality deal that eliminates all tariffs on beef.  Members of the Five Nations Beef Alliance (FNBA) from Australia, Canada, New Zealand and the United States, urge all participants involved in the TPP negotiations to re-commit to securing a comprehensive, non-discriminatory outcome one which eliminates tariffs and importantly addresses behind the border trade barriers.

FNBA is concerned that TPP members have not been able to craft a tariff-eliminating deal for beef, and unless all parties step up to the plate and reaffirm their commitment to a trade liberalizing outcome, countries could begin to drift away from the goal of achieving a 21st century agreement.  FNBA producers expect an accord, which addresses commercial impediments. Above all, a TPP agreement must make it easier to do business by facilitating and enhancing trade. FNBA also calls for each TPP member country to provide the same market access arrangements to all other members, in order to ensure that competitive disadvantages are not created and trade subsequently distorted.

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