U.S. trade official says to seek TPP deal by year-end

Reuters

By Randy Fabi and Lesley Wroughton

NUSA DUA, Indonesia, Oct 8 (Reuters) - The United Statesmaintained it hopes to seal an ambitious trade pact on scheduleby year-end despite resistance in some countries and the absenceof President Barack Obama from a regional summit that isironing out differences on the pact.

U.S. Trade Representative Michael Froman said on Tuesdaythat world trade ministers may discuss the U.S.-proposedTrans-Pacific Partnership (TPP) on the sidelines of a WorldTrade Organization meeting that starts on Dec. 3, with a goal ofreaching a deal by year-end.

But several outstanding issues remain, he told reporters atthe Asia-Pacific Economic Cooperation (APEC) summit on theIndonesian island of Bali, citing issues ranging fromintellectual property to state-owned enterprises, labour and theenvironment. The WTO meeting will also be held on Bali.

The three-year-old TPP talks, now involving 12 nations, areaimed at establishing a free-trade bloc that would stretch fromVietnam to Chile to Japan, encompassing 800 million people,about a third of world trade and nearly 40 percent of the globaleconomy.

A major goal of the Obama administration, the TPP would teardown trade barriers in areas such as government procurement andset standards for workers' rights, environmental protection andintellectual property rights.

Obama had hoped to settle the outstanding issues indiscussions with other leaders at the APEC meeting but wasforced to cancel his visit because of the fiscal standoff andpartial government shutdown in Washington.

The TPP, by seeking unprecedented access to domesticmarkets, is proving highly sensitive in developing countriessuch as Malaysia and Vietnam, whose political systems could beshaken by intrusions in areas such as government procurement andstate-owned enterprises.

Japanese news agency Kyodo said leaders of countriesinvolved in the TPP negotiations, including Japan, willreiterate a pledge on Tuesday to conclude a deal within theyear, saying they have made "significant progress" at the APECsummit.

The leaders' statement is unlikely to state the 12 TPPcountries have agreed in principle on the pact but is expectedinstead to say they are "on track" to meet the envisioneddeadline, Kyodo reported.

'NOT SUBSTANTIALLY FINISHED'

Proponents call the TPP, the most ambitious trade pact sincethe demise of the Doha round of global talks, a "high-standard"agreement to eliminate tariffs and tackle an unprecedented rangeof non-tariff barriers that restrict growth.

Obama has touted the deal by saying that 5,000 U.S. jobs arecreated for each extra $1 billion in exports created under thepact.

For the United States, the TPP would complement its shift ofdiplomatic and military resources to Asia to tap the region'sfast growth and balance the growing influence of China, whichhas not joined the pact.

To its opponents, including a range of advocacy groupsglobally, the TPP represents an encroachment of U.S. economicmight that gives big corporations unprecedented powers tochallenge national policies in the name of free trade.

More intrusive than other trade pacts, the TPP seeks toregulate sensitive areas such as government procurement,intellectual property and the role of state-owned enterprises aswell as giving corporations more rights to sue governments.

In TPP nations such as Malaysia, Japan, and Vietnam,reform-minded leaders are seen as using the pact as externalleverage to break down vested interests and force liberalisationof protected, inefficient sectors.

The Singapore Straits Times newspaper said a draft statementto be released on Tuesday shows that leaders will likely reportthat TPP talks are not "substantively finished".

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