The Trans-Pacific Partnership (TTP) is a huge new global trade deal agreed between 12 Pacific Rim nations including the US and Japan. It covers almost 40% of the global economy and is the biggest trade agreement in the past 20 years.
The objective of the deal is to closely link the economies of these nations and reduce barriers to trade, such as taxes on goods traded across borders.
The participating countries include:
- United States
- New Zealand
In a statement made by Obama, he sais, “This partnership levels the playing field for our farmers, ranchers, and manufacturers by eliminating more than 18,000 taxes that various countries put on our products.”
The TTP addresses the 21st century trade issues, such as intellectual property transactions, digital trade rights, and protection for investors.
The agreement is a lot more than a trade deal. It has more than two dozen chapters that cover everything from tariffs to the handling of international investment disputes.
Agreement will lead to more trade which is good for the global economy.
Particularly benefits the multinational corporations as they can product goods in the lowest cost jurisdictions. It also makes it easy for companies to sell goods.
Free trade agreements also come with drawbacks such as export of jobs to countries with lower wages, however, this is generally seen as a positive for the global economy.
Critics consider it as a giveaway to corporate interests and a threat to US sovereignty.