Spotlight: Political uncertainty clouds prospects for Pacific trade talks

Trade ministers of the U.S. and 11 other Pacific Rim countries on Wednesday gathered in Atlanta in another attempt to conclude the ambitious trade deal, with outstanding thorny issues increasingly embroiled into political campaigns in Canada and the United States.

The Obama administration had planned to complete the 12-nation Trans-Pacific Partnership (TPP) trade agreement in the last round of talks in July and submit the deal to Congress by the year's end, paving the way for congressional approval before the 2016 U.S. presidential campaign heats up.

But top trade negotiators of the 12 Pacific Rim countries failed to reach a final deal two months ago with key obstacles remaining in the areas of market access and intellectual property. That failure means it's very unlikely for TPP leaders to sign a deal this year as the U.S. president has to notify Congress 90 days before signing a trade agreement, according to trade experts.

However, as Canada, the third-largest economy in the TPP framework after the U.S. and Japan, has shifted into federal election campaign mode, trade ministers are under pressure this week to get an agreement before the Canadian federal election on Oct. 19. While Canadian Prime Minister Stephen Harper is a strong supporter of the TPP, his prospect in the federal election remains unclear.

"The Canadian government actually wants to get the deal done before election," Jeffrey Schott, a senior fellow and trade expert at the Washington-based Peterson Institute for International Economics, told Xinhua, noting that they understand Canada has to be part of the TPP agreement.

According to Schott, there are mainly three sticking points remaining in the TPP trade talks after over five years of negotiations: agricultural market access for dairy, rice and sugar, rules of origin for autos and auto parts, and the duration of intellectual property protections for a new class of drugs known as biologics.

Negotiators said they have made progress in these areas in the past several weeks, but it's not clear whether they are ready to make final concessions and seal a deal this week. Senate Finance Committee Chairman Orrin Hatch has urged the U.S. negotiators not to rush to close the negotiations if it means "getting a less-than-optimal result" for the country.

"If the administration and our negotiating partners do conclude an agreement this week, they can be sure that I will examine it very carefully to ensure it meets these standards," Hatch said Tuesday in a speech on the Senate floor. "As I have stated many times before, if the agreement falls short, I will not support it. And, I don't think I'll be alone on that."

Even if TPP trade ministers reach a deal this week, the earliest date for a final TPP vote in U.S. Congress would be in February 2016, when presidential nomination contests kick off in the early voting states including Iowa and New Hampshire, according to trade experts at Public Citizen, a consumer advocacy organization in Washington D.C.

Several Republican and Democratic presidential candidates have begun attacking the TPP, which could become one of the hot-button issues in the presidential campaign. So it will be very difficult to pass the TPP agreement through Congress next year. The resignation of House Speaker John Boehner in late October will make it harder.

The TPP could be voted on expeditiously in Congress next year only if Congressional leaders and the Obama administration work very closely together to craft an implementing legislation for the trade agreement, which will take a period of time, Schott said.

"How the successor to Speaker Boehner will work with his counterpart in the Senate and with President Obama is uncertain. That would be a key variable I think in determining how smoothly the TPP moves toward ratification in Congress," he added.

Boehner announced last week he will step down as the House Speaker and leave Congress at the end of October, a move that shocked Capitol Hill and exposed the deep tensions within the Republican Party.

Boehner has helped Congress barely pass a bill in June that granted the trade promotion authority to Obama. That trade authority would allow the U.S. president to submit trade deals to Congress for an up-or-down vote without amendments, which is crucial for the swift congressional consideration of a TPP deal.

Failure to strike a TPP deal in Atlanta this week would certainly deliver a major blow to the Obama administration's trade agenda and raise questions about its capability and credibility, experts said.

The TPP, covering about 40 percent of global economy and believed to be the biggest trade agreement in the world in the past two decades, is central to the Obama administration's policy of advancing economic engagement in Asia and writing the rules for international trade and investment in the 21st century.

The TPP talks involve Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. Enditem