It’s been a long time in the making. Negotiations for the long-awaited Trans- Pacific Partnership (TPP) trade agreement began more than seven years ago. And earlier this month, Australia joined 10 other nations to finally sign off on the deal.
The deal was struck following the shock withdrawal of the US late last year.
When US President Donald Trump pulled the pin, many doubted it effectiveness without its most influential country involved.
Japanese Prime Minister Shinzo Abe reportedly said a TPP without the US would be “meaningless.”
After all, the US accounted for 60 percent of the combined GDP of the group.
The big question now is whether the 11 remaining countries can make it work.
The main aim of the TPP (now known as Comprehensive and Progressive Agreement for Trans-Pacific Partnership or TPP-11) is to further open up the markets of its member countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
Under the new deal trade tariffs will be slashed considerably. TPP-11 will eliminate 98% of trade barriers, opening up access to a combined marketplace worth close to $13.7 trillion.
The deal will reduce or abolish tariffs on Australian beef, cheese, cotton, wool, seafood, horticulture and wine.
There’ll be greater access to Japanese, Canadian and Mexican markets for Australian sugar and dairy exporters.
Even without the US, it’s a hugely significant deal and other nations have the chance to enter in the future. Indonesia and even the United Kingdom have shown some interest.
And Trade Minister Steven Ciobo says the door is still open for the US to re-join the group.
But before coming into effect, TPP-11 has one final hurdle to jump – it must be ratified by the member countries.
In Australia, that will require support from the Labor Opposition or Green and Independent senators.
While Labor supports the deal in principal, they have expressed concern about some of its provisions.
Along with the Greens and Independent Senator Nick Xenophon the Opposition is promising to closely scrutinise the contents of the bill when introduced into the Parliament.
Australian exporters can do without any political point scoring with such high stakes involved.
We hope common sense will prevail.