The Final Trans-Pacific Partnership Agreement

February 23, 2018

Copyright © 2018 McLarty Associates. All rights reserved.

KEY POINTS:

• TPP-11 countries released the final text of the agreement February 21, suspending 22 provisions related to now absent US participation.
• New Zealand Trade Minister Parker predicted the deal would come into force in the first or second quarter of 2019.
• President Trump’s suggested the US might return to the deal in remarks made at the World Economic Forum in Switzerland in January.  Even if Washington were to seek to return the US to the TPP-11 brokered deal, there is no guarantee that members would lift the suspension of 22 provisions.
• A group of 25 prominent US Senators sent a letter to President Trump urging return to the TPP in advance of Australian PM Turnbull’s visit to Washington next week.

The final version of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)  was released by New Zealand’s Ministry of Foreign Affairs and Trade.  New Zealand is the official repository country for CPTPP.  This text incorporates by reference the full agreement.  Signing of the CPTPP is slated to take place in Chile on March 8.

The CPTPP maintains the original commitments on market access from the TPP as agreed upon when the United States was still a party.  The 22 elements “suspended” following the US withdrawal mainly advanced interests that would have uniquely benefitted US industry. (The Asian Trade Centre did a thorough analysis of the suspended provisions in May 2017, accessible here.)  The newly released text includes two minor changes related to timing of commitments made by Brunei and Malaysia; there were no other changes.

The CPTPP will come into force after signature and 60 days after the 6th country (or 50% of the signatories) ratifies the agreement. 

It is unlikely the US will re-join the CPTPP in the foreseeable future.  US firms should use all means available to engage the US Congress and CPTPP member countries  to minimize comparative disadvantages arising from US absence from the agreement.  Our Singapore office and our home office in Washington stand ready to assist in that effort.