The controversial Trans Pacific Partnership (TPP) trade agreement currently awaiting congressional approval would have a positive impact on the American economy according to a new report from the US International Trade Commission (USITC).
Specifically, the independent federal agency said President Obama’s signature trade agreement would have the biggest impact on the food and agriculture sectors which would see a $10 billion increase output by 2032, year 15 of the agreement. Though its impact may be small, the report says the agreement will lift gross domestic product by $42.7 billion, 0.15 percent, by 2032 and increase employment through the addition of 128,000 jobs (0.07 percent).
The TPP agreement involves 12 countries along the Pacific Rim that account for up to 42 percent of all US agricultural exports. Trade ministers from each country gathered in New Zealand this past February to sign the agreement, though each country must now ratify the deal through its own political process. Supporters say the agreement—now more than five years in development—will bolster trade among member countries by eliminating tariffs and other barriers, while opponents fear the deal could be bad for jobs and award too much power to corporations.
USDA Secretary Tom Vilsack championed the report and called on Congress to pass the agreement arguing too much is at stake. “If we don't act, not only will we lose these opportunities, we will be ceding our leadership in the region to China, allowing them to define the rules that the Pacific Rim plays by,” Vilsack says
The North American Meat Institute (NAMI) also says it is pleased with the report’s findings. “The USITC’s report underscores the critical importance of TPP to the long-term economic stability and viability of the US meat and poultry industry,” says NAMI President and CEO Barry Carpenter. “By facilitating trade and investment, as well as reducing or eliminating tariffs and non-tariff barriers on US meat, poultry and animal products in the Asia-Pacific region, TPP will yield greater value for US companies and products, will support high-paying American jobs and will enhance the competitiveness of the US industry in foreign markets.”
While TPP will augment the competitiveness of U.S. meat and poultry exports across all countries represented in the agreement, NAMI says meat and poultry exports to high-tariff, high-demand markets, like Japan and Vietnam, will benefit significantly. For instance, under the agreement, Japan will reduce import tariffs on major cuts of fresh and frozen US beef to nine percent over 15 years after the entry-into-force date, down from the current level of 38.5 percent. Meanwhile, tariffs on U.S. pork exports to Japan, which are as high as 20 percent, will be phased out over a number of years.