U.S. Treasury Secretary Jacob J. Lew sought progress on negotiations in the Trans-Pacific Partnership in his trip to Asia this week as a year-end deadline for the trade pact looms.
Some issues are still being “worked through” in the goods component of the trade deal, Lew told reporters in Singapore after meeting with the city-state’s finance minister Tharman Shanmugaratnam today. In Tokyo yesterday, Economy Minister Akira Amari advised Lew to understand that Japanese producers need protection in agricultural areas.
Japan’s defense of its farming industry, Malaysia’s proposal to keep tobacco control measures out of the deal, and the impact of currency manipulation on markets are among issues impeding progress on the accord the U.S. calls the cornerstone of its economic policy in the region. At stake for member nations amid an uneven global recovery is the prospect of faster growth as their goods and services find new and bigger markets.
“I’ve made the case very strongly that we do need to try and complete it this year not because it’s important to the U.S., because it’s important to all of the parties in the agreement to reach a conclusion,” Lew said in an interview with CNBC Television today. “There will be tough decisions to be made in the final weeks and we’ve known all along that the hardest decisions would come at the end.”
A TPP accord, which involves countries such as Australia, Canada, New Zealand and Mexico, would link an area with about $28 trillion in annual economic output. Four of the five countries on Lew’s tour of Asia this week are TPP nations. After Japan and Singapore, his stops are Malaysia, Vietnam and China.
The TPP “will ultimately boost trade, boost investment and boost job creation in all our countries,” Shanmugaratnam said. “We intend to raise standards of investor protection for businesses and strengthen the financial services sector, and of course the eventual TPP package will have to provide an overall balance of benefits for all participants.”
Amari told reporters yesterday he explained to Lew political difficulties around some TPP areas for Japan. Lew said that Japan is U.S.’s ally on financial services matters in TPP.
“Japan stands to gain quite a lot from TPP being successful,” Lew told CNBC today.