Newspaper article Roll Call

The President Must Be Bold on Pacific Trade

Newspaper article Roll Call

The President Must Be Bold on Pacific Trade

Article excerpt

While President Barack Obama's handling of the economy has been criticized by his opponents, one area where he has shown leadership is on trade policy, specifically a free-trade area dubbed the Trans- Pacific Partnership.

Negotiations have been under way for a year and will resume this month in Virginia.

The aim is to lay down a trans-Pacific framework to expand trade and investment. This goal has been embraced by trade and business groups. With long-term growth prospects in Europe looking bleaker, the construction of trans-Pacific pathways to free trade and investment has immense commercial logic for exporters.

In 2011, U.S. exports rebounded from the economic slump in 2010. Worldwide, they increased 20 percent, but to Asian economies they increased 30 percent to 35 percent. And while China's economy is expected to slow, growth in Asia is still expected to lead the world for the next two decades at least.

Not all major Asian economies are participating in the negotiations. China is not, nor is Japan or South Korea, although both support it and are considering joining. Vietnam, Singapore, Malaysia and Brunei are negotiating, along with Australia and New Zealand, Canada, Mexico, Peru and Chile.

The plan is to create a trans-Pacific agreement that could be expanded to include all members of the Asia-Pacific Economic Cooperation group. China and Russia are members of APEC, along with the rest of the Association of Southeast Asian Nations economies and Japan, South Korea and Taiwan.

Unwisely, the Obama administration has bowed to pressure from organized labor and environmental groups to include measures that work against that goal. It has proposed that the agreement advance labor and environmental standards proposed by U.S. unions and green groups. That's unwise.

First, it would doom the TPP agreement. Developing countries would see it as a strategy to reduce their competitiveness and growth. They made it perfectly clear at the United Nations Conference on Sustainable Development in Rio de Janeiro in June that labor and environmental standards must fit their economic circumstances.

Meeting U. …

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