By Todd Neeley
DTN Staff Reporter
LINCOLN, Neb. (DTN) -- Congressional approval of the Trans-Pacific Partnership agreement likely would set off a subsequent round of negotiations as other nations already have shown interest in participating, the United States' chief agriculture trade negotiator told an audience at the University of Nebraska-Lincoln Tuesday.
USDA Chief Trade Negotiator Darci Vetter said since 12 nations agreed on TPP, eight other countries including Korea, the Philippines and Indonesia have shown interest. Any next round, however, could happen only after Congress approves the current TPP.
"Once they saw what was possible, they wanted to be part of it," she said.
"... There is a temptation in an election year to say we can't do anything that's hard. Part of the battle is to let the agreement speak for itself. It's an uphill battle with or without TPP, but the world is moving on without it. Almost all of the TPP partners are already negotiating with the European Union. We could miss an opportunity to set rules with how we do business in the region."
Vetter stopped short of predicting a free-trade agreement could be reached with China in the near future. However, although China was opposed to the TPP "their attitude has changed," she said, and China now is re-evaluating TPP.
Vetter is touring the United States touting the benefits of the agreement. She stopped in Lincoln, Nebraska, Tuesday to join in a trade discussion with former trade negotiator and former U.S. Agriculture Secretary Clayton Yeutter in front of a UNL audience as part of the Heuermann lecture series.
There are other agreements similar to TPP, Vetter said, but they lack rules. "We're at a tariff disadvantage already," she said. "We can't afford to wait."
The TPP nations currently on board include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.
"This isn't a political issue," Vetter said. "The next challenge is to formally sign the agreement."
Vetter pointed to the value to farmers of having Japan and Vietnam on board with TPP. Japan is a "high-value customer," she said, but currently has "very high tariffs and complicated processes to get our products in.
"Japan refuses to put some products on the table" outside of the TPP agreement, Vetter said. "We will have new access to all products (with TPP)" including rice.
Because Vietnam's economy is rapidly growing, the nutritional needs of an expanding middle class open market opportunities for farmers.
"They are changing the way they eat," Vetter said. "The country doesn't have land, so we also expect to sell more products. We think TPP creates an important platform -- start with 12 countries to meet high standards then invite others."
Trade agreements such as the North American Free Trade Agreement, or NAFTA, Vetter said, have allowed the United States to raise trade standards in other nations.
"If we have a trade agreement, it will be rules-based trade," she said.
Yeutter said the success of NAFTA, for example, shows why it's important for the United States to be involved in trade agreements.
"The advantage to TPP is there is an advantage for those on the inside versus those on the outside," he said. "NAFTA, for example, has made countries more competitive as North American. We have huge advantages because we're on the inside of NAFTA."
EU TRADE BARRIERS
Sanitary and phytosanitary issues continue to "be more difficult" barriers to overcome than issues of tariffs, Vetter said, especially when it comes to trade negotiations with the European Union.
"On the biotech front, I don't think governments are concerned about those products (genetically modified organisms, or GMOs)," she said. "Governments would say the public isn't there yet. We hear the safety argument a lot. But even in the U.S. we don't do a good job talking about safety."
Vetter said negotiations are ongoing with the European Union on the Transatlantic Trade and Investment Partnership, or TTIP. Because of financial troubles in countries such as Italy and Greece, she said negotiations with the EU are "less farther along" especially on agriculture issues.
"If there's any issue that is difficult, it is agriculture," Vetter said. "I hope to use the next year to move negotiations further. We have to get at ag tariffs -- they are much higher in the European Union. We hope to deal with biotech. We have to let science be the guide. Frankly, it is very difficult with the EU. We will have to find a way to get acceptance of the ways we produce some of our products."
TRADE WITH CUBA
Vetter and Yeutter pointed to the need for Congress to lift the embargo on Cuba, in order to lay the groundwork for expanding agriculture trade between the two nations.
Vetter said the administration has "taken steps" to make it easier to trade in agriculture products in Cuba. "But before we can deepen, we have to end the embargo," she said. "They need help on the technology side. It is a huge opportunity for two-way trade."
Yeutter said he believes any progress on agriculture trade with Cuba likely will push into 2017 because of presidential election politics.
"The embargo will be lifted," he said. "We need to get rid of that thing. Once we do, that economy will explode. Not just U.S. investment. Once it happens, it will happen very rapidly."
Todd Neeley can be reached at todd.neeley@dtn.com
Follow him on Twitter @ToddNeeleyDTN
(SK)
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