New Zealand to ratify CPTPP (TPP) in December or early January 2019.

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According to Radio New Zealand, the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP) will be in force around December of 2018 after New Zealand plans to be the first of six countries to ratify the agreeement.

As of today, Japan, Mexico and Singapore have ratified the agreement with Australia, Chile and now New Zealand soon to ratify.

In addition to the 11 countries, Colombia, Thailand and South Korea along with Britain also expressed interest in joining the CPTPP.

Singapore ratifies trans-pacific trade deal.

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Channel News Asia reported last Thursday that Singapore ratified the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Originally known as the Trans-Pacific Partnership, the name was changed after the Trump Administration withdrew US support for the TPP after some members would not agree to US terms regarding pharmaceuticals and intellectual property protections.

Since the new CPTPP was created, only 3 nations have ratified the agreement (with Mexico and Japan as the only two countries to ratify the agreement. However, last Thursday, Singapore became the third after signing the CPTPP.

Terms of the CPTPP agreement concluded in January 23rd of this year and signed on March 8th. There are still 8 more countries that need to sign in order to ratify the treaty. Once all countries sign, the CPTPP will be in force 60 days later.

Japan passes law to ratify Trans-Pacific Partnership trade deal.

As reported by the Kyodo News Рthe Japanese government enacted a law to ratify the TPP free trade deal. As you are aware, Japan and 10 other nations (Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam) continued negotiations with the free trade deal after the United States withdrew. The TPP deal requires at least 6 member countries to ratify the pact before it takes effect.

More TPP updates as they become available. If you have any trade or customs questions, please feel free to contact David Hsu at 832-896-6288 or by email at dhsu@givensjohnston.com.

Harley Davidson claims new factory in Thailand a result of US withdrawal from the TPP.

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According to a Bloomberg article published April 24, 2018, Harley Davidson motorcycle maker opted in on building a factory in Thailand after the Trump administration withdrew US participation in the Trans-Pacific Partnership (TPP). In the first publicized impact of the US withdrawal from TPP, Harley Davidson CEO Matt Levatich indicated the factory in Thailand was “necessary to access a very important market”.

Additionally, the impact of leaving the TPP was also felt locally for the 260 US jobs lost due to the closure of the Missouri plant amind slumping sales in the US.

As a counterpoint to the article – the article does specify that Harley Davidson has seen sales decreasing in 13 of the last 14 quarters. If accurate, the sales declines started long before the TPP was even discussed and long before the US withdrew from participating in the TPP.

It is further important to note that correlation does not mean causality as Harley Davidson sales in the Asia Pacific region were 32,258 in 2015; 32,889 in 2016 and decreased to 30,348 in 2017. Sales decline of Harley Davidson in Asia occurred well before the US withdrew from the TPP.

I believe the US withdraw from participation in the TPP was used by the CEO to justify two unpopular moves – the building of a factory in Thailand and a closure of the Missouri plant.

Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) signed on March 8th, 2018.

Last Thursday, the 11 countries participating in the as-formerly-known-as Trans-Pacific Partnership signed the Asia Pacific trade pact without the United States.

The revised agreement known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) aims to reduce tariffs between member countries. One main item left out of the CPTPP (but included in negotiations of the TPP) are the lack of intellectual property protection of pharmaceuticals favored by the United States.

According to the Peterson Institute for International Economics, the CPTPP will generate $147 billion in income, versus an estimated $492 billion in global income benefits under the original TPP.

 

Feel free to contact David Hsu for any questions related to CPTPP or how this trade pact may impact your business, 832.896.6288 or dhsu@givensjohnston.com.

Current Trans-Pacific Partnership (TPP) Developments since the US Withdrawal.

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The 2017 APEC Summit was held in Da Nang this year from November 6th – 11th.

At this meeting, 11 countries in the Pacific Rim decided to continue plans for the Trans-Pacific Partnership (TPP) after the US withdrawal.

The former agreement known as TPP was renamed the “Comprehensive and Progressive Agreement for Trans-Pacific Partnership” or (CPTPP). The primary reason for the change was the old TPP agreement required ratification within two years by economies that consitute 85% of the total GDP of the 12 members. The US withdrawal from TPP leaves Japan unable to constitute 85% of the total GDP (the US constituted 60% of the former TPP bloc’s combined GDP). The 11 remaining countries – Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam – agreed to revise the 85% total GDP ratification clause.

Since the US withdrawal, there have been four rounds of negotiations and the details of the CPTPP are yet to be released. However, based on the Government of Canada Ministerial Statement on CPTPP, the CPTPP appears to replicate the original TPP.

The 11 current members still are committed to key trade industries as textiles, removing barriers to trade, addressing competition, state-owned enterprises and labor and dispute settlements.

The main difference with the new CPTPP agreement versus the old TPP are the removal of approximately 20 provisions requested by the US. Some provisions requested by the US included a copyright protection rule of 70 years. Under the new CPTPP, the copyright protection has been reduced to 50 years. Other differences concern competition rules for state-owned enterprises and change in time required for trade unions to be subject to dispute settlement measures.

As of today, the revised CPTPP agreement has been agreed to in principle at the summit but remains to be ratified.