US exporters looking forward to Trans-Pacific Partnership
More details of the Trans-Pacific Partnership (TPP) have emerged, including the new market opportunities that are expected to develop for the US pig meat industry.
The United States is the second largest global exporter of pork after the EU and both countries are in competition on many of the 12 markets that are included in the TPP. Two thirds of US exports already go to the other members of the TPP, although some of this trade is already duty free, such as that coming under the North American FTA and exports to Australia and Singapore. For the EU, the proportion is just under 30% and so any competitive advantage to the United States could put some of this trade in jeopardy until the EU secures its own trade agreements. The EU is in negotiation with countries in the ASEAN region such as Singapore and Vietnam, both importers of pork from the EU, but progress is slow. EU trade negotiations with Japan started in November 2012.
Japan is the largest market for EU exporters, yet for the US under the TPP duties on more than 65% of tariff lines will be eliminated within 11 years and on nearly 80% within 16 years. In addition the gate price specific duty will be reduced by 90% in 11 years. Smaller markets where the United States should be able to increase its market penetration include Vietnam, where tariffs that are currently as high as 34% will be eliminated in 5-10 years. The same applies to New Zealand, for which tariffs that are currently up to 5% will be eliminated within 3 years.
An overview of the TPP agreement can be found by clicking here.