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Intensive negotiations began on Tuesday in Hawaii as trade ministers met from 12 Pacific Rim countries to discuss the Trans-Pacific Partnership. The Trans-Pacific Partnership, or TPP, has been called one of the biggest trade deals of all time. Yet, the effects on Canada and its citizens remain to be seen.
What Is TPP?
Before we discuss how the deal will influence Canadian companies and citizens, an understanding of the deal is needed. The TPP is a deal purposes by Canada, Mexico, the United States, Japan, New Zealand, Australia, Vietnam, Peru, Malaysia, Singapore, Chile, and Brunei. On the whole, the international trade agreement strives to eliminate barriers to trade, like tariffs, among these 12 countries. In doing so, the TPP hopes to facilitate development of production and supply chain efficiencies within the member countries.
Full disclosure of the international trade deal has not been made public, and there is some discourse that the deal could ultimately hurt countries like Canada. Yet, the deal is supposed to be all encompassing. From labor rights to food products to automobiles – the TPP is said to have all aspects of international trade covered among the countries.
How Will It Affect Canada?
The deal will have a large impact on Canadian consumers and companies alike. Many, like Canada’s Minister of International Trade, Ed Fast, believe the deal will be incredibly positive for Canada. The TPP gives Canadians access to one of the most important trade regions in the modern world, the Asia-Pacific region. The deal should give Canadian exporters easy access to a huge group of countries, creating a net positive for Canada.
As exports mean growth and more jobs, Canada can only benefit from the deal. And the exporting companies are not the only benefactors. Canadian consumers should see better prices on a number of goods. The TPP opens up trade markets and will create more inter-industry competitions. As consumers should see a greater selection of products to choose from, most analysts believe prices will fall.
Good or Bad?
The TPP is yet to be finalized. So it’s hard to speculate whether or not the deal will be a positive or a negative for Canada over the long haul. As the deal reaches completion, many culturally sensitive and political matters have come into play. Trade ministers from all countries are working diligently to combat any last minute political issues that come up.
The fact of the matter is that Canada may not be able to afford to not be part of the deal, whether it is good or bad for the country, companies, and consumers. Still, the talk about TPP is not over in Canada. As the federal elections are looming, every party will be forced to take a stand on the TPP. And this may ultimately determine if Canada and the Trans-Pacific Partnership become partners down the road.