March deadline for Trans-Pacific Partnership trade deal, Malcolm Turnbull says

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Australian Financial Review | 18 January 2018

March deadline for Trans-Pacific Partnership trade deal, Malcolm Turnbull says

by Andrew Tillett

Prime Minister Malcolm Turnbull is prepared to sign the Trans-Pacific Partnership free trade deal with or without Canada and Mexico, setting a March deadline and declaring the pact is needed urgently to defy creeping global protectionism.

Visiting Tokyo for talks with Japanese counterpart Shinzo Abe, Mr Turnbull also left the door open to the US rejoining the TPP in the future despite President Donald Trump’s withdrawal 12 months ago as part of his pledge to put "America first".

"The important thing is to get the train moving... then you can add a few more carriages along the way," Mr Turnbull told The Australian Financial Review.

It is also understood there are aspirations for South Korea and Indonesia to become TPP members in the future, with Mr Turnbull saying its logic was so "compelling" other countries would want to be part of it.

Mr Turnbull and Mr Abe have championed keeping the TPP alive despite the US withdrawal, and the remaining 11 countries were set to seal the deal in November on the sidelines of the Asia Pacific Economic Co-operation until Canadian Prime Minister Justin Trudeau was a shock last minute withdrawal.

Mexico backed Mr Trudeau for the delay, with both countries mindful of the tough renegotiations they face with the US over the North American Free Trade agreement.

But amid rising optimism Canada would come back on board, Mr Turnbull said he wanted the TPP finalised at a meeting of trade ministers in Chile in March.

"Of course, as we all know, trade talks invariably take a long time," he said in a press conference.

"There are hills and hollows as you go along to get to the goal but Prime Minister Abe and I are very committed to it. We’re using all of our persuasive skills, such as they are, to ensure we can get it agreed."

Addressing a business lunch, Mr Turnbull said the TPP’s importance went beyond simply gaining market access and was a way to combat isolationist sentiment.

"The TPP is a down payment on the sustainability of free and open markets at a time when they are under pressure from the combined forces of populism, protectionism and geo-economics," he said.

"The TPP promises greater transparency and a stronger rule of law in a world which is too often short of both."

While not naming Canada, Mr Turnbull said most of the 11 members grasped the significance and opportunities offered by the TPP and it was time to formalise the agreement.

"They see this as the most important contribution to the rules-based system that is on offer in the world economy right now," he said.

"Our strong preference is for all 11 countries to join the first wave but our focus is on bringing the new TPP agreement into force as soon as possible with those who are ready to move."

Mr Trudeau has sought concessions for Canada’s automotive industry as well cultural exemptions. It is understood these issues are yet to be resolved and while the Canadians remain hopeful, it is uncertain whether they will be worked through in time for the March meeting.

But Mr Trudeau is facing domestic pressure to sign up to the TPP, with the Business Council of Canada and chief executives of 18 major companies telling him last month trade diversification was more important than ever, an implicit reference to the NAFTA talks.

Cattle producers this week urged Mr Trudeau to sign, warning that Mexico and New Zealand would get the jump on beef exports to Japan if Canada remained out of the TPP.

Mr Trump, a fierce NAFTA critic, used an interview with Reuters on Wednesday to declare that terminating the 24-year-old pact might produce the "best deal".