The October 5, 2015 announcement that 12 Pacific Rim countries, including Canada, have signed the Trans-Pacific Partnership Agreement (TPP) is good news for British Columbia. Once/if ratified by all of the signatory countries, it will take time for BC businesses to feel the full effects of the deal: elimination of some tariffs will take 10 years or more. Eventually, the global economic potential of the “TPP region” and the new areas covered by the agreement, particularly services and investor and intellectual property protections, could reshape trade flows and boost economic development in what is already the most dynamic region in the world.
This edition of Policy Perspectives was guest authored by Karen Graham, Consultant to the Business Council on Public Policy and Research.
- Signing the TPP is good news for Canada and British Columbia: there will be long-term commercial benefits and few drawbacks for BC. It will, however, take time for BC businesses to feel the full effects of the deal: elimination of some tariffs will take 10 years or more.
- The TPP region represents nearly 40% of global GDP and one third of all international trade. The broader scope of the TPP helps position BC and Canada to benefit from liberalized tariff structures and also to gain from common rules and standards relating to intellectual property, foreign investment, anti-corruption measures, and labour and environmental standards.
- Several key goods-producing sectors in the province’s economy will have improved access to TPP countries: forest products; aluminum, iron and steel products; seafood; agricultural products; and chemicals and plastics. BC suppliers of exportable services, such as engineering, research and development, environmental services, and professional and management consulting services, also stand to benefit.
- The TPP may expand to encompass more countries in the coming years: several non-signatory countries are said to be considering joining, including South Korea, Indonesia, Taiwan, the Philippines and Colombia.
- Even within the context of the TPP, non-tariff barriers may persist that could disadvantage BC, such as foot-dragging on access to government procurement, technical barriers, and differing methods of resolving investor-state disputes.