Transcript TPP

TRANSPACIFIC
FREE TRADE
AGREEMENT
FIRST TRADE AGREEMENT OF THE XXI CENTURY
BENEFITS FOR CHILE
World exports growth rate
The TPP will allow to retake dynamics of global shipments
Growth rate
(%)
6%
AVERAGE ANNUAL GROWTH
5,6%
AVERAGE ANNUAL GROWTH
8%
7,7%
2%
1,5%
AVERAGE ANNUAL GROWTH
AVERAGE ANNUAL GROWTH
AVERAGE ANNUAL GROWTH
AVERAGE ANNUAL GROWTH
World exports have experienced a strong deceleration during this decade versus the performance of the last two decades. In fact, after the economic crisis and slow global
recovery, exports expanded to a 1.5% annual average rate during the 2010-2015 period compared to an annual average growth of 5.6% during the 1991-1999 period and 7,7%
annual average between 2000 and 2009.
Source: Department of Studies, DIRECON-ProChile, based on UNCTAD figures (World Trade) and IMF (GIP).
TRADE INTERNATIONAL SYSTEM
• Multilateralism Crisis.
• Vacuum to Create Standards to
Face International Trade Challenges
Megaregional Free Trade Agreements
RCEP
REGIONAL COMPREHENSIVE
ECONOMIC PARTNERSHIP
TTIP
TPP
TRANSATLANTIC TRADE AND
INVESTMENT PARTNERSHIP
TRANSPACIFIC PARTNERSHIP
AGREEMENT
RCEP – TPP MEMBERS
TPP – TTIP MEMBERS
Source: Department of Studies, DIRECON-ProChile.
CHILE’S STATUS IN INTERNATIONAL TRADE
• Small Economy and Opened to
the World
• Need to have a Trade System
Based on Rules
• Need to Participate in the Design
of New Rules
• Asia Pacific as center of
Attention of Our Economy’s
Integration Efforts
TPP
(2015)
TRANSPACIFIC PARTNERSHIP AGREEMENT
Asia-Pacific Free Trade Zone
GDP PER CAPITA
27.5
(US$)
2015- FMI
BILLION DOLLARS
TPP’S GDP.
812
MILLION PEOPLE
BELONG TO THE TPP
CANADA
45,489
JAPAN
UNITED STATES
38,211
55,904
VIETNAM
6,020
MALAYSIA
26,141
SINGAPORE
84,901
MEXICO
18.335
38%
THE TPP REPRESENTS
OF THE WORLD’S ECONOMY.
BRUNEI
78,476
PERU
AUSTRALIA
12,077
47,318
NEW ZEALAND
35,966
CHILE
23,564
TWO OF THE THREE LARGEST
WORLD ECONOMIES ARE IN THE
TPP.
30% OF CHILE'S EXPORTS ARE
SHIPPED TO TPP COUNTRIES
11%
THE TPP REPRESENTS
OF THE WORLD’S POPULATION.
LEVERAGED AGREEMENT
Solution for sensitive issues
General negotiation considerations:
• Negotiations between 12 countries
• Political pragmatism key to reach an agreement
• Flexibility to service country-specific issues
Relevant sensitive areas:
• Intellectual Property
• Environment
• Transfers
ACCESS TO MARKETS
80%
5 of 11 PARTNERS
3,126
PRODUCTS EXCLUDED FROM FTA
WITH JAPAN RECEIVE PREFERENTIAL
PRODUCTS IMPROVE THEIR
TARIFFS
TARIFF TREATMENT
RULES OF ORIGIN
UNIQUE, FLEXIBLE BASED ON CHILE'S
EXPORTS
(THAT WERE EXCLUDED AND WITH
LIMITED ACCESS)
* BEEF* PORK*
* MILK PRODUCTS* SALMON* CITRUS
PRODUCTS *
*WOOD BOARDS* WINE*
* FRUIT JUICE*
* HONEY * TOMATO PASTE*
(CURRENT EXPORTS US$2.7
BILLION)
IMPROVED THEIR TARIFF ACCESS TERMS FOR OUR
PRODUCTS
* CANADA * JAPAN * MALAYSIA *
* MEXICO * VIETNAM
Between 65% & 100%
OF TARIFFS ARE EXEMPT
WHEN AGREEMENT STARTS
OPERATING
ALIGNMENT OF RULES AND PROCEDURES
• The TPP will have only one set of rules of origin, health, technical standards,
among other, for the 12 countries.
• One certificate of origin for the 12 countries.
• The TPP will align the 12 countries’ customs processes.
• Reduction of administrative costs
CUMULATION RULES OF ORIGIN (CRO)
Incorporation of regional production to global value chains
• More productive integration opportunities with TPP partners
• Area specialization where the region has comparative
advantages.
• We will share production of everything.
• The CRO will increase the use of Chilean consumables within
the partners’ production processes.
• Strengthening of the region's trade with TPP countries.
CUMULATION RULES OF ORIGIN (CRO)
Incorporation of regional production to global value chains
.
1
STEP
INTERMEDIATE PRODUCT OR
RAW MATERIAL IMPORTED
INTO CHILE FROM ANY OTHER
TPP COUNTRY
That complies with the
standard of origin and that
has a tariff benefit
2
STEP
MANUFACTURING IN CHILE
According to the
Rule de Origen that the final
product must meet in the
destination market.
3
STEP
CHILE EXPORTS
TO ANY TPP COUNTRY
Access under
Preferential Tariffs to
TPP countries
CUMULATION RULES OF ORIGIN (CRO)
Incorporation of regional production to global value chains.
Fresh pineapple
IMPORTED
FROM MEXICO
Aluminum alloy
IMPORTED
FROM AUSTRALIA
TPP IMPORTS
PINEAPPLE JUICE
Pineapple and aluminum
processed to manufacture
CANNED PINEAPPLE JUICE.
CANNED PINEAPPLE JUICE
Exported to other TPP countries as a 100%
Chilean product.
MANUFACTURING IN CHILE
TPP EXPORTS
TRADE FACILITATION
Incorporation of regional production to global value chains.
• Emphasis on the search of stronger links between Customs
Offices reinforcing cooperation, confidentiality, and citizen
rights
• Information database to detect customs frauds
• Incorporation of standards that encourage the generation
of standard corrections in:
• Customs procedures
• Customs cooperation
• Information delivery measures that allow a fast and
efficient access to the parties’ Customs
• More certainty and predictability through Early Resolutions
Benefits – Other Disciplines
• Health and phytosanitary standards
• Chapter subject to the Treaty’s conflict solution mechanism.
• Guarantee agreements already contained in the Agreement on the Application of the WTO’s Health and
Phytosanitary Measure
• Creation of a MSF Committee
• Higher access certainty for our farm, fish, and timber exports
• Covers equivalency, transparency, import controls, certifications, and audits
• Trade technical obstacles
• Chapter subject to the Treaty’s conflict solution mechanism.
• Deepens and develops the WTO’s Agreement provisions and captures the work of APEC’s Sub-Committee on
Standards and Conformance
• Reinforces transparency among the Parties with the obligation of publishing and reporting regulation
proposals and their final text
• Promotes regulatory cooperation among the Parties, always seeking trade facilitation
• Includes Sector Appendixes (Wines and Spirits and Organic beverages, among other)
• Establishes a WTO Committee
Benefits – Other Areas
• Services: Provides important guarantees to service exporters. We can highlight the inclusion of an
appendix on professional services as an additional gain for Chile (bilateral).
• Investments: The TPP guarantees a proper level of protection for investors safeguarding the right of
States to regulate with legitimate public interest purposes.
• Temporary Entry of Businesspeople: Guarantees transparent, expeditious, and not excessively severe
migration procedures.
• E-Commerce: Obligation to not apply customs tariffs on content electronically transmitted.
Benefits – Other Disciplines
• Environment
• The right of countries to establish their own levels of environmental protection and policies and
environmental development priorities is recognized.
• Full observance of the Agreement’s conflict solution mechanism.
• Commitment to comply with their law and not curtail protection standards to attract businesses and
investments.
• Labor Issues
• ILO Declaration of 1998 on Fundamental Principles and Rights at Work included
• Protectionist work standards not applied
• Measures against imports of forced labor products
• Participation of stakeholders
• Conflict Solution Mechanism for all issues
Benefits – Other Disciplines
• Public Contracts
• Structure similar to WTO’s ACP establishing standards to open public contract markets in a fair and
transparent manner
• Application environment: covers all asset, service, and building contracts, including “public work concession
contracts”
• Chile will expand said disciplines to three new markets: Peru, Vietnam, and Malaysia
• The Chapter considers general exclusions to protect lives, health, safety, and intellectual property.
• Competition Policy
• Commitments to prevent anti-competition practices
• Adherence to basic and cooperation principles (provisions not subject to the agreement’s conflict solution
chapter).
• Obligation to maintain (or adopt if not present) competition laws and authorities in charge of prosecuting
anti-competition practices
• “process equality” and “rights of private action”
• Recognizes the relevance of consumer protection during the creation of efficient and competitive markets
New Issues
• State-Owned Companies
• Small and Medium-Sized Companies
• Gender
• Regulatory Coherence
• Development
• Competitiveness
• Transparency and Anti-Corruption
NEXT STEPS
• Processing in National Congress
• Intense agenda to disseminate contents
See TPP’s contents at:
https://www.direcon.gob.cl/tpp/
TRANSPACIFIC
FREE TRADE
AGREEMENT
FIRST TRADE AGREEMENT OF THE XXI CENTURY
BENEFITS FOR CHILE