Much yet to do to seal a TPP deal -- like address currency manipulation

Posted by mmcmullan on 10/23/2013

Much has been made of President Obama’s absence from a string of diplomatic summits in Asia earlier this month. On the wings of those meetings, the president was expected to seal up the Trans-Pacific Partnership (TPP), a major trade deal  ... but the government shutdown and the accompanying fiscal cliff standoff, forced by a Congress full of Yosemite Sams, caused Obama to hang back in DC until a resolution could be found.

He caught a lot of flack for doing so. Trade negotiations, after all, need to be face-to-face, even when the negotiations involve something as weighty as a third of global trade. And stand-in John Kerry simply doesn't look very good in a brightly colored shirt. It's not his fault. He can't help it.

Despite that fashion faux pas, negotiations continue. The Obama administration, in fact, is presently parlaying with Japanese officials (Japan is a TPP party) ahead of the next round of comprehensive negotiations in December.

Still, there are plenty of doubters who don’t think the administration can get this deal through. Along with the many complaints domestic industries have with the TPP, the White House will also have to find a way to placate the majorities of both chambers of Congress that want currency manipulation addressed before they give any trade deal their blessing:

Obama’s final push for a Pacific trade deal also is complicated by demands in Congress that it include rules against currency manipulation, which lawmakers say would prevent countries from negating the impact of tariff concessions by devaluing their currency. That’s a big ask, which the United States very likely would have to pay for with concessions in other areas — and it carries a big risk, opening the U.S. to possible challenges about its own currency movements.

If Obama completely ignores the issue, however, he risks losing the support of many of the 60 senators and 230 House members who signed letters calling for enforceable rules against currency manipulation in the TPP deal.

Read the whole story from Politico’s Doug Palmer here.

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