Report claims TPP gains have been overstated
Wednesday 5 Feb 2014 7:33 a.m.
Trans-Pacific Partnership Agreement talks resume later this month but a new report into the proposed free trade deal says the benefits have been vastly overstated.
New Zealand is one of 12 countries currently negotiating the agreement.
Supporters of the TPP say it'll provide a huge benefit to exporters by unlocking markets around the region - but that argument is being criticised.
“They've been under pressure to produce big numbers, and they've produced big numbers but in the process they've lost the plot,” says Victoria University senior associate Geoff Bertram.
New Zealand is one of 12 countries negotiating the deal, which the Government says could earn the country improved access to markets such as America and Japan, bringing in an extra $5 billion dollars by 2025 and lifting exports by 6.8 percent.
A report by The Sustainability Council and Dr Bertram says modelling of trade gains is flawed and any benefits could be just a quarter of those claimed.
“From what I can see on the public record I'm not convinced, [it is] not a good idea – in fact it could be a bad idea,” he says.
The report found potential costs were ignored - such as with a US proposal giving multinationals the power to sue a TPP country if new laws hurt their profits.
“I would see quite a strong possibility that drug companies will be able to force Pharmac to use more of their product and less generics and that means higher drug costs,” says Dr Bertram.
Prime Minister John Key says the deal hasn't been done so it shouldn't be judged yet.
“I'm leading a government which is part of TPP negotiations and even we don't know what a final deal looks like, so they are making lots of assumptions that they can't possibly justify or back up,” he says.
The Government has kept its negotiations secret so far, but the Greens say participating countries have swapped TPP details.
“The Government's have already seen them and released them to each other, it's only the citizens who do not know what's being negotiated with the TPP,” says Green Party co-leader Russel Norman.
Both Dr Bertram and Dr Norman want the Government to make negotiations public, but Mr Key says any TPP deal will go before Parliament anyway before the paperwork is signed.