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Kerry defends free trade deals

BBC News BBC News 12/04/2016 By James Cook
Protester in Chile: Protests about TPP have been held in Chile and elsewhere © Reuters Protests about TPP have been held in Chile and elsewhere

The US Secretary of State John Kerry has delivered a staunch defence of free trade in a speech in California.

John Kerry speaks in LA: Kerry's speech was at odds with Hillary Clinton © AP Kerry's speech was at odds with Hillary Clinton

Mr Kerry said the economic and strategic case for the Trans Pacific Partnership (TPP) was "overwhelming".

Car production in India: An alternative trade bloc including China and India is forming © Reuters An alternative trade bloc including China and India is forming

The TPP is a sweeping multinational trade deal, designed to deepen economic ties between 12 countries in the Americas, Asia and Australasia.

Critics say such deals kill jobs © Reuters Critics say such deals kill jobs

Opponents of TPP, including Mr Kerry's predecessor Hillary Clinton, have warned it will hurt American workers.

Speaking in Los Angeles at an event organised by the Pacific Council on International Policy, Mr Kerry insisted the TPP would mean lower taxes, easier access to growing markets, and rising exports.

He also defended a controversial proposed trade deal with the European Union - the Transatlantic Trade and Investment Partnership (TTIP) - arguing that, "contrary to some of the mythology", it would raise standards and improve economic prospects on both sides of the Atlantic.

Protectionism has been a watchword for both parties on the US presidential campaign trail as candidates compete to attract votes of Americans worried about jobs going abroad.

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But Mr Kerry criticised "commentators and politicians on both sides of the political spectrum", accusing them of fanning flames and tapping into fear. Some lacked understanding of the issues, he said, while others were purposefully exploiting fear and anger.

The TPP deal, he insisted, would be "good news for factories, farmers, ranchers, and service providers" and would lift incomes for Americans by more than $130bn (£91bn) by 2030 while raising the "standards that govern global trade in a way so that it levels the playing field for American workers and businesses".

The pact which could cover almost 40% of the world's economy was signed in New Zealand in February and must be ratified or rejected by its members within two years.

It involves 12 countries - the US, Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile and Peru.

The TPP aims to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth.

Member countries are also hoping to build a closer relationship on economic policies and regulation.

Supporters say the agreement could create a new single market akin to the European Union.

"When you add it all up, the economic case for TPP is actually not even a close call in my judgment, it's overwhelming," said Mr Kerry.

The deal, he said, would eventually "eliminate over 18,000 foreign taxes on Made in America products" as well as reducing red tape and forcing other nations to adhere to American labour, climate and intellectual property standards.

Opponents, particularly in the US, say it will destroy jobs.

As secretary of state, Hillary Clinton began the negotiations which led to the deal but as a presidential candidate she has come out against the final version, saying that an agreement which she had hoped would be a "gold standard" for trade "didn't meet my standards" and would not help to raise wages for middle-class Americans.

Her rival for the Democratic nomination for the White House, Bernie Sanders, is an even more outspoken opponent of the "disastrous" deal which he argues is designed by and for big corporations at the expense of ordinary Americans.

The TPP, says Mr Sanders, "follows failed trade deals with Mexico and China that have cost millions of jobs and closed tens of thousands of factories across the US".

The leading Republican candidate for president Donald Trump has also criticised TPP as "a terrible deal" negotiated by an "incompetent" administration.

His main rival for the nomination, Ted Cruz, insists he believes in free trade but says he too would vote against the TPP.

John Kasich, the governor of Ohio who is also vying for the Republican nomination, has defended trade deals.

In his speech, Mr Kerry warned that opposing the deal would weaken America's influence around the world and harm the US economy.

"Protectionism is not the remedy to economic pain, and it's not even a harmless placebo, it's the way to stop our economy in this new world we're living in dead in its tracks," he said.

Other nations, he argued, would be delighted to fill the gap. China, for example, was "working to finish its own version of TPP" with 16 countries from India to Japan, an agreement which would not "raise labour or climate standards, or protect intellectual property, or promote fair play or, needless to say, insist on a free and open internet".

The choice, said Mr Kerry, was for the US "to lead and help define the rules of global trade or to witness the fastest-growing markets race to the bottom, while standards antithetical to our interests and values become business as usual for billions of people across our planet".

Still, the secretary of state acknowledged that many Americans felt "a sense of anxiety" about trade deals.

Some of that mistrust, he said, "comes from politicians who play to fears. It comes also from legitimate anger about the economic status of millions of our fellow citizens who have not gained through trade".

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