FIVE years of trade negotiations, 29 chapters of dense rules and hundreds of tariff lines culminate, in one corner of Asia, in whirring spools of white fabric. Negotiators are still wrangling over the text that aims to establish a new Pacific trade zone, tying together 12 countries from America to Vietnam. But Penfabric, a textile company in Penang, north-western Malaysia, is not waiting around. In one of its mills, bright yellow flags distinguish rolls of high-end fabric from cheaper cloth. Lately, these flags have started to multiply. “We need to be in tune with what America wants,” says H. S. Teh, Penfabric’s managing director.
The zone, dubbed the Trans-Pacific Partnership (TPP), is the most important free-trade agreement in years. If completed, it will be the largest regional trade deal ever, with its members accounting for nearly 40% of the world economy. The countries leading the negotiations want to set a new standard for what trade agreements cover. They are taking on the morass of regulations, such as local-content rules determining how much of a product must be made from local inputs, that have replaced tariffs as the main obstacle to the...
from The Economist: Finance and economics http://ift.tt/1gQbiUf
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