01 August 2015
by Peter Martin
Trans-Pacific Partnership deal in doubt
The US has withdrawn an offer it had made to Australia in 2014 on dairy access.
The giant Trans-Pacific Partnership trade talks are in danger of breaking up without agreement after the United States gave little ground on market access, withdrawing an offer it had previously made to Australia on dairy products.
Talks went late into the night on Friday and resumed early on Saturday as the closing press conference was postponed from 9.30 am Australian eastern time until midday with talk that it might be postponed again.
If there is no agreement, the Hawaii talks might be extended, or more likely postponed until late August.
The tight deadline is needed to get in ahead of the US presidential election season, in which it is believed nothing agreed between the 12 nations will be approved by the Congress. Canada is also due to hold an election in October.
On Friday 20 members of Congress signed a letter demanding that the US insist on the right to force changes to other countries' implementing legislation after the deal was signed.
It did this with the Australia-US Free Trade Agreement and with its agreements with Peru and South Korea. Insisting on the right to change legislation in 11 other countries would add a further barrier to a deal. The agreement would take in Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States.
Ahead of what was likely to be a marathon night of negotiations trade minister Andrew Robb described the atmosphere as "intense".
"But we are making progress," he told the ABC. "They are baby steps, unfortunately, and taking quite a while, but I do feel we are getting our message across on a couple of key issues, and the ones that are show-stoppers for us, the investor state dispute settlement mechanism, the sugar issue and-of-course the biologics, we are making good progress on all of them, but we haven't got to where we need to be yet."
Australia is insisting on limiting the period of data exclusivity for so-called biologic drugs to 5 years rather than the 12 demanded by the US.
Data exclusivity is the period of time in which generic manufacturers are prevented from using data gathered in tests of patented medicines.
The newsletter Inside US Trade reported early on Saturday that a compromise under discussion would involve setting a base period of 5 years with a 3-year extension in certain circumstances.
It quoted an Australian source as saying this type of compromise would not require a change in Australian law.
Public health advocates are concerned about a US proposal to include a broad definition of biologic drugs that would basically capture any pharmaceutical product that is a protein. The definition would lock up data on a wide range of biologic medicines and all vaccines. They want the definition to be decided by domestic law.
Early Friday the US withdrew a 2014 offer to Australia on access for butter, milk powder and cheese as part of what appeared to be a hardening of its position ahead of dairy negotiations with Canada.
Australia is holding firm on its demand that Medicare and the Pharmaceutical Benefits Scheme be excluded from investor-state dispute settlement procedures that would allow overseas-owned companies to sue Australian governments in offshore tribunals.
Mr Robb said other countries had "deal stoppers" that may affect their decision about whether to sign up to this agreement.
"On balance, I do feel that we are sort of 80, 85 per cent prospect, but that still leaves 15 per cent probability that this won't happen," he said.