Businesses across the US are being courted for their support of the Trans-Pacific Partnership (TPP), which the government is seeking to ratify via Congress in the coming months.
The broad-ranging trade deal, which aims to lower trade barriers between 12 countries and enable greater economic cooperation, was finally ratified in October 2015 following several years of high-stakes negotiations between ministers from each of the participating countries.
However, before its effects can be implemented, it must first be ratified at a national level by the governments of each of the 12 involved countries. As such, it could be some time before companies in the US and elsewhere begin to experience any changes.
As such, the US government is allying with trade bodies to champion the smooth passage of the TPP through Congress, a move that it believes will ensure that the benefits of the deal are brought into effect at the earliest possible opportunity.
How will US companies benefit from the TPP?
An expansion of the Trans-Pacific Strategic Economic Partnership Agreement, the TPP deal was originally mooted in 2008 and will encourage stronger trade links between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.
It aims to eliminate or reduce tariffs and non-tax barriers across almost all trade in goods and services, reform regulations affecting productivity and supply chains, promote innovation and create more opportunities for smaller firms, while also standardising labour rights and enforceable environmental commitments.
From a US-centric perspective, it is estimated that 18,000 taxes that other countries place on American-made exports will be scrapped, while insulating the nation against the emergence of alternative trade models that do not work in the country's best interests.
Specifically, the US government sees benefits in the implementation of a broad-ranging global trade framework over which it has a great degree of influence and control, allowing it to reclaim a certain amount of clout from the likes of China, which is not a TPP member.
The design of the TPP has already found favour among many trade organisations representing the US business community, including the National Association of Manufacturers, the Business Roundtable, the US Chamber of Commerce, the National Small Business Association and the American Farm Bureau Federation.
Business Roundtable chairman Tom Linebarger said the deal will "expand US trade opportunities and setting strong new rules for international commerce", while US Chamber of Commerce president and chief executive officer Tom Donahue said the tariff reductions will help to "open new markets for American agricultural exports and strengthen trade in services".
Other endorsements have come from a diverse range of sectors, including tech industry bodies such as the Technology Industry Council and the Tech CEO Council, e-commerce groups like FedEx and DHL, food and beverage bodies like the Wine Institute and the Distilled Spirits Council, and agricultural sector representatives including the Northwest Horticultural Council and the National Cattlemen's Beef Association.
The US government will continue to debate the pros and cons of implementing the terms of the TPP at a national level, and will continue to seek the support of relevant stakeholders in order to ensure the measures are passed into law with a minimal delay.
US trade representative Michael Froman said: "Exporters in every sector of the US economy increasingly realise that the cost to the US economy of delaying TPP will be billions of dollars lost to our foreign competitors. Working with Congressional leaders, we will continue to work for passage of TPP as soon as possible to ensure that the economic benefits these endorsements cite are not delayed."