By guest author Gemma Alexander
The Trans-Pacific Partnership (TPP) is one of the largest trade agreements in history. The 12 countries involved in the agreement—the U.S., Japan, Malaysia, Vietnam, Singapore, Brunei, Australia, New Zealand, Canada, Mexico, Chile, and Peru—account for 40 percent of the world economy.
The TPP is also notable as the first trade agreement to directly address the barriers small companies face in expanding into foreign markets. This sounds like a great step forward, but the TPP has garnered heavy opposition. So, is it good for small businesses, or not?
Even before the final agreement was published for review on Nov. 5, 2015, a Fortune editorial celebrated the TPP for including a chapter aimed at eliminating or minimizing trade barriers that disproportionately challenge small and medium-sized companies (called SMEs in the agreement).
But on first review, Chapter 24 of the TPP, Small and Medium-Sized Enterprises, doesn’t appear very substantive—it’s only three pages long and contains just three articles. But that doesn’t mean the TPP isn’t important for small business owners. Virtually all aspects of the economy are impacted by the agreement, and many chapters of the agreement include provisions that specifically affect small American businesses expanding into international markets.
The official summary from the Office of the United States Trade Representative identifies some of these provisions:
With benefits like these, the TPP seems like a clear win for everybody, but it faces such fierce opposition that supporters are far from confident Congress will pass the agreement. Some of the opposition can undoubtedly be attributed to partisan politics, but tellingly, both Bernie Sanders and Hillary Clinton oppose the TPP, despite President Obama’s support.
The opposition comes from several different aspects of the TPP:
Both opponents and supporters can agree that the Trans-Pacific Partnership would make a huge impact on trade, and by extension, the average American. But both sides are making broad claims about the impact in both directions, when in reality the TPP is a conglomeration of very specific provisions, with numerous exceptions and special cases. The inclusion of provisions addressing environmental standards, labor protections, and support for small businesses is without doubt an improvement over past trade agreements. But a careful reading is required to determine who benefits the most.
The full text of the TPP is available online. It’s not an easy read, but anyone with dreams of doing business internationally should review the contents.
About the Author: Gemma Alexander is a Seattle-based freelance writer specializing in technical topics for general readers. She also writes about legal issues in everyday life on the Avvo Stories blog. Avvo helps people find and connect with the right lawyer through industry leading content, tools and services. A free Q&A forum with more than 9 million questions and answers, along with on-demand legal services that provide professional counsel for a fixed cost, make legal faster and easier. For more information, visit www.avvo.com.
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