TPP will open markets, but may see plants closed

TORONTO — The Trans-Pacific Partnership has the OK from a dozen countries, but not everyone is convinced the new trade deal is the right thing for Canada.

The TPP has been in the works for a decade. Signed by 12 nations, including Canada, the United States, Japan and Australia, the deal expands trade opportunities among the countries.

Some economists say consumers could see lower prices once the deal is ratified.

READ MORE: Will the TPP bring change to countries with poor labour records?

“Potentially lower prices at the grocery store, when you go to the clothing store there’ll be an impact there — and job creation — as Canadians become more international,” said David Watt, chief economist with HSBC Bank of Canada in Toronto.

Many in Canada’s agriculture and agri-food industries have welcomed the signing of the TPP in Atlanta.

“We have that level playing field and we have some new opportunities,” said Martin Rice, executive director of the Canadian Pork Council.

But much of Ontario’s auto industry isn’t cheering.

READ MORE: TSX, U.S. stocks rise sharply as new TPP trade deal announced

Jim Stanford, economist with Unifor, Canada’s largest private-sector union, which counts GM, Ford and Chrysler workers among its members, says the results of the deal will jeopardize 20,000 jobs.

“We are definitely going to see plant closures in the first year of TPP,” said Stanford, who says auto parts plants and traditional assembly plants will be shuttered.

Under the North American Free Trade Agreement, or NAFTA, the minimum North American content requirement for a fully-assembled vehicle was 62.5 per cent.

Under TPP, vehicles with as little as 45 per cent domestic content will quality for tariff-free movement.

Hartford says, if ratified by Parliament after the election, the auto industry would be open to cheaper, foreign parts.

READ MORE: The TPP deal needs to be voted on. What will the Liberals and NDP do?

Other critics say the cost of pharmaceutical drugs could also rise.

Despite the potential for more competition, Medicines Sans Frontieres/Doctors Without Borders says pharma companies would likely be allowed to retain more rights to producing drugs, at the expense of generic drug manufacturers and consumers.

“It will be more difficult for competition and more easy for pharmaceutical companies to increase profits,” Judit Rius told Global News from New York.

“Consumers need access to affordable medicines; innovation without access is meaningless,” she said.

READ MORE: Canadian auto union slams TPP deal, calls new content rules ‘outrageous’

The TPP still requires ratification by each country.

If re-elected, Conservative leader Stephen Harper says his government would move ahead with the pact.

NDP leader Tom Mulcair says he would repeal the deal.

Liberal leader Justin Trudeau says he would need to study the terms of the deal more before making a decision on its future.