TOKYO, Dec. 31 ― The landmark Trans-Pacific Partnership (TPP) without the U.S., also known as TPP-11, entered into force on Dec. 30, 2018, bringing steep tariff cuts to the first six countries that ratified the trade pact, including Japan, Australia and Canada.
That will likely pose challenges for businesses that require Japanese farmers to increase competitiveness at home.
Vietnam will officially enter the pact on Jan 14, 2019, while Brunei, Chile, Malaysia and Peru will come on board 60 days after they complete their ratification procedures.
With the TPP-11, tariffs were slashed to zero overnight for some products, while others will be reduced over a period of up to 20 years. For Japan, as tariff reduction commitments mostly tied to the fiscal year, a second round of tariff cuts will take effect on April 1, 2019.
After the U.S. pulled out in January 2017, Japan led the trade deal to fruition. The deal retains all but 22 of more than 1,000 provisions in the original TPP.
Despite the U.S. pullout, the TPP-11 accounts for 13 percent of the global GDP, with a market size of about 500 million people.
The Japanese government is trying to mitigate domestic concerns among the farmers over an influx of cheap agricultural imports by offering them support to expand their businesses.
At the same time, the government insists that it will not review market access for agriculture products and trade remedies even the U.S. return to the trade deal is unlikely to happen.
The TPP-11 ministers will meet in Tokyo on Jan. 19 to discuss new members.