The Atlanta company that likely stands to see its business impacted most by the Trans-Pacific Partnership on Friday welcomed the announcement that talks on the sweeping free-trade deal would take place in its hometown.
Officials from United Parcel Service Inc., the logistics and package delivery giant, believe the trade deal stands to benefit U.S. exporters while at the same time helping grow trade within Asia, a fast-growing region the company has been investing heavily to serve.
The Office of the U.S. Trade Representative on Thursday confirmed Global Atlanta’s earlier report that chief trade negotiators from the 12 TPP party countries would arrive in Atlanta Saturday for three days of talks aimed ironing out remaining sticking points in the deal. That will be followed by a meeting of their trade ministers here next Wednesday.
“UPS has been a strong proponent in advocating for Atlanta to serve as a site for a negotiating round,” Leslie Griffin, the company’s Washington-based senior vice president for international public policy, told Global Atlanta in an interview. “Atlanta is an important global market. We have a business community that is globally aware with a growing number of small and medium-sized companies becoming more and more active in trade. Atlanta businesses will clearly benefit from stronger ties with the parties to TPP.”
Ms. Griffin said UPS generally sees its export volumes from the U.S. jump 20 percent on average after the completion of free trade agreements, and that’s in the case of bilateral deals. The TPP includes the U.S. and 11 other Pacific Rim nations from Southeast Asia to South America encompassing 40 percent of global gross domestic product.
While its main air hubs are in China (not a TPP country), UPS has its Asia headquarters in Singapore and is increasingly active in Southeast Asia.
“With a 25-year history operating in the region, more than 15,000 employees and over 500 facilities, The Asia-Pacific is an important part of the world for us and it’s one that’s going to be increasingly important,” Ms. Griffin said.
Within the content of the TPP, UPS will be looking for aspects it wants to see in most FTAs: agreements to modernize and procedures for customs which will smooth the movement of goods.
The deal could also create new supply chains within Asia as countries further integrate their sourcing patterns a result of the deal, Ms. Griffin said.
That’s exactly what has kept countries like Canada from embracing the deal more fully: The auto industry there worries that the loosening of rules on how much of a product should be made within TPP nations to qualify for duty-free status would allow Asian suppliers to undercut its position as a supplier to the U.S.
But Ms. Griffin said it’s also helpful to look at opportunities for North American manufacturers in Asia. One example: Vietnam has a 27 percent tariff on auto parts from the U.S., giving regional competitors a pricing advantage that would go away if the TPP enters into force.
Many of the partner countries in the TPP have bilateral FTAs — the U.S. and Chile, along with the U.S., Canada Mexico, and so on. The TPP would strengthen existing deals by helping them catch up with the times, Ms. Griffin said.
“Each time a new deal is negotiated, you’re modernizing, and making sure the trade agreements better reflect the realities of how trade takes place,” she said.
The prospect of finalizing a deal comes as multiple organizations and companies across Atlanta have come together under the Metro Export Plan to systematically help companies boost overseas sales.
Mayor Kasim Reed said the TPP talks underscore the importance of trade to the Atlanta area.
“We know that companies that export grow faster, pay higher wages, and are less likely to go out of business than companies that rely solely on the domestic market. Already more than 150,000 jobs are supported by export and import activity in the metropolitan area,” the mayor said in a statement welcoming the news that Atlanta would host the talks.
The USTR’s office didn’t respond to questions about where the negotiations are to be held in Atlanta. Labor groups are planning protests against the deal, which many see as secretive and poised to send jobs overseas. Calls to Delta Air Lines Inc., another big Atlanta employer seeking to deepen ties in Asia, weren’t returned Friday.