Good timing for the Conservative party’s federal election campaign momentum, perhaps, but there’s no doubt that last week’s announced completion of Trans-Pacific Partnership (TPP) negotiations has far broader implications than parochial political gains.
Once ratified by its 12 member states, the TPP will reduce trade hurdles governing what is already a huge long-term 21st-century trade opportunity for this province. The fundamentals are significant by any measure: a marketplace with roughly 800 million people with a combined economy of more than $28 trillion that accounts for approximately one-third of global trade. Better still, the population of the 12-member TPP region has a relatively youthful median age of 33, and the deal will give B.C. greater access to Japan, its third-largest trading partner and the world’s third-largest economy.
Granted, unknowns in the deal abound. Its impact on the North American Free Trade Agreement, now a $19 trillion regional market, is one. But for B.C. the TPP promises to further accelerate business at the province’s rapidly expanding container and break-bulk ports; it also presents significant market growth opportunities in seafood, agriculture and forestry, where Asian tariffs currently range between 3.5% and 40%. Its effect on B.C.’s liquefied natural gas aspirations remains unclear, but there’s more to this province’s energy equation than what’s in the ground.
Southeast Asia, where energy demand is projected to jump 80% by 2040, needs the energy security that comes from developing domestic power sources. It’s therefore hungry for renewable energy technology. B.C., with its growing renewable power expertise and relative proximity to emerging Asian economies, is well situated to provide that technology.
There are winners and losers in any major international free trade deal, but those deals also reward innovation and penalize stagnation. That’s welcome tough-love tonic for an economy like B.C.’s, which, if it’s to achieve its potential, must be diversified beyond being a bargain basement natural resource warehouse for more innovative and ambitious competitors.
