Obama, Key aim for completion of Asia-Pacific trade deal by year's end

President Obama said Friday that he hopes a massive Asia-Pacific trade deal can be completed by year's end.

Obama said he discussed wrapping up work on the 12-nation Trans-Pacific Partnership (TPP) negotiations with New Zealand Prime Minister John Key for about an hour in the Oval Office.

"We discussed a timeline whereby before the end of the year, we're able to get a document that can create jobs both for New Zealand the United States and the other countries that are participating, and expand wealth for all parties involved," Obama told reporters after the meeting.

"Our hope is that by the time we see each other again in November, when I travel to Asia, we should have something that we have consulted with Congress about, something the public can take a look at, and we can make a forceful argument to go ahead and close the deal."

Both leaders said that the relationship between the two nations has never been stronger and they have the same goal for the trade deal.

"New Zealand and the United States have been two partners in the TPP that have always believed in a high quality and comprehensive agreement," Key said.

The president mentioned that he would like to visit New Zealand before the end of his presidency.

"New Zealand has a small population but great products and has a great interest in making sure that markets are open and that rules of the road are abided by when it comes to trade,” he said.

On Thursday, Key suggested that Japan should be removed from the Asia-Pacific deal if it won't fully open its markets or drop tariffs on its agricultural markets such as pork, beef, rice and dairy.

"If they can't meet those terms and the other 11 partners can, then we should get on and do a deal with those 11 partners," Key said at a U.S. Chamber of Commerce event.

Still, Key said his preference is to keep Japan in the talks. 

He expressed concern that lowering standards in any part of the agreement would ripple through the deal.

Japan's insistence on protecting the "sacred" sectors has angered U.S. agricultural groups who have said that Japan must agree to eliminate tariffs on all goods.

At a hearing last week, Rep. Devin Nunes, chairman of the House Ways and Means Subcommittee on Trade, said that Japan and Canada should be left on the sidelines of the TPP until they are willing to agree to eliminating tariffs.

“In negotiations for the TPP, I am concerned that the Administration is not holding Japan and Canada to the level of ambition that Congress has demanded,” he said.

At that same hearing, beef and dairy industry leaders urged TPP negotiators to continue working with Tokyo and pressure Japan to drop the tariffs. 

The groups have argued in recent weeks that Japan should get booted from the talks if it can't deliver on a full slate of tariff elimination and the greater market access Tokyo promised when they joined talks.

Still, while some farm groups have said Japan should excluded they also have said that talks need to continue, even if it takes more time to complete a deal. In the end, though, tariff elimination and greater market access is a must.

Supporters of the TPP have said that a strong agreement with Japan would smooth the deal’s completion whereas any major concessions would put the whole deal at risk.

House Ways and Means Committee Chairman Dave Camp (R-Mich.) said Thursday he still remains deeply concerned that Japan won’t remove agricultural and tariffs or open its market to more U.S. auto exports as part of the trade deal.

"Japan has been closed for too long, and it is time we finally get real access to its markets,” he said.  

“We cannot move forward on TPP with Japan until it commits to fully eliminate agricultural tariffs.”

Besides the United States, Japan and New Zealand, the other countries are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.