'Fast-track' trade boost for Obama

US lawmakers on Thursday introduced a bipartisan bill to grant President Barack Obama the "fast-track" authority he needs to conclude a Pacific Rim trade deal with Japan and 10 other economies that sits at the centre of his second-term economic policy.

The move sets the stage for a rush over the next few months to get what is formally known as Trade Promotion Authority through Congress, and conclude the long-awaited Trans-Pacific Partnership, which covers some 40 per cent of the global economy and is a key component of the US response to China's economic rise.

Republican leaders in Congress have identified trade as one of the few areas in which they see eye to eye with the Obama administration and said they wanted to see swift passage of the bill giving the president fast-track powers. But the bill still faces stiff opposition from many Democrats who are being lobbied heavily by trade unions and other core Democratic constituencies opposed to the TPP.

The legislation was introduced on Thursday by Senator Orrin Hatch, the Republican chairman of the Senate finance committee, and Paul Ryan, the Republican chairman of the House Ways and Means Committee. It was also endorsed by Senator Ron Wyden, the top Democrat on the finance committee.

Under the US constitution, Congress has jurisdiction over foreign trade. But for decades it has used legislation to set US trade objectives while also ceding the function of negotiating trade agreements to the presidency.

Fast-track legislation commits Congress to holding simple up or down votes on trade agreements within 90 days of them being presented. It is seen as crucial by other countries negotiating with the US as it ensures deals reached at the negotiating table are not ripped up and refashioned by Congress.

Mr Obama, who has been battling scepticism over past trade agreements within his party and sought to sell the TPP as a key element in his push to create new middle class jobs, welcomed the legislation. "I look forward to working with Democrats and Republicans in Congress to pass this bill, seize this opportunity, and support more good American jobs with the wages and benefits hardworking families deserve," he said in a statement.

Business groups also were eager to express support. "In today's tough international markets, we need our trade negotiators to tear down the foreign tariffs and other barriers that too often shut out US products," said Tom Donohue, head of the US Chamber of Commerce. "However, to secure new growth-creating trade pacts such as the trans-Pacific and trans-Atlantic agreements now under negotiation, Congress must first approve TPA."

The Trade Promotion Authority bill is expected to pass through the Senate quickly. It faces a tougher fight in the lower House of Representatives where much of the Democratic opposition is concentrated and some conservative Republicans are resistant to granting Mr Obama any trade powers. But many business groups say they expect the legislation to succeed.

The administration's lack of fast-track authority has put a brake on negotiations for the TPP, which after five years are close to resolution. Japan and other countries have been holding off submitting their final and best offers, and ministers have rescheduled several times a concluding meeting needed to reach the final compromises.

Tim Groser, the New Zealand trade minister and a senior figure among TPP negotiators, said Congress granting Mr Obama fast-track authority would "unleash the end game" of the TPP.

But in an interview with the Financial Times he also warned that if Congress failed to pass the legislation it would very likely kill the TPP and send other countries searching for alternatives.

The support from countries like New Zealand and the UK for the new China-backed Asian Infrastructure Investment Bank in recent weeks was an example of what could happen, he said.

"What happened on the AIIB should be a very significant marker," Mr Groser said. "The rest of the world will no longer wait, even for the United States."

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