The United States becomes more active in trade policy, but may not be able to complete the ambitious trade deals with Asia and the European Union (EU) within the tight schedule, said an expert.
Transatlantic and trans-Pacific trade negotiations face complex challenges and will be difficult to conclude, said Stephen Lande, president of Manchester Trade, a Washington, D.C.-based consulting firm that specializes in international trade policy and investment advisory.
U.S. President Barack Obama has embarked on a more active trade agenda in his second term of office, aiming to complete negotiations on Trans-Pacific Partnership (TPP) by the end of this year and wrap up a U.S.-EU free trade agreement in two years.
As Japan recently announced its intention to participate in TPP talks that already involved 11 countries in 16 rounds of negotiations, Lande was cautious about the schedule for concluding TPP talks this year.
"It's very hard to conclude an agreement in a year. There are so many participants and so many issues," he said. "There are still lots of differences even though there's progress being made."
What's more, trade diplomacy intensified in the Asia-Pacific last year with the launch of Regional Comprehensive Economic Partnership negotiations between the Association of Southeast Asian Nations and six other Asia-Pacific countries, including China and India.
It may pose a challenge to the high-standard TPP, which includes issues of intellectual property that some of its members found demanding.
Last week, China, Japan and South Korea also concluded their first round of free trade talks. For the trade agreement between the United States and the EU, also known as the Transatlantic Trade and Investment Partnership, Lande noted that agriculture is a big problem. He added that market access, regulations and issues of common global concerns would be difficult to negotiate.
In addition, it's much more difficult for the Obama administration to advance these trade negotiations without a new trade representative in place, as Ron Kirk, Obama's main international trade negotiator in the past four years, stepped down a few weeks ago.
Reflecting on his 50-year career in international trade, Lande said that the biggest change for the global trading system was that it moved away from the consensus-based General Agreement on Tariffs and Trade, which used to be called the "General Agreement to Talk and Talk" as a joke, into the World Trade Organization (WTO) with binding dispute settlements, which forced countries to observe WTO rules to avoid retaliation.
"The legal system works. On the whole this recession did not see wholesale increase of protectionism," he noted.