WRAPUP 2-Pacific trade talks step closer to clearing auto parts hurdle

Thu Oct 1, 2015 12:34am EDT
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By Ana Isabel Martinez and Kevin Krolicki

ATLANTA, Sept 30 (Reuters) - Negotiators trying to clinch a Pacific Rim free trade deal made headway on Wednesday over how to remove a stumbling block and give automakers a freer hand to sell cars in the United States with more parts purchased in Asia.

People briefed on the closed-door talks said Canada and Mexico signaled a willingness to open the North American auto market to more parts made in Asia, one of the key hurdles to sealing a broader deal on the Trans-Pacific Partnership.

The TPP seeks to cut trade barriers and set common standards among a dozen nations reaching from Japan to Chile, but talks have become snared over a small set of issues, including dairy trade and patent periods for biologic drugs.

Japan has pushed hard during talks in Atalanta for a deal on auto parts, a crucial issue for Japananese carmakers, led by Toyota Motor Corp, who depend on sales to the U.S. market and want flexibility in how and where they source parts.

"We have to head into this with the expectation that we can wrap things up," Japanese Economy Minister Akira Amari was quoted by Japanese media as saying.

Australian Trade Minister Andrew Robb said ministers meeting on Wednesday had detailed remaining issues.

"There's an intent there. We are now swapping different versions of possible outcomes, but we have got a lot to do," Robb told Reuters after the plenary session on the TPP.

An earlier round of talks in July had failed after Mexican officials objected to a proposal by Japan and the United States on autos concerning the "rules of origin" that determine whether a vehicle can be exported without tariffs.   Continued...