Key sees more TPP traction after US mid-terms

New Zealand Prime Minister John Key expects the US federal government to start throwing its weight behind concluding the Trans-Pacific Partnership regional trade and investment agreement once it gets past its mid-term Senate and Congress elections in November.

Negotiations between the 12 nations, including New Zealand, have stalled with the US and Japan dragging their heels on the deal, which could create a new Pacific Rim free trade agreement that extends more deeply than past FTA's into investment, regulatory, and other areas requiring a balance between national sovereignty and expected economic gains.

Speaking to the Deloitte-Business NZ election conference in Wellington, Key said US President Barack Obama is biding his time before throwing his weight behind the negotiations, with tepid support from his own Democrat party.

"I'm of the view Obama won't go anywhere near this thing prior to the mid-terms before November," Key said. "Obama keeps saying to me, 'we're going to do a good deal, we're going to get it done'."

Last week, Obama shelved plans to take executive action to change immigration policy until after the mid-terms in a highly charged political climate, with the stalemate between the Republican-controlled House of Representatives and the White House causing a brief government shutdown last year.

New Zealand's Key defended the secrecy of the TPP negotiations, saying it's standard practice for free trade agreements and said much of the commentary around the deal is false. He again affirmed the government's commitment to protecting drugs buying agency Pharmac and the ability of the government to legislate.

On the government's decision to halt its free trade talks with Russia, Belarus and Kazakhstan over heightened tensions between Ukraine and Russia, Key said it wouldn't be realistic for New Zealand to advance those negotiations, given the stance of traditional allies Australia, US, UK and Canada.

"It's not going to happen until the issue settles down in Russia," he said.

(BusinessDesk)