Trans-Pacific Partnership (TPP)
What Is The Impact Of Trans Pacific Partner Australian?
Global strategic management involves the process of laying down strategies and policies to guide the flow of activities and programs of an organization either locally or at international level setting. The term global strategic management can be shortened to global strategy. Global strategy means a coverage of three areas, which include global, multinational and international strategies. The three areas help an organization to reach international level (Lasserre, 2017, p.58). International strategy is the positioning of an organization in a more competitive advantage position, this helps specifically for the home market. The multinational strategy involves how to connect to markets beyond home country. This promotes competitive advantage. The global strategy is where the organization treats the whole globe as one market. The strategy of an organization going global is important since the business name is globalized and this creates a competitive advantage. Some customers also prefer to purchase goods and services that are internationally produced and manufactured due to the issue of price (Shenkar, Luo and Chi 2014, p.17). Global strategic management simply deals with the management of business organization at a universal level, which requires skills and knowledge for the speedy and clear flow of transactions.
Trans-Pacific Partnership (TPP) is an agreement between countries namely Brunei, Australia, Chile, Canada, Malaysia, Japan, Mexico, New Zealand, Vietnam, Peru, Singapore and the United States of America. The agreement made between these countries was the agreement on transacting businesses and ensuring good trade exists between the countries (Petri and Plummer 2016). The US decided to come out of the association, which made the trade agreement name TPP to be changed to Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Most of the policies and relations put in place in the TPP now belong to the latter agreement formed. The original TPP had policies to lessen the tariffs that are the main causes of barrier in trade. It would also help establish an investor-state dispute settlement (ISDS) also called an Investment Court where countries are able to sue and report discrimination occurrences. Australia forms part of the agreement as one of the party members. The presence of Australia have benefits to it and some trade backs. Nevertheless, the benefits tend to be much more compared to the disadvantages. The rest of the members of the agreement also benefit a lot from the existence of the relation between the above countries, which all equally have something to share in the trading market (Boardman, Greenberg, Vining and Weimer 2017, p.53). The mutual association is the motivating power and influence that helps them to work together.
Opportunities presented to Australian Business by TPP
Trans-pacific partnership have produced many gains to Australia, which brings positive impact to the countries. Though there are some trade-offs, the advantages are more which has helped to boost the economy of the country. Australia is an ever growing country categorized in the advanced countries, these pushes a need to get associated with the follow same level countries so that to maintain their status. Firstly, the partnership has helped in creation of new markets for Australia. The existing markets are expanded, they are made more advanced so that to help the ever-growing businesses. The partnership helps to bring new items from different countries in the market, which pushes for new markets, which are established within the country (Hair, Wolfinbarger, Money, Samouel and Page 2015, p.43)
Small business benefit from the partnership, which is in nature global. The small businesses through the partnership formed obtain the ability to exports their goods on international bases within the member countries. Massive creation of employment is what follows which is brought about by many jobs created because of the partnership. Many people initially unemployed are able to secure jobs. The partnership helps to remove initial restrictions that were within the countries. This means that the country is able to trade freely with the other membership country. It has really helped Australia to be in a position conduct businesses in a good terms.
The removal of restrictions goes hand in hand with reduction of taxes for good entering the countries within the partnership. In this, Australia have experienced a reduced amount of taxes hence retaining a lot of profit in the transactions it makes with members of Trans-Pacific partnership. The partnership promotes the growth of digital economy; this is where businesses are transacted online in the internet range. Digital economy is also promoted within Australia since there exists a policy in the partnership, which sees that electronically transmitted commodities are not imposed import duty when entering in the country. (Holroyd and Coates 2015)The trade agreement make it easier for companies within Australia to conduct speedy production since there are regional promotion of production, which is followed by unmatched supply of the commodities produced. The Gross National Product (GNP) and Gross Domestic Product (GDP) are on the rise since huge transactions are now promoted between the partnered countries with the Australia. It means that the economy of Australia is stabilizing which in turn helps to change the living standards to the betterment for the Australians. It means that Australia will have the ability to provide basic services like healthcare, good infrastructure and proficient education to the Australians.
Major Tradeoffs of TPP on Australian Businesses
Australia have an opportunity to invest in the countries that they have collaborated with. For instance, the Singapore encourage investors from Australia who contribute to the Australian economy. Most of the Australia citizens are not born within the country, they are individuals whose origin can be traced to the countries in partnership (Lumsden and Knight 2017)It means that good cohesion is formed when these countries partner together and citizens may have the opportunity to enjoy dual citizenship which is a good thing for them. Australia has the advantage of enjoying loans from partnered countries, the financial helps from these countries come with low level of interests, which make it efficient to repay, and aids at funding government activities. (Kidwell, Blackwel, Sias, and Whidbee 2016, p.54)
In case of any complaints within the member countries, cases of discrimination and dissatisfactions from member countries, they are presented to the investor-state dispute settlement, which acts as a court; this is a security to Australia. Good governance and a reduction of corruption are other good items that Australia also benefits from the partnership. A protection of Australian laborers by the strong labor standards formed in the agreement will help protect the rights of the Austrian laborers within other countries in the partnership.
Nevertheless, the Trans-pacific partnership experience challenges that come by with it that. They affect the Austria interests either positively or negatively. Some countries within the partnership are exploiting in nature and overcharge their exportation goods. Australia is one the country within the partnership is immensely affected by this. (De Brito, Kauffmann and Pelkmans 2016) The overcharged cash could have been used in other economic activities within the country. Membership withdrawal is another challenge that Australia is to face within the TPP partnership. The US is one of the members of the TPP partnership withdrew from the partnership. This meant that the advantages that Australia businesses were getting from the US were reaped off. It means that with the removal of the privileges, some Australia businesses concentrated on the US had to stand down, meaning a negative gradient movement to the general economy (Rimmer, 2017, p.29).
Another major tradeoff facing the TPP in Australia is the domestic production and selling of drugs and medicines. The war on the price and the producers of the drug is at peak because of most manufacturers within the TPP, who sell drugs at high prices making it hard for Australian inhabitants to purchase them. There are also the generics producers, which compete with initial set forms for production of drugs. It becomes hard for Australia drug industries to manage this since most of the generic producers sell the drugs at the high price making the original producers be more expensive. Thence, drugs has become so expensive for people to afford which is a challenge (Schweitzer and Lu, 2018, p.106). One of the key policy of the TPP is to offer employment for many individuals, this has been a major challenge since the population of Australia is ever growing and it becomes hard for TPP to provide employment for all individuals lacking jobs hence some people remain unemployed. TPP does not fully meet all requirements anticipated by Australia. Thus, many problems remain unsolved.
Conclusion
In summary, Trans-pacific partnership, existing between Australia and other countries has both benefits and tradeoffs. Many are the positive impacts experienced in the member countries, Australia being one of them. Some major benefits include exemptions for taxes for both imports and exports goods within Australia, promotion of economy due to the high rate of the transaction of businesses from sectors within Australia and those outside, members of TPP. (Broude, Haftel and Thompson, 2017, p.77) The GDP and GNP of Australia are increased because of transactions made within TPP partnerships businesses. It, in turn, promotes the welfare of individuals within Australia by helping them to have better life. Some of the compromises of TPP, which affect Australia, include withdrawal of some member groups like The US, expensive drugs trading and exploitations from some members of TPP. It is evident that the formation of the TPP partnership, Australia being one the member states, it has led to both positive and negative impact on Australia business, with the positive side being the denser side.
References
Boardman, A.E., Greenberg, D.H., Vining, A.R. and Weimer, D.L., 2017. Cost-benefit analysis: concepts and practice. Cambridge University Press.
Broude, T., Haftel, Y.Z. and Thompson, A., 2017. The Trans-Pacific Partnership and Regulatory Space: A Comparison of Treaty Texts. Journal of International Economic Law, 20(2), pp.391-417.
De Brito, A.C., Kauffmann, C. and Pelkmans, J., 2016. The contribution of mutual recognition to international regulatory co-operation (No. 2). OECD Publishing.
Hair Jr, J.F., Wolfinbarger, M., Money, A.H., Samouel, P. and Page, M.J., 2015. Essentials of business research methods. Routledge.
Holroyd, C. and Coates, K.S., 2015. The Global Digital Economy: A Comparative Policy Analysis-Student Edition. Cambria Press.
Kidwell, D.S., Blackwell, D.W., Sias, R.W. and Whidbee, D.A., 2016. Financial institutions, markets, and money. John Wiley & Sons.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Lumsden, A. and Knight, L., 2017. Australia’s foreign investment approval regime: a new way forward. International Journal of Public Policy, 13(3-5), pp.232-243.
Petri, P. and Plummer, M., 2016. The economic effects of the Trans-Pacific Partnership: New estimates.
Rimmer, M., 2017. The Trans-Pacific Partnership: Intellectual property, public health, and access to essential medicines. Intellectual Property Journal, 29(2), p.277.
Schweitzer, S.O. and Lu, Z.J., 2018. Pharmaceutical Economics and Policy: Perspectives, Promises, and Problems. Oxford University Press.
Shenkar, O., Luo, Y. and Chi, T., 2014. International business. Routledge.
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