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Problems mount for White House in push for Trans-Pacific trade pact

U.S. Treasury Secretary Jack Lew speaks at Center for American Progress 10th Anniversary policy forum in Washington, October 24, 2013. REUTE
U.S. Treasury Secretary Jack Lew speaks at Center for American Progress 10th Anniversary policy forum in Washington, October 24, 2013. REUTE

By Elvina Nawaguna

WASHINGTON (Reuters) - A White House push for a freer hand to clinch trade deals ran into a roadblock on Wednesday as two-thirds of Democrats in the House of Representatives stated their opposition, complicating efforts to finalize a pact with 11 Pacific Rim countries.

Obama administration officials have argued that Trade Promotion Authority, which would prevent Congress from amending trade deals, is needed to assure trade partners that any agreements will not be reopened. Without it, securing trade deals becomes more difficult.

In a letter to President Barack Obama, 151 House Democrats said there had not been enough consultation between the administration and Congress over the proposed Trans-Pacific Partnership, or TPP pact.

"Given our concerns, we will oppose 'fast track' Trade Promotion Authority or any other mechanism delegating Congress' constitutional authority over trade policy that continues to exclude us from having a meaningful role in the formative stages of trade agreements and throughout negotiating and approval processes," the lawmakers said.

The letter was the latest sign of trouble for the administration's hopes of securing a TPP deal by the end of the year. The lack of Trade Promotion Authority could also be a problem for Washington's ongoing talks on a free trade pact with the European Union.

On Tuesday, 22 House Republicans said in a letter to U.S. Treasury Secretary Jack Lew that granting so-called fast-track trade negotiating authority would amount to "delegating away Congress' constitutional authority over trade."

The administration has asked Congress to quickly pass TPA, but no legislation has been put forward in either the Republican-controlled House or the Democratic-controlled Senate.

The TPP, which would include Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam in addition to the United States, would establish a free-trade bloc stretching across a region that makes up nearly 40 percent of the global economy.

But the negotiations, which have been going on for three years, have been mired in controversy over a lack of transparency and slowed by the conflicting interests of the negotiating countries, U.S. lawmakers and advocacy groups.

Previously, 230 U.S. House members and 60 senators had written the administration to demand any deal ensures member countries do not engage in unfair currency practices that could hurt the U.S. economy.

Republican Senator Lindsey Graham and Sander Levin, the top Democrat on the House Ways and Means Committee, said on Wednesday that they would reject any agreement that did not contain a currency manipulation clause.

"You've got to be willing to vote 'No' if (currency manipulation) is not addressed," Graham said.

A draft of the intellectual property chapter under discussion in the TPP talks released by WikiLeaks on Wednesday revealed serious rifts among the countries participating, and raised further doubts about concluding an agreement by year end.

Consumer groups complain that the secrecy surrounding the talks limits the voice of regular people, in favor of industry. They are especially concerned that a U.S. push for stronger patent protection for pharmaceuticals could make access to quality medical care difficult in developing countries.

Gary Hufbauer, a trade expert at the Peterson Institute for International Economics, said Obama faced the tricky task of winning over Democrats on the left who are traditionally opposed to trade agreements and right-wing Republicans who do not want to grant him any concessions.

"He may have to schmooze and horse-trade, but those are two things he's not been very good at in the past," Hufbauer said.

(Reporting by Elvina Nawaguna; Additional reporting by Anna Yukhananov; Editing by Paul Simao)

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