TPP expected to ease trade barriers for tea
The recently signed Trans-Pacific Partnership has already boosted the share price of Japanese tea manufacturer ITO EN and is likely to have favorable long-term consequences for tea trade. The treaty, signed between 12 countries, including US, Canada and Japan, and encompassing about 800 million people and about 40% of global gross domestic product, is intended to bring down trade barriers for a wide variety of industries, including tea. For example, following the announcement of the deal, share price in ITO EN, a Japanese iced tea maker with a sizeable presence in the US, rallied, as TPP will enable the company to import tea leaves from abroad without the 17% tariff currently in place in Japan. Many other companies are likely to benefit too, as trade regulations will be harmonized to enable free movement of goods, services and capital among the participating countries.