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Canada, the United States and the 10 other countries insist they are closer than ever to a massive Asia-Pacific free trade deal.
But closer does not mean a final Trans-Pacific Partnership (TPP) agreement is imminent. A year-end deadline for striking a deal is expected to pass without agreement in spite of fresh optimism expressed this week by Canadian Prime Minister Stephen Harper, U.S. President Barack Obama and other leaders meeting in Beijing.
That's because the toughest elements of the TPP remain unresolved, including the contentious area of market access for agricultural products.
The U.S., for example, wants a bigger slice of Canada's heavily protected dairy and poultry sectors and to at least match recent gains made by Europe in the areas of telecommunications, drug patent protection and provincial purchasing markets.
For its part, Ottawa will almost certainly seek to blunt a proliferation of protectionist Buy American purchasing rules on various federally funded projects and gain access to more government purchases.
Because both Canada and Mexico are part of the negotiations, the U.S. also sees the TPP as an opportunity to upgrade and modernize the North American free-trade agreement.
Ottawa views the TPP as a way to gain new access to lucrative Asian markets, most notably Japan, for Canadian beef and pork. But Japan hasn't yet moved substantially.
All of these issues are sensitive, and therefore may be tough to resolve quickly, explained Ottawa trade consultant Peter Clark. The danger, he said, is that the TPP gets watered down too much, alienating key founding partners such as New Zealand.
"There is a risk of it all unravelling," Mr. Clark said.
Toronto trade lawyer Lawrence Herman said it's "premature" to be talking about a deal being nearly done.
The TPP has already missed deadlines twice before, in 2012 and 2013. TPP leaders made no mention of the latest year-end deadline for striking a deal in their statement Monday. Nor did they set a new target date.
Still, two important things have happened recently to prod the TPP along. The Republicans seized control of the U.S. Senate in the Nov. 4 midterm elections, making it a friendlier environment for Mr. Obama to secure the vital trade negotiating authority from Congress he will likely need to finalize the TPP. And secondly, Japan and the U.S. have made modest progress in the area of autos in continuing TPP talks.
The U.S. must also realize that Ottawa's willingness to put its best offer on the TPP table would be greatly enhanced if Washington approved the long-delayed Keystone XL oil pipeline designed to deliver Alberta crude to refineries south of the border.