Instead, leaders from Japan’s Shinzo Abe to Australia’s Malcolm Turnbull worked through a series of disputes to forge an agreement to keep the framework alive. And while there’s always a chance the U.S. will return to the fold, the TPP -- with a new tongue-twister of a name -- will prove an economic and political force regardless, not to mention a rival to a proposed new trade agreement including China.
It’s much like the original agreement in 2015, expanding free-trade rules beyond agriculture and services, embracing the digital economy and adopting stronger protections for intellectual property. Unlike a traditional trade deal that merely covers the exchange of goods and services, there are broader requirements in areas such as labor issues, the environment and government procurement. The wording agreed in Tokyo in January was essentially the same as before, but with some of the nitty-grittysuspended; for example, investors’ ability to sue governments will be cut back and copyright protection will not need to be extended as previously planned.
The old TPP is now the CPTPP, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Trade ministers from the 11 nations that stuck with TPP talks -- Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam -- signed the CPTPP agreement in Chile on March 8. At least six countries or 50 percent of the signatories must then ratify the agreement for it to come into force. Japan hopes this will happen in 2019.
The 11 members combined account for about 13 percent of global gross domestic product -- a little over half the U.S. share of 24.5 percent. But each can expect additional growth in national income of about 1 percent on average by 2030, according to an analysis by Professor Shujiro Urata of Waseda University in Tokyo.
Yes. It’s an open agreement with the flexibility to include others. Thailand, Indonesia, South Korea, the Philippines and Taiwan have all indicated interest in joining, as has the U.K.
That’s hard to tell and is up to Trump. In January, he said he “would do TPP if we made a much better deal than we had.” Australia’s Turnbull said that the new 11-nation deal is designed to “re-admit a member like the U.S. that chose to pull out.” And 25 senators from Trump’s own Republican Party sent Trump a letter asking him to “re-engage with the Trans-Pacific Partnership.” Whether the U.S. is in or out has implications for major nations inside and outside of the new deal, including Japan and China.
As by far the largest economy in the group, Japan took the initiative to persuade others to keep the deal alive -- hosting most of the meetings, for instance. One of the main reasons was Abe’s hope of getting the U.S. back in. Japan is seeking to defend the rules-based economic order in the Asia-Pacific region to counter China’s growing sway, at a time when the U.S. appears to be paring back its influence.
Despite the fact that it is less far-reaching in scope than TPP (it’s more of a traditional trade pact), negotiators have struggled to make progress since the first round of talks in 2013. India and Southeast Asia’s Asean countries agreed in January to “intensify efforts in 2018 toward the swift conclusion” after missing previous deadlines. Philippine Trade Secretary Ramon Lopez said last year a signing could come in 2019.
By Isabel Reynolds and David Tweed
From Bloomberg
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