A ‘World First’ approach to trade
IT WAS an act of economic symbolism, whether intended or not. Exactly one year to the day on which United States President Donald Trump withdrew his country from the Trans-Pacific Partnership (TPP), the remaining 11 countries agreed to move ahead on a revised version of the pact. They settled their remaining differences over the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership, dubbed the TPP-11, after talks in Tokyo. The venue was symbolic as well. Japan, a key ally of the United States today, was an early beneficiary of the post-World War II system in which Washington reached out to countries in Asia and elsewhere. The US asked all to join it in a global partnership for free trade over the countervailing model represented by the Soviet Union and its communist allies. It is ironic Japan should find itself carrying a part of that American mantle in global affairs, following Trump’s rejection of America’s formative role in the peaceful creation of the Pacific’s architecture of prosperity and security.
Yet, this is a happy irony. No nation is powerful and great enough to enjoy lasting copyright on the evolution of history. That is so especially if populism within it obscures its beneficial role outside its borders. “America First” is but another name for protectionism. The TPP would have reinforced America’s international role, particularly in the Pacific, its global strategic backyard. That role appears to be receding. In its place, the oceanic gap could be reinforced by the Regional Comprehensive Economic Partnership, which would tie Asean into partnership with Australia, China, India, Japan, South Korea and New Zealand. Meanwhile, Beijing’s Belt and Road Initiative seeks to recreate relations among Asia, Europe and Africa into a coherent whole that would remove America from its erstwhile pivotal position in many intercontinental economic affairs.
The TPP-11 countries will have to produce results to uphold the credibility of their accord. That is true of all agreements. For Singapore, the stakes are clear. The TPP-11 will give its companies access to a market of 500 million people with a combined output of S$13.2 tril- lion (US$10 trillion). Domestic political sensitivities distance some other countries from the spirit of the agreement. But its intent is clear: Trade liberalisation is the way to the future, whatever its place of origin or its pace.
If the TPP-11 members can pull off the deal, they will prove that globalisation is unstoppable, even without the United States. That should send out a message to Trump to reconsider his rash decision to pull America out of the TPP. In any case, future American administrations will have an opportunity to ponder where their country fits into a global system which benefits its position in the world. Rejoining the TPP would be an option.