Free trade push amid Trump win

China Daily (USA) - - FRONT PAGE - By CHEN WEIHUA in Wash­ing­ton chen­wei­hua@chi­nadai­lyusa.com

China plans to push for­ward its free trade agenda at the up­com­ing Asia-Pa­cific Eco­nomic Co­op­er­a­tion (APEC) sum­mit in Lima, Peru, this month, at a time when the United States just elected anti-trade Don­ald Trump pres­i­dent.

In Bei­jing on Thurs­day, China’s Vice-For­eign Min­is­ter Li Baodong warned of the rise of pro­tec­tion­ism and said the re­gion needed a free trade agree­ment as soon as pos­si­ble.

“Trade and in­vest­ment pro­tec­tion­ism is rear­ing its head, and the Asia-Pa­cific faces in­suf­fi­cient mo­men­tum for in­ter­nal growth, and dif­fi­cul­ties in ad­vanc­ing re­forms,” Li was quoted by Reuters as say­ing.

“China be­lieves we should set a new and very prac­ti­cal work­ing plan, to pos­i­tively re­spond to the ex­pec­ta­tions of in­dus­try, and sus­tain mo­men­tum and es­tab­lish a free trade area in Asi­aPa­cific at an early date,” Li said at a brief­ing on Pres­i­dent’s Xi Jin­ping’s up­com­ing trip to APEC and the three Latin Amer­i­can coun­tries of Peru, Ecuador and Chile.

China has pro­posed the Free Trade Area of the Asia Pa­cific (FTAAP) and the Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP), seen as by some ob­servers as com­peti­tors to the US-led Trans-Pa­cific Part­ner­ship (TPP).

Li said Xi’s at­ten­dance showed China’s “con­fi­dence in pro­mot­ing the FTAAP process”.

“China is al­ways pos­i­tively ad­vanc­ing work on its own re­gional free-trade strat­egy. We, in­deed, are con­tin­u­ously and pos­i­tively ad­vanc­ing RCEP negotiations,” China’s deputy in­ter­na­tional trade rep­re­sen­ta­tive Zhang Xiangchen said.

While the TPP in­cludes 12 Pa­cific Rim coun­tries, RCEP em­braces the 10 mem­bers of the As­so­ci­a­tion of South East Asian Na­tions plus China, Ja­pan, South Korea, In­dia, Aus­tralia and New Zealand. China is not in­cluded in the TPP; the US was not in­cluded in RCEP.

The TPP has been op­posed by both Trump and Hil­lary Clin­ton, the Demo­crat can­di­date who lost the election to Trump on Nov 8. Most Demo­crat law­mak­ers op­pose TPP and the sup­port for TPP has also de­clined among Repub­li­can law­mak­ers, mak­ing it highly un­likely Obama will pass it through Con­gress dur­ing what’s left of his lame-duck ses­sion.

US Pres­i­dent-elect Trump had re­peat­edly blasted the TPP trade deal on the cam­paign trail, say­ing it would hurt Amer­i­can work­ers. He also vowed to can­cel the agree­ment, re­garded by Obama as a ma­jor part of ad­min­is­tra­tion’s legacy and es­sen­tial to his re­bal­ance to Asia strat­egy.

TPP has been widely re­garded as an Obama ad­min­is­tra­tion tool to ri­val China’s grow­ing in­flu­ence in a re­gion where China is the largest trade part­ner for most na­tions.

China be­lieves we should set a new and very prac­ti­cal work­ing plan (in Asia-Pa­cific) ... ” Li Baodong, vice-for­eign min­is­ter

“Trade agree­ments should not be strate­gic tools, rather they should of­fer hefty eco­nomic ben­e­fits,” Derek Scis­sors, a res­i­dent scholar at the Amer­i­can En­ter­prise In­sti­tute, wrote on Thurs­day at the Chi­naFile web­site.

An econ­o­mist, Scis­sors said when he read the en­tire TPP text a year ago, he did not find much in the way of net eco­nomic ben­e­fits, adding that the In­ter­na­tional Trade Com­mis­sion drew sim­i­lar con­clu­sions six months ago.

Scis­sors also ar­gued that there is no rea­son to link the ex­change rate of Chi­nese cur­rency to US jobs, clearly re­fer­ring ac­cu­sa­tions made by Trump on the cam­paign trail. “Try­ing to link the value of the RMB to Amer­i­can jobs re­quires con­tor­tions, since the most silent ev­i­dence shows they are not mean­ing­fully con­nected,” he said.

On Thurs­day, James Woolsey, the for­mer direc­tor of the Cen­tral In­tel­li­gence Agency and now a se­nior ad­vi­sor to Trump on na­tional se­cu­rity, crit­i­cized the Obama ad­min­is­tra­tion for fail­ing to em­brace the China-led Asian In­fra­struc­ture In­vest­ment Bank (AIIB), sug­gest­ing a pos­si­ble pol­icy shift in Jan­uary when the Trump ad­min­is­tra­tion takes con­trol.

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