Without US, 11 Asia-Pacific states to sign trade deal
Eleven Asia-Pacific nations on Thursday were to sign a slimmed-down trade pact to lower tariffs just as US President Donald Trump seeks to raise them after withdrawing from the deal last year.
The Trans-Pacific Partnership (TPP), which would have represented 40 percent of the global economy and nearly one-quarter of its trade, was left for dead after Trump pulled out to pursue his “America First” agenda before the TPP could take effect.
But the revamped deal, now known as the Comprehensive and Progressive Agreement for TransPacific Partnership (CPTPP), is still a significant achievement that sends a message of openness, its supporters said ahead of the signing ceremony in Santiago, Chile.
The pact will include Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, representing together 13.5 percent of global gross domestic product.
The 11 states form a market of 500 million people, greater than that of the European Union’s single market.
“While taxes are going to be applied to certain products and there is a threat of a trade war, we are going to give a signal of openness,” said Chilean Foreign Minister Heraldo Munoz.
“It’s the most important free trade agreement and the most rigorous that has been signed until now in the world.”
The TPP, pushed by former president Barack Obama’s administration, was not only to cut tariffs but required members to comply with a high level of regulatory standards in areas like labor law and environmental protection.
Fernando Estenssoro, of Chile’s University of Santiago, says the revamped pact will be “a type of suicide” for the US.
The CPTPP aims to slash tariffs among the 11 members and foster trade to boost growth.
Felipe Lopeandia, Chile’s top trade negotiator, said the deal will “send a political signal to the world and to the US itself, that this is a global agreement.”
It is one which remains hugely significant, said Ignacio Bartesaghi of the Catholic University of Uruguay’s business school.