‘GO AHEAD WITH TRADE PACT’

Give up on US and in­cor­po­rate TPP stan­dards into other re­gional deals, urges ASPI

New Straits Times - - Business World -

ASIAN coun­tries should pur­sue a Pa­cific trade pact even af­ter the United States walked away, and its stan­dards should be in­cor­po­rated into other re­gional deals, ac­cord­ing to a re­port au­thored by half a dozen for­mer trade en­voys.

Don­ald Trump with­drew from the 12-na­tion Trans-Pa­cific Part­ner­ship (TPP) in one of his first acts as US pres­i­dent, throw­ing an agree­ment that cov­ered 40 per cent of the global econ­omy into dis­ar­ray.

That’s left the other na­tions scram­bling on what to do: Ei­ther try and proceed with­out the US, hope Trump changes his mind (or Congress does), or pri­ori­tise a sep­a­rate re­gional deal be­ing cham­pi­oned by China.

The pres­i­dent has at­tacked trade deals in gen­eral and touted an “Amer­i­can First” doc­trine that would pun­ish coun­tries whose poli­cies are deemed by the ad­min­is­tra­tion to be un­der­min­ing US jobs.

But the rest of the world shouldn’t em­brace Trump’s pro­tec­tion­ism, the Asia So­ci­ety Pol­icy In­sti­tute (ASPI) re­port ar­gues.

“Just be­cause the US is less sup­port­ive of trade and glob­al­i­sa­tion does not mean that the rest of the world will fol­low suit,” said the re­port au­thored by Wendy Cut­ler, a nearly three­decade veteran of the Of­fice of the US Trade Rep­re­sen­ta­tive, and six for­mer trade of­fi­cials from Aus­tralia, China, Ja­pan, South Korea, In­done­sia, and the Philip­pines.

“Should pro­tec­tion­ism and iso­la­tion­ism pre­vail, the Asia-Pa­cific re­gion could be­come less open and in­te­grated, up­set­ting the re­gional eco­nomic and se­cu­rity bal­ance,” said the writers.

Trump’s ad­min­is­tra­tion has de­clared the US isn’t bound by de­ci­sions made at the World Trade Or­gan­i­sa­tion (WTO) and said Amer­ica planned to de­fend its “na­tional sovereignty over trade pol­icy”.

The clouded fu­ture for TPP — a higher-val­ued pact that in­cluded pro­vi­sions for things like in­tel­lec­tual prop­erty, state-owned en­ter­prises and en­vi­ron­men­tal and labour stan­dards, has seen some Asian na­tions turn to the 16-na­tion Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP), seen as a more tra­di­tional deal.

The WTO and Asia-Pa­cific Eco­nomic Co­op­er­a­tion fo­rum should take the lead com­mu­ni­cat­ing the ben­e­fits of free trade agree­ments “us­ing con­crete terms which are mean­ing­ful to the ev­ery­day in­ter­ests and con­cerns of or­di­nary peo­ple”, said the ASPI re­port.

The au­thors con­cluded that re­gional trade pacts were the best path for lib­er­al­is­ing trade, rais­ing stan­dards and pro­mot­ing re­forms.

And they called on the US to re­con­sider its par­tic­i­pa­tion in TPP and wel­comed pro­pos­als by some TPP sig­na­to­ries to go ahead re­gard­less.

Aus­tralia is push­ing for a TPP with­out the US. At least 11 coun­tries, in­clud­ing China, Ja­pan and South Korea, would at­tend a March 14-15 sum­mit in Chile on trade where the TPP would be dis­cussed, ac­cord­ing to a re­port by Bloomberg BNA.

The ASPI re­port rec­om­mended RCEP na­tions seek a “high-qual­ity agree­ment and not be tempted to adopt the low­est com­mon de­nom­i­na­tor ap­proach”.

The lat­est RCEP talks con­cluded in Ja­pan last week with­out signs of sig­nif­i­cant progress, with the next round ex­pected in the Philip­pines in May.

Should pro­tec­tion­ism and iso­la­tion­ism pre­vail, the Asi­aPa­cific re­gion could be­come less open and in­te­grated.” ASIA SO­CI­ETY POL­ICY IN­STI­TUTE

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